11Y-
~ iMZTRALIA
PR31i1,4F 1PJBNISTER 6 Novemrber T978
XI0O7N COUtmCiL FINA-NCIG OF DMTELOPI?{ ENT PROJECTS
The Commonwealth and. State Governments, Maeting as
2oa-Colancil, today approved an entire-ly new borrowingprogra-
m which will have a signific,-qt imipact oa Aiustralials
developmrent. Th e Lo an Council, acting in. accordance with guidelines
set at its meeting last June, approv,$; d the first projiects to
fo Par-t-of this new program.,
The projects approved cover al11 six States amd.
-p~ idez-for a total borrowing programn of $ 1767 million over
eight years, co-uencng with borrowYings of $ 1.5B mill-ion. th-. is
f inancial year. This approval is the culrination more ithan_ t(, zo
years of intensive study and discussion. ork com-, r-nced in
Ztunp 197.6-on the exarrdnation of particular! financing needcs in
the provision of infrastructure, especially for developme~ nt
projects. This work arose out of a concern that future inajoideyelcp~
et~ a projects, with financing requiremeants which coujld
not be accommoated within nor~ mal " serai-governmenttt borrowing
programns, might be* imnpeded unless a system of providin' I
additiona-to normaal borrowing could bret developed. special
At its meeting in June 19718, the Loan Council adoptedl
arn-eventz for infrastructure finiancing which set out guidelines
for consideration by it of proposals for special a-dditions to
the normial annual " semi-governm~ ent" borrowing program~ s and
froyez~ eas borrowing authorities.
Under the guidelines, these special additions would
bfoer Proqaals whicli could not be Teasonebly accommodated within.
resourc-es normally available to the Governmrent and the authority;
wh-ich provide services of kinds normally providcd by Governrl-nt
or 3public-utility enterprises; and which have special
significante for development. Factors which would properly
be talken into account in considering proposals would include
whetier the Proiect: .4/ 2:
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contributead to the development of Australia's
national resources;
contributed to the balance of payments;
helpead strengthen the structure of industry;
contributed to ezrp1oymtent.
These additional borrowi-ngs were thus desiq-ned to
poide essential facilities which would encourage productive
enterprises to counence or expand. In many instances, the.
orovision of new infrastructux-e would speed up the daelopnmant
of new e>: port oriented natturz: l rosour-ce projects in
decentra2iscd areas.
Trhe Loan Council decided in June it would consiaer as~
practicable later this year -the first batch of projec-Ira " A
submitted by t-he States within these guidelines. ' The
Commowealth BFudget was fraired in the knowledge that applications
___ for such additional borrowings coz,-Dncing in 1978/ 79 would he
considered by Loan Col-Lcil.
___ The State Governmnrts proposed a total of 12 prje. s
-for special boa-owing under the program andsnetn hs
projects have been the subject of intensive examination and
___ report by Conmonwealth and State officials.___
In assessing its attitude to the projects, the
_______ Comonwealth has been particularly conscious of its overall
economic mariagen-ent responisibilitie h edt nueZn
that the level of special borrowings approved, both in total
alinual reouircnrents, is consiste-nt -with the Commonwealth's
fiscal and monetary policy objectives. There could be. no
question of allowing the level of special borrowings -to
omnpromise our steady progre. ss toward-s economic recovery.
Subject to this overriding econormic pol-icy constrain*
t-he individual projects were assessed in relation to theW
program guidlelines. major group of projects approved will encourae
further substantial private de-valopnment of our natural resources.
developreant of Australia's coal exotindustry
require the provision of efficient port facilit-ies for loa~ 3iii
the coal. There are two coal-loader projects one from
New SouthL Wales, the other from, Queensland.___ / 3
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Port Yetrnhla Palrn-iin Coal Loader Project ( N. S.
in 2978/;
concernec
on coj r-agc ( special horrowing addition of" $ 89 million approved)
This involves a ne; w coal loader anud stockpiling
facilities at Port Kerbla, more than doubling ainnual
capacity; and au,: gmentaticn olf the Bab-in loader to
incr-:! asio its capar-ity signifi-cantly. T h if tX a
loader capacity is rcgu" ired to acc-omnodat -e the expansion
of mines in the Ilest, Sout-h west and Southern coalfieldls.
