Introduction The Queensland Government actively encourages and welcomes foreign investment in its resources sector. Queensland offers world standard production of mineral and energy resources, and large areas of underexplored land to encourage investment opportunities in existing and new commodities. Queensland has modern rail, port and pipeline infrastructure to support mining and petroleum industries and exports into international markets, with programs in place to expand infrastructure capacity to meet increasing demand. We have a highly skilled and productive workforce, with programs to provide skilled workers to meet the State’s growing resources industry. A subtropical climate, pro-business government, strong and resilient economy, highly skilled workforce and location in the Asia- Pacific region makes Queensland one of the leading destinations in the world to invest in mining and petroleum projects. Industry overview Queensland is rich in natural resources of coal deposits, metallic and non-metallic minerals and petroleum, notably coal seam gas. Queensland is in the world’s top five regions for the production of lead, zinc, bauxite and silver and is one of the largest seaborne exporters of coal in the world (Figure 1). Queensland’s mining and energy resources contribution to the State’s economy generates $20.56 billion or 7.3% of gross state product. It represents 59% of all State exports, worth over $27.6 billion, with direct and indirect employment of over 180 000 people. The sector attracted 53% of all capital investment in Queensland and exploration expenditure of over $1 billion (2014–15 figures). Queensland remains one of the leading destinations to undertake resource activities. The Government has undertaken to open up land for exploration, and make geoscientific discoveries and new data more accessible. It is also opening the door for new investment opportunities in established and also emerging resources such as lithium, graphite, cobalt, vanadium, scandium, rhenium and unconventional petroleum. Coal industry overview Queensland has a rich endowment of high-quality coal resources, with more than 34 billion tonnes (Bt) (raw in-situ) having been identified. Coking coal accounts for approximately 8.7 Bt, of which about 4 Bt are considered suitable for open-cut mining. The Bowen Basin, which contains almost all of the State’s hard coking coal reserves, is the most important source of export coal in Queensland (Figure 2). Queensland currently accounts for almost one eighth of global metallurgical coal production and about 50% of international trade in this commodity. Exports of high-volatile thermal coals are increasing from the Clarence-Moreton and Surat basins which, along with the Callide and Tarong basins, are also important sources of thermal coal for domestic power generation (Figure 2). At approximately 60 million tonnes (Mt), Queensland also accounts for almost 15% of internationally traded thermal coal. In 2014–15, 1 Queensland mines extracted about 310 Mt of raw coal and produced a total of 243.6 Mt of saleable coal. During this period 217.8 Mt of coal worth $23.5 billion free-on-board, was exported to over 30 destinations overseas (Figure 3). Markets in Asia account for over 80% of these sales. These coal exports comprised 160.2 Mt of metallurgical coal (coking coal used in iron and steel making and coal used for pulverised coal injection into blast furnaces) and 57.6 Mt of thermal coal used for electricity generation and in industrial processes. Figure 4 highlights the steady increase in exported coking coal since 1997. In 2014–15, an additional 22.5 Mt (includes coal from the domestic stockpile) were supplied to domestic markets in Australia (22.3 Mt to markets within Queensland). Coal production in 2014–15 was contributed to by 41 open-cut and 13 underground mines, with mine closures in the past few years offset to a degree by a number of new mining operations commencing operations in the Bowen Basin. BHP Billiton Mitsubishi Alliance (BMA) brought the Daunia open-cut mine into operation in March 2013 and coal production from its Caval Ridge open-cut mine commenced in March 2014. Both of these projects formed part of the company’s Bowen Basin Coal Growth Project, which includes the expansion of the mining operations at Goonyella-Riverside. Both operations have now reached full production of mainly coking coal for export. For more information on the Queensland coal industry go to DNRM or Business industry websites. A large portion of the Queensland resources industry is now foreign owned, particularly in coal where by multinational corporations based in Japan, the United Kingdom, Switzerland, USA, Brazil and South Korea; and recently China and India are either establishing new developments, or acquiring substantial equity in projects throughout Queensland. 1 Coal figures released 17 May 2016. July 2016 Queensland’s mining and petroleum industry overview For further information contact: Geological Survey of Queensland Department of Natural Resources and Mines PO Box 15216, City East, Queensland 4002 Email: [email protected]www.dnrm.qld.gov.au continued page 5 Department of Natural Resources and Mines CC16-GSQ001
Transcript
IntroductionThe Queensland Government actively encourages and welcomes foreign investment in its resources sector. Queensland offers world standard production of mineral and energy resources, and large areas of underexplored land to encourage investment opportunities in existing and new commodities.
Queensland has modern rail, port and pipeline infrastructure to support mining and petroleum industries and exports into international markets, with programs in place to expand infrastructure capacity to meet increasing demand.
We have a highly skilled and productive workforce, with programs to provide skilled workers to meet the State’s growing resources industry.
A subtropical climate, pro-business government, strong and resilient economy, highly skilled workforce and location in the Asia-Pacific region makes Queensland one of the leading destinations in the world to invest in mining and petroleum projects.
Industry overviewQueensland is rich in natural resources of coal deposits, metallic and non-metallic minerals and petroleum, notably coal seam gas. Queensland is in the world’s top five regions for the production of lead, zinc, bauxite and silver and is one of the largest seaborne exporters of coal in the world (Figure 1).
Queensland’s mining and energy resources contribution to the State’s economy generates $20.56 billion or 7.3% of gross state product. It represents 59% of all State exports, worth over $27.6 billion, with direct and indirect employment of over 180 000 people. The sector attracted 53% of all capital investment in Queensland and exploration expenditure of over $1 billion (2014–15 figures).
Queensland remains one of the leading destinations to undertake resource activities. The Government has undertaken to open up land for exploration, and make geoscientific discoveries and new data more accessible. It is also opening the door for new investment opportunities in established and also emerging resources such as lithium, graphite, cobalt, vanadium, scandium, rhenium and unconventional petroleum.
Coal industry overviewQueensland has a rich endowment of high-quality coal resources, with more than 34 billion tonnes (Bt) (raw in-situ) having been identified. Coking coal accounts for approximately 8.7 Bt, of which about 4 Bt are considered suitable for open-cut mining. The Bowen Basin, which contains almost all of the State’s hard coking coal reserves, is the most important source of export coal in Queensland (Figure 2). Queensland currently accounts for almost one eighth of global metallurgical coal production and about 50% of international trade in this commodity. Exports of high-volatile thermal coals are
increasing from the Clarence-Moreton and Surat basins which, along with the Callide and Tarong basins, are also important sources of thermal coal for domestic power generation (Figure 2). At approximately 60 million tonnes (Mt), Queensland also accounts for almost 15% of internationally traded thermal coal.
In 2014–15,1 Queensland mines extracted about 310 Mt of raw coal and produced a total of 243.6 Mt of saleable coal. During this period 217.8 Mt of coal worth $23.5 billion free-on-board, was exported to over 30 destinations overseas (Figure 3). Markets in Asia account for over 80% of these sales.
These coal exports comprised 160.2 Mt of metallurgical coal (coking coal used in iron and steel making and coal used for pulverised coal injection into blast furnaces) and 57.6 Mt of thermal coal used for electricity generation and in industrial processes. Figure 4 highlights the steady increase in exported coking coal since 1997. In 2014–15, an additional 22.5 Mt (includes coal from the domestic stockpile) were supplied to domestic markets in Australia (22.3 Mt to markets within Queensland).
Coal production in 2014–15 was contributed to by 41 open-cut and 13 underground mines, with mine closures in the past few years offset to a degree by a number of new mining operations commencing operations in the Bowen Basin. BHP Billiton Mitsubishi Alliance (BMA) brought the Daunia open-cut mine into operation in March 2013 and coal production from its Caval Ridge open-cut mine commenced in March 2014. Both of these projects formed part of the company’s Bowen Basin Coal Growth Project, which includes the expansion of the mining operations at Goonyella-Riverside. Both operations have now reached full production of mainly coking coal for export.