The projec-* L will onhance cconomic: growth and7rfu--;
Mec tropolitan entr" loynat in S-1.
Coal ' En ort Facilities a t Hay P'oint ( Qid.)
( special borrowiing additioa of $ 75 million. approved)
involving the pxovi.-ioa, at Hay 11oint, south -o
MackaY, of oni-shoxe facilities such as rail unloading.,
and stoc'Kpile area Lnd off-shore facilities in~ cluding.
trestle a-rd conveyor, a ber-th and dredging the___
special addItion is for the off-shore facilities.
The project will enable the cdevelopirent of major
ex. port coal projects ( German. Crae%' and Qaky Creek)____-
aroundc which new townYships will be developed. The
coal develop-, rnt will add to Queensland State
revenues through payroll taN, royalties and rail
f reight.
T'wo othier projects closelyv related to major private___
( level op,-, en t will not involve irunneiate expenditure
However, approval now will indicate to thie companies
Ithat the nt-cessary infrastructure is assured a-rd
-then, t'-o ma1ke favourable decisio-, s for develoczpent.
~ Rzedcl1iff Proiect
( special borrowing addition of 6 rilion aproved)
plans to use liquid hydrocarbons fton, the Cooper
Basin as fccdstock fEor a petrocmical plant at
PRedcliff. The special addition of $ 186 million is
to provide a power station, pipelines for liquidis
and gas and other infrastructure to service thepetroche
mcal complex. The FRedcliff project will allow
the ilwosizdiate ex ploitationt of natural gas liquid
reserves which would otherwise be flared and will
accelei-ate the de-velopmren6: of crude oil ai-id condensate
resourccs. it will provide significant regional
-benefits to South Auistralia.
Damier-Perth Gas Pipeline MW. A.)
-( special borrowing addition Of $ 4a6 ndllion approved)
involving the cons truction of a pipeline to bring
natural gas 1,500 } ilo;-, etres fromn Dapier to Perth,
for use in Perth and the South West of the State. / 4
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The project is an integral part of the $ 3,000 Milliont
Nort-h-West Shelf project aund will enable aholut halt
ilie natviral gas resources to be consiiwa-d in Australia.
Natiral gas siapplicci to the Perth/ South W-estI region
wA-vll assist the futuxe broadening of the industrial
base of Western Av-stralia.
One other project piovides infrastructure for a
private development,.
Worsley Allwmina Project
( special box-rcA. ing addit ion of $ 41 nmillion aoproved)
involves the establishment of a bau; ci-alumina
project in the South West of Wstern Australia thle
special adclitions are to provide railway and water
supply facilities for the project. The infrastructure
wid2l contribute to the davclopmrert of a national
resoiirces project which will provide employent in the
StatL-e a-nd be a stimulus to decent-r& lisation,
The second major gjroup of p3roject. s approved will help
increased invest-rient, in the provision of e.' cectricity,
n9-rapa city. These projects are of a Iind normally
by public utilities anid ref-lect the fact that additions
x-Acity rjencrating capacity nceed to be, mada in large
Th-lepurvision of a" Oequate gane;: ating capacity is
y for the continued deve'Lopncent of-L A utr a Iian induistxy.
* ojects are:
L~ oy Yanci Power Station ( Vic-)
( special borrowing addition of $ 34 ilionaprved)
proiect co7?, rising an open cut broyrn coal mine,
two power stations and associated wkslocated
near Traralgon in the Latrobe Valley. The project
Is the niain clement. in the long-term expansiona
programn for rieeting Victoria's electricity needs,
and will contribute to the dave2. opiment of Victoria's
broa. m coal reserves. * Industiry development will be
assisted and there will be a stirtalus to eii~ loyment. H
11 1. I.' I. 1~
-V. S.