For more information on the Queensland coal industry go to DNRM or Business industry websites.
A large portion of the Queensland resources industry is now foreign owned, particularly in coal where by multinational corporations based in Japan, the United Kingdom, Switzerland, USA, Brazil and South Korea; and recently China and India are either establishing new developments, or acquiring substantial equity in projects throughout Queensland.
1 Coal figures released 17 May 2016.
July 2016
Queensland’s mining and petroleum industry overview
For further information contact: Geological Survey of QueenslandDepartment of Natural Resources and Mines PO Box 15216, City East, Queensland 4002Email: [email protected]
www.dnrm.qld.gov.au
continued page 5
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2 Queensland mining and petroleum industry overview (July 2016)www.dnrm.qld.gov.au
Figure 1: Queensland’s mineral, coal and petroleum operations and resources
Figure 4: Queensland coal exports 2014–15 by type (217.8 Mt total)
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New developmentsNew developments in the Bowen Basin include Grosvenor underground mine (Anglo American and Exxaro); and scope for future development such as the Wandoan open-cut mine in the Surat Basin.
Exploration and development of thermal coal deposits to supply large tonnages to the export market now includes a focus on shallow coal occurring along the eastern and northern flank of the Galilee Basin in central Queensland (Figure 2). A number of large-scale coal mines, each with saleable production of between 30–60 Mtpa, are currently being planned in this region. These include:
• Alpha and Kevin’s Corner Coal Projects (Hancock Coal, in joint
Minerals industry overviewIn 2014–15 the industry accounted for 53% of Queensland’s private new capital investment and 59% of State exports. After coal, base metals are the most important sector of the State’s mining industry. In 2014–15 the value of mineral mining in Queensland was over $8.6 billion producing a wide range of metallic and non-metallic mineral products that include bauxite, copper, gold, zinc, lead, silver, magnetite, titanium, tin, tungsten, nickel, apatite, ceramic and structural clays, bentonite, kaolin, diatomite, dimension stone, gemstones, gypsum, limestone, dolomite, magnesite, peat, perlite, phosphate rock, salt, silica, and zircon.
Queensland is Australia’s top producer of silver, lead, zinc, and copper. In 2014–15, the State produced:
Queensland is Australia’s second largest bauxite producer (34%) and third largest gold producer (6.0%). Queensland was also the world’s second largest lead producer, third largest zinc producer, and fifth for both silver and bauxite production (Figure 5).
The mineral provinces in north and north west Queensland contain most of Queensland’s metalliferous mines. The north west region alone produces over 70% of the value of metalliferous minerals
recovered in Queensland. These regions are world-class in terms of their base metals and industrial minerals production, possible new mineral projects across a range of commodities and potential for more discoveries.
In recent years, exploration near existing mines has largely sustained Queensland’s mineral industry by discovering new deposits, extensions to known deposits or re-opening mines. These include Lady Annie, the Merlin molybdenum project and Osborne copper mines, and the Wolfram Camp and Mount Carbine tungsten mines. Other significant new operations include the Lady Loretta zinc mine and Evolution Mining Limited’s Mount Carlton gold-silver-copper deposit. Minerals and Metals Group Limited (MMG) recently received prescribed project status from the Queensland Government’s Coordinator-General with regard to its Dugald River zinc-lead-silver deposit development north of Cloncurry.
North west Queensland also hosts the Phosphate Hill mine, a large open-cut phosphate mine that is the State’s most significant industrial mineral operation in terms of production value.
The Weipa bauxite mine (Rio Tinto Alcan) on Cape York in north Queensland is one of the four largest bauxite mines in the world. Late in 2015 the company decided to construct the nearby Amrun bauxite mine (previously known as South of Embley) centred 40 kilometres (km) south of Weipa and 40 km north of Aurukun at an estimated capital cost of US$1.9 billion, thus securing bauxite supply for the foreseeable future.