I. 1 z~
Fiyaro Electric Power I
*( soe cial borrowing adlJ
I involv'inq assistance i ) Evelopment ( Tas)
lition oL.-$ 75 million approved)
~ n the funding of peak caoital
expen~ diture in the further development of Tasmania's
____ hydro-elec tric power-sistr. m " Phu large scale
production of relativ~ ely low cost power, using
Tasmania's abundant water resources, is a major
factor in the daveloprent-ofnlie. Tasnanian economny
and an incentive for industrial investment.
Er"-ririqr ELectricity Praazt ( 11, S1-14.
( special borrowing additio n of $ 2.00 million approved)
involvinrg a major new power station at Eaigo
LaEe-Macqkt-arie with ass ocf-z min-c-_ s and transmission
lines together with r.-ajor expansion at tWO other
stations. The project is needed for the provision
-G adeqñ-_ atte elcctrical eT-r-zqy jTV-N-S in the f irst
half of the. 1980s. Proposed development in the
coal and forest product industries Ynight rnot proceea
Ir it-s-absence. SignifMaTn erftl-7-0meft will be
created in both the construction and operating phases-
Pow,,-r Station Projecc-t-t(, ld)-
( speCial borroing addition of $ 130 million approved)
_____ including completionL of the. Gladstone power station,
cn6 Petion of the 14ivenhoe pump storage' hydro-electrie
project and work on first stage of the new Tarong
____ power station. The progjects will require the
deV& Iopment of furtber coal mines and will mTake
produ. ctive use of available water resources. The
provision of adequate po-wer suliJes will aid
QueeTvnd inidustrial developazent.
Pilbara TPegion -Power Supply lntccyratio n ( YW. A.)
( snecial borrowing addition of $ 111 miAllion approved)
the power gcenerating capaclty in the Pilbara re-gionl
___ haa_-dr-veloped in a frn ed-t~ rner by individual
companies and the State Energy Corvission is seeking
to integrate the system. The integration will
____ rntri-4ute to a ratin e.. on--a-id more judicious
use of resoxrces and should help decentralisation,
stinrtolte industrial dema~ nd and lead -to increased
emplo_. m
There are two other projects that do not fall into the above
c-ategories. / 6
Worl rp. d. CceatLre ( Vie)
( spe-cial borrowing aadit'LOn of $ 56 million a-poroved)
The proposal covers the first st,-age off the World
Tradu= ixte~ ple to be construc '~ hhafof
the fielbourne Harbour Trust on thc edcc oJE the ccntral
business district of Idelbourne. Melbourne is
Au St rTa--s lc-mftinq export prWt~ idoe
tradc centre v,. ill be a focal point for the developm~ ent
of overseas inarkets, mankirig a positive coitribution to
-A stxratia's balance of -P-aj bT~ gin ts
approva. L to this project, teLoar Council agreed
unan im ou sl1y that approval was on the basis that no
-~ ter--tztcwould in the fture1-. ing foniard a
similar proposal unider the infrastructure guidelines.
Projects ( 75-s
( special borrowing aadition of $ 35 million approved_)
involving the-augmclntatiflDL supply to the Hobart
metropolitan area and to the North Esk ' x" eg; ion ana
the construction of a regional supply system for the
I~ oorft West ~ ci-o ñ_. projects miaiz
use of Tasmania's abundan~ t water resoorccs and will
Contribute to iindustrial dvlpetin the15 Stat-e.
. Ps a result of thi's approa _ h_ Tasmania Pxemi er
agreedA*_ that his State would not be seeking any funds
uder t1-he curre. nt li-ion-Wter Resources Prograiri
_ ThTeaa d 6+ t ioia borrowings approval by thie Loan Cotncil
will be p: hased over the eight years bcqgrDnng in 1978-79. The
Phasing of the projects is such that there is a relatively
steady bof-c-h4InTg requirement year by ycear. 4In 197B-79, the
additional borrowings will be a maximur. ofA $ 158 millioP.-Over
the following five years, the annual additional borro' 1ings1 Will?