The establishment of mineral processing plants, including world-class copper and aluminium smelters and copper, alumina, zinc and nickel refineries, and extensive transport infrastructure allow value-adding to local production of ores and concentrates for the export market.
The Diamantina Power Station in Mount Isa was opened in December 2014 and provides a reliable electricity supply solution to the north west and is able to be expanded to meet growing energy requirements in the region. The 622 km North-East Gas Interconnector gas pipeline between Tennant Creek and Mount Isa should be completed by 2018. Another positive for the north west region was the extension of the environmental authority for the Mount Isa copper smelter to operate beyond 2016 to 2022.
For more information on the Queensland minerals industry go to DNRM or Business industry websites.
Silver1240 tonnes71% Australian5.6% Global
5th in the world
Zinc1 071 000 tonnes63% Australian7.4% Global
3rd in the world
Lead461 000 tonnes66% Australian8.9% Global
2nd in the world
Bauxite27 434 000 tonnes34% Australian11.2% Global
3rd in the world
Copper287 000 tonnes30% Australian1.5% Global
13th in the world
Queensland
Rest of Australia
Source: OCE and USGS
• 71% of Australia’s silver
• 66% of Australia’s lead
• 63% of Australia’s zinc
• 30% of Australia’s copper
Figure 5: Queensland’s ranking within Australian and global mineral production in 2014–15
6 Queensland mining and petroleum industry overview (July 2016)www.dnrm.qld.gov.au
New developmentsNew discoveries of base metal resources are required if Queensland is to maintain its dominance in these industries in the long term. In addition, Queensland’s importance as a gold and mineral sands producer will continue to decline, unless good quality discoveries are made.
In the medium term in north and north west Queensland, the State can broaden its resource production from already known deposits with molybdenum and rhenium, and potentially scandium and various rare earth elements, in part subject to market conditions. In southern Queensland the South Burnett region has similarly has potential for long term production of bauxite ilmenite feldspar apatite zircon and magnetite from known near surface deposits.
In north west Queensland, CuDECO Ltd is in the final stages of developing the Rocklands’ copper-cobalt project, and as mentioned above MMG Ltd is developing Dugald River, one of the largest and highest-grade deposits of zinc, lead and silver in the world with an estimated 28 year mine life from an underground mine with a production rate of 1.5 Mtpa. Altona Mining Ltd’s large low grade copper project at Roseby is adjacent to Dugald River and also close to development. Currently due diligence is being carried out by the potential joint venture partner the Sichuan Railway Investment Group (SRIG). After successful trail mining in mid-2015, the Australian New Agribusiness and Chemical Group Ltd has executed a sales contract for mining the Korella phosphate deposit near the Phosphate Hill mine.
Noteable discoveries in the region with potential for new mines are Red Metal Ltd’s Maronan silver-lead project south of Cloncurry and Minotaur Exploration Ltd’s Artemis polymetallic deposit south east of Cloncurry while it is reassuring to note new zinc-rich extensions to the Pegmont deposit by Vendetta Mining Corporation. Hammer Metals Ltd’s ongoing exploration at and near the Kalman and Overlander deposits south east of Mount Isa and Aeon Metal Ltd’s exploration at Walford Creek near the closed Century mine should also be noted.
On Cape York Gulf Alumina Ltd submitted an environmental impact statement on the Skardon River bauxite project in October 2015 and plans to commence production as soon as possible. The project life is expected to be 10 years with a construction period of approximately 1 year. Metallica Minerals Ltd has a mineral sands deposit and a bauxite deposit at Urquhart Point with potential for production in 2017.
In north Queensland a definitive feasibility study by Resolute Mining Ltd is due for the Ravenswood extension project which potentially will result in ongoing mining operations at Ravenswood beyond the scheduled closure of the Mount Wright mine about March 2017. Red River Resources Ltd acquired the Thalanga project at the end of October 2014, has had encouraging exploration results and has estimated that it could restart production within six months of a decision to mine. Consolidated Tin Mines has just completed a positive definitive feasibility study on the Gillian deposit and is expanding the study to include the Pinnacles deposit with completion expected in the first half of 2016. Strategic Minerals Corporation continues to extend the Big Vein deposit at Woolgar north of Richmond.