1979-80 $ 395 miilIZhn-, l980-81 $ 316 million, 1991-82 $ 3113 raillion,
1982-83 $ 236 million, 1983-84 $ 283 million-The Comowalh
Gover-nment. considers this prTogram to be anpxopriate and__
con si stent wtth ornetsfiscal and monetary policies W
and th-us will assist in the nation's economiAc recovery.
AttIEaEcY-TenE Ishows the total s approved for special
borrowing, project by project, and the phasing-Attachm-ent 2
nrovides more detailed infomration on the individual projects.
Loan Council decided that applications for overseas
borrowing inr connection with the approvea projects will require
sparate Loaff-C-ouiciT-c6n side ration in thc-light of particular
requirements of the project concerned anid economic and financial
Circumnstances at the timeo. TI current circ1umstances,
applications--Ir bv6f--es borrowings in respect of-the 1978-79
approvals could be expectetd to receive favourable consideration
-by Loan Council.___ / 7
I would ernph-asizc. the carc which has gone into-the
plann~ ing pL.ñ his inaportant new int~ ti'eand-the cde( reo
co-operationl attainec3 betvieen the Cortuonwealth and the States.
comonwealth and State Treasury of ficers have been working.
together n the zat-tcr since J-ine 1976--
Th-a Prog; ram will be a co-ntiroing orie to which new
and wortuiwhilpe pro-jects will. be adc! the.-initial projects
progress and rceachi coiwplction. Additions to the Program will
of Course be svbject to loan Council scrutiny against the
program ~ j~~ fQ~ dthe econo-Pic cill u.. ms.. ta-nces of the ti me..-
In view ofL the size of the initial nroject borrowings approved
today and the ccnccntraticn. of these borroiwings in thea earlier
years, the _ f_= onwe. a1. th indica-ted tha-t--It--wcul&--not f av. our anyv
addaitions to the Program for the next three years.
LI,! Dnou-ii acknvc41-edge d ta h~ ddto
borrowings approved -vner this -po~ a will need to be bon
i n idnd in considering the nornal " sem-rcovernment" borrowi-ng
program i-n June-
It was uxnaninously agreed thnat as far as possible,
all capital equip-ent uire fo epoj~ et shola1d-be
purchased from Australian manufacturers.
This imnrortant initia-tive qenrtiAlly a vehicle
xor the long temi develop _-nt of our natio: n and its rsucs
It is dovsigne4I -to strengthcn and dee; pen oour capital structure
anda hernce -increase ou;-: productive capacity-,
The projects will, in the shoxrter term, provide a
useful addition-0 ,, noyen~ t opp) iort-unities and will have longer
term effects arising from private sector dev%, elopment which is
encouraged and assisted by the infraztructure provideda.
ThiTspFogramnis the start of anew era in Coimonwealth/
State co-operation in d~ evelopment. lore importantly, it
provides tangible evidence of the confidence which all Governirets
in Australia have in otur future development r-it is our vote of
confidence in the future of Auistr: alia.
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I ASTRUCTUR41 F2MANCING MnTEI~ t. M An PIIM
STATE PIROjECT A MIM M TOPGX4
SPECIAL 1978179 1979/ 80 1980/ 81 1981/ 82 19293 g3/ 84 943 1985/ W6
ADD271ON.
Coal Loaders 33243
Eraring Electricity 55251705 a
rwI Loy Yang Mectricit7. -3br$ 35 83 37 119
~ Iorld Trade Centre 5 10 2420 2
ZIDKy Ft Ccal Loaders 7' 5: 40 35
Efec: tricity -Projects 130 70 -0
SR. Iedclifft 186. 1 70 9644
NADanpier-Perth Pieline : 416.: 163 263 17 3
P'Ibara Electricity 1111 5 11 15 13 16 27 21
Vor3ley F~ ail and Water ~ 4 9* 20 12 1-
rUS H3Plro-electric Power' 75' 15 15 15 15 15
ridt supply projects 35-I6 8 a 5 4
Any ZaiIlire to add cr03SsuiWdue to rournding. 77-77'
ERARING ELECTRICITY PROJECT ( NSW)
Brief Description A major new station at Eraring on Lake Macquarie of
4 x 660 MW units, and associated mines and transmission lines,
together with major expansions at two other stations ( Vales
Point and Wallerawang) create a peak expenditure situation
over the three years commencing 1978-79. Work for the first
two units at Eraring has been in progress since 1977 and
contracts have been let for some components of the other two
units. Funding Arrangements A total of $ 682 million at June 1978 prices, will be
required over the three years. $ 456 million of this is required
for Eraring. The availability of funds from internal generation,
depletion of reserves and normal loan allocations is anticipated
to be $ 472 million, at June 1978 prices, leaving a shortfall
of $ 210 million. Special additions are sought for this.
Phasing Expenditure at June 1978 prices, in the three years
commencing 1978-79 of $ 211, $ 238 and $ 233 million ( total
program) and $ 87, $ 174 and $ 195 million ( Eraring). Very
little flexibility exists in these timings. The special
additions to borrowings will be required as follows
1978-79 1979-80 1980-81
Sm 55 80
General Comments Project is needed for the provision of adequate
electrical energy in New South Wales in the first half of the
S 1980' s. Proposed developments in the coal industry and forest
product industry might not proceed in the absence of clear
indication of energy availability.
Improvement of employment opportunities in a country
region a peak of 1,100 workers will be employed during
construction and some 1,700 will be required for operating the
power stations and coal mines.
COAL LOADING FACILITIES ( NSW)
Brief Description New coal loader and stockpiles for Port Kembla
to more than double annual capacity to 15 million tonnes
and to increase from 70,000 to 110,000 tonnes the size of
ships that can be handled. Augmentation of Balmain loader
and stockpiles to increase capacity from 2.8 to 4.5 million
tonnes per annum and ship size from 40,000 to 55,000 tonnes.
Tenders called for some parts of the works, others in
advanced stages of planning.
Funding Arrangements Expected cost at June 1978 prices of $ 89 million.
other commitments of industry and Maritime Services Board
necessitate financing in full by special additions.
Phasing Special additions required in the three years
commencing 1978/ 79 of $ 24, $ 32 and $ 33 million at June
1978 prices. Delayed completion would be at the expense
of economic development, employment and sales of export
coal. General Comments Exports of coal from the West, South West and
Southern Coal fields already exceed loader capacity.
Mines cannot expand unless loaders are provided and the
increased ship sizes able to be handled will aid market
diversification. Will benefit balance of payments through
increased export earnings.
Benefits for non-metropolitan employment7 will
aid decentralisation7 will contribute to New South Wales
State revenues.
LOY YANG POWER STATION ( VIC)
Brief Description The Loy Yang project is a major base-load power
development comprising an open cut brown coal mine, two power
stations, each with an installed capacity of 2000 MW, and
associated works located near Traralgon in the Latrobe Valley
( approximately 160 kilometres from Melbourne).
Preliminary work on the project commenced on site
early in 1977 and all major contracts for the first 2000 MW
stage have been let.
Funding Arrangements The project, to be constructed by the State Electricity
Commission of Victoria, is estimated to cost $ 2,050 million at
June 1978 prices. Special additions to the Commission's borrowing program
totalling $ 343 million at June 1978 prices, are required to
assist in financing the initial stages of the project.
Phasing The special additions to borrowing would be required
as follows: Sm 1978-79 1979-80 .1980-81 1981-82 1982-83
88 37 119 64
It is essential for construction work to continue
0 as planned in order to ensure that the first generating capacity
will be available for commission in 1983/ 84.
General Comments The Loy Yang project is the main element in the
State Electricity Commission's long-term expansion program
for meeting Victoria's electricity needs.
During construction of the project there will be
some 1,500 people directly employed. On completion the
project will directly employ an additional 1,000 persons in
the Latrobe Valley.
WORLE TRADE CENTRE, MELBOURNE ( VIC)
Brief Description The proposal covers the first stage of the World
Trade Centre complex proposal for construction by the
Melbourne Harbour Trust on the edge of the central business
district of Melbourne. The first stage of the complex comprises
the world trade centre itself, a trade mart and office
accommodation for organisations and firms having a close link
with overseas trade, including the Melbourne Harbor Trust.
Tenders have been called for this stage of the project.
Fundinp Arrangements The project will be constructed by the Melbourne
Harbor Trust and a special addition of $ 55.9 million is sought
to the Trust's borrowing program.
A decision on the availability of funds is required
to enable work to commence during the last quarter of 1978
calendar year.
0 Phasing The special addition to borrowing would. be made as
follows: 1978-79 1979-8 1980-81 1981-82
24 20 2
As tenders have been called work could commence as
soon as funds have been approved.
0 General Comments Melbourne is Australia's leading export port.
The proposed trade centre will be a focal point for the
development of overseas markets and for information on
commodity prices, freight and insurance. By promoting export
opportunities for Australian industry it could make a positive
contribution to Australia's balance of payments.
During the construction period the project will
provide employment for more than 1,000 people. In operation
it is expected to increase the efficiency of port administration.
COAL EXPORT FACILITIES AT HAY POINT ( OLD)
Brief Description Provision of new coal loading facilities at Hay Point,
south of Mackay, to be operational by 1981 to meet planned coal
export growth. On-shore facilities include rail unloading and
stockpile area while off-shore facilities include trestle and
conveyor, a berth and dredging.
Proposed capacity is 12 million tonnes per annum with
provision for future expansion to 24 million tonnes per annum.
Funding Arrangements Estimated cost of facilities is $ 115 million at
current prices.
0 Proposed that private sector ( coal developers) will
provide finance for the on-shore facilities by way of security
deposit on shared basis, approximate cost $ 40 million.
In addition private sector will meet the cost of other mining
infrastructure ( township facilities, major railway improvements,
power and water supply). This cannot be fully quantified at
this stage but the cost of railway improvements alone for the
first two mines ( which will use only half the proposed capacity)
will be approximately $ 100 million.
Proposed that State meet the cost of off-shore
facilities, estimated cost of $ 75 million at current prices
all by special additions.
Phas inp_
0 1979-80 $ 40 million, 1980-81-$ 35 million.
Detailed planning and construction needs to commence
by end 1978 to enable facilities to be ready for use by 1981
when the first mining project is expected to begin shipments.
General Comments The provision of the facilities will enable the
development of major export coal projects in Queensland ( German,
Creek and Oaky Creek). The projects will contribute significantly
to Australia's balance of payments through increased export
earnings. There would be additions to Queensland State
revenues through payroll tax, royalties and rail freight.
It is expected that townships of around 4,000-5,000
people will developed for each mine.
POWER STATION PROJECTS ( QLD)
Brief Description To cover projected growth in demand, additional
electricity capacity will be required over the next five
years, including completion of Gladstone power station
by 1981 ( additional 550 MW).
Completion of Wivenhoe pump storage
hydro-electric project by end of
1983 ( 500 MW), and
Work on first set of new Tarong power
station to be completed by 1985
( total Tarong 1,400 MW).
Funding Arrangements Total requirement is in excess of $ 1,200 million
( at current costs), $ 130 million of which is required as a
special addition balance to be funded internally including
normal loan allocation.
Phasing 1979-80 $ 70 million, and 1981-82 $ 60 million.
Approval required now to enable planning of development
and level of power tariffs.
* General Comments The projects are needed to maintain power supply
in the State at anticipated levels. The stations at Gladstone
and Tarong will require the development of further coal mines;
while Wiver. hoe will make use of available water resources.
The development of industry in Queensland will be aided by the
provision of adequate pover supplies.
REDOLIFF ( SA)
Brief Description The project plans to use liquid hydrocarbons from
the Cooper Basin in South Australia as feedstock for a
petrochemical plant at Redcliff. The special addition to the
Loan Council borrowing program is to provide a power station,
pipelines for liquids and gas and other infrastructure to
service a petrochemical complex at Redcliff. The current
status is that Dow Chemical ( Aust) Ltd is ready to carry out
detailed feasibility studies as soon as infrastructure is
assured.
Funding Arrangements Total investment in the Redcliff project is estimated
at W95 million ( in 1978 prices).
A private sector component of $ 649 million
is to be financed by Dow and the Cooper
Basin Producers.
A public sector component for infrastructure
of $ 256 million is to be funded by:
South Australian Government $ 253.5 million
Australian National Railways $ 2.8 million.
A special addition of $ 186 million is
required by South Australia as part of
its contribution.
Phasing The special addition to borrowings would be raised
as follows: 1979-80 1980-81 1981-82 1982-83 1983-84
Sm 11 70 96 4 4
Genera] Comments The Redcliff project will allow the immediate exploitation
of natural gas liquid reserves which might otherwise be lost
flared). It will contribute positively to the balance of
payments in export earnings and by substitution for products
that would otherwise be imported caustic soda; vinyl
chloride monomer). The project will provide siinificant regional benefits
to South Australia. The Redeliff complex will provide direct employment for
710 people; and it is estimated that the total increase of 1420
jobs 1 : ill result. The project should create nearly 4500
construction jobs during its peak phase.
DAMPIER-PERTH GAS PIPELINE ( WA)
Brief Description The construction of a pipeline to bring natural
gas from Dampier 1,500 kilometres to Perth, and for marketing
the gas in the South West of the State. The project is a
key component of the North West Shelf gas development which
involves the production of natural gas for the Pilbara, Perth
and South West of Western Australia and liquified natural gas
for export. The Joint Venturers developing the North Rankin
Gas Field are well advanced with their feasibility and design
studies of the overall project and are scheduled to make a decision
with the State in the latter part of 1979 whether or not to
proceed. Funding Arrangements Private sector investment in the North West Shelf
Gas Project is estimated at $ 3,000 million in 1978 prices.
The public sector expenditure in the pipeline is estimated at
$ 442.5 million ( June 1978 prices) of which $ 416 million is
required as a special addition under the infrastructure financing
guidelines. Phasing Latest timing estimates of expenditure of the
$ 416 million special addition ( June 1978 prices) are $ 133 million
in 1982/ 83, $ 263 million in1983/ 84, $ 17 million in 1984/ 85
and $ 3 million in 1985/ 86.
A decision on the availability of funds is required
now to enable the Energy Commission and the Western Australian
Government to firmly declare their ability to proceed and
enable the developers to compile their feasibility and design
studies and make a decision on the whole North-West shelf gas
project by September 1979.
General Comments The pipeline is an integral part of the proposed
North-West Shelf gas development and will enable about half of
the natural gas resources to be used for Australian consumption.
The natural gas supply from Dampier to Perth/ South-West region
will help broaden the industrial base of Western Australia.
The project should assist the balance of payments by allowing
imported fuel oil to be replaced by gas.
The pipeline project will employ directly some 1000
to 1500 people during the construction phase lasting 18 to
24 months.
WORSLEY ALUMINA PROJE~ CT ( WA)
Brief Description The establishment of a bauxite-alumina project in
the South West of Western Australia with an initial alumina
capacity of 1 million tonnes per year is proposed. Bauxite
will be either railed or transported by conveyor to the
refinery and water requirements for the first stage of the
project will be piped from Vi~ e Wellington Dam. The special
additions to borrowing programs are to provide the railway
and water supply facilities.
Funding Arrangements Assuming bauxite is railed to the refinery the
private sector investment in the total development is estimated
at $ 695 million ( June 1978 prices).
Total public sector investment is estimated at
million ( June 1978 prices) and special additions of
$ 41.1 million ( June 1978 prices) are sought for the provision
of water supply and rail facilities which will be funded entirely
by the public sector.
Phasing The proposed phasing of the borrowings is:
1978-79 1979-80 1980-81 1981-82
Sm9 20 12 1
A decision on the availability of funds is required
now to facilitate construction planning programmed to begin
in January 1979.
General