In southern Queensland gold, copper sulphate and a pyrite concentrate should be produced from the tailings at Mount Morgan by Carbine Resources Limited pending completion of a feasibility study. Mantle Mining Corporation intends to re-commence gold mining at Norton near Calliope during the first half of 2016. In September 2015 Australian Bauxite Ltd announced the discovery of good quality bauxite, exposed at the surface, at Brovinia near Gayndah.
Throughout north west and north Queensland numerous deposits containing rare earth elements and thorium are actively being explored, usually in association with copper and gold. Exploration is also occurring at the Julia Creek oil shale–vanadium– molybdenum deposit. Queensland currently has around 90% of Australia’s known oil shale resources, which are equivalent to approximately 22 billion barrels of oil.
Petroleum industry overviewThe petroleum industry in Queensland exceeds $1 billion in production value. Petroleum (including coal seam gas (CSG)) exploration expenditure in Queensland continued at a high level for 2014–15, reaching $751.6 million compared with $612.6 million in 2013–14.The level of exploration expenditure is a reflection of the continued commitment by companies to prove-up and develop their CSG reserves to service the export LNG industry. This growth in CSG has been rapid over the past 15 years—the annual number of wells drilled increased from 10 in the early 1990s to over 1634 in 2013–14 and 914 in 2014–15 (Figure 6).
Coal seam gas production in the Bowen (Permian coal measures ) and Surat (Jurassic Walloon Coal Measures) basins represents 92% of the total gas produced in the state (Figure 7).
Figure 6: Annual Queensland conventional petroleum and CSG wells drilled, to 30 June 2015
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New discoveriesMany of Queensland’s basins with petroleum or coal have potential shale gas, tight gas or CSG resources, including the Isa Superbasin and the South Nicholson, Georgina, Adavale, Cooper, Bowen and Eromanga basins Exploration in the Cooper Basin has targeted the Permian Gidgealpa Group for basin centred gas in the Nappamerri and Windorah troughs with promising results. Several wells have also been drilled to target deep, tight gas resources in the Taroom Trough of the Bowen Basin and to evaluate the unconventional petroleum prospectivity of the Georgina Basin. This exploration activity represents the further expansion of Queensland’s petroleum industry.
For more information on new developments in Queensland go to DNRM or Business industry websites.
Figure 7: Queensland conventional gas and CSG annual production by basin to 30 June 2015
As at 30 June 2015, proved and probable (2P) reserves reached 42 733 petajoules (PJ) (Figure 8). Production from these sources is expected to supply an increasing proportion of the Queensland and other eastern Australian markets. Conventional gas production in 2014–15 was 40 PJ compared with 457 PJ from coal seam gas production (Figure 9).
For more information on Queensland coal seam gas and petroleum industries go to DNRM or Business industry websites.
Like the coal industry, Queensland’s petroleum industry has a large portion of foreign ownership. This is based on the establishment of an LNG industry with investment from companies in China, Japan, Korea, Malaysia, Netherlands, the United Kingdom and United States of America.
New developmentsIn the last decade the abundant coal seam gas reserves have provided the foundation for the development of an LNG sector based in Gladstone, in central Queensland. These include:
•QCLNG – British Gas (BG) Group and China National Offshore
Oil Corporation (CNOOC)
• GLNG – Santos, Petronas, Total and Korea Gas Corporation
(KOGAS)
• APLNG – Origin, ConocoPhillips and Sinopec.
All three operations are now exporting LNG as of January 2016.
Future LNG developments considered include Arrow LNG and Fisherman’s Landing projects.
8 Queensland mining and petroleum industry overview (July 2016)www.dnrm.qld.gov.au
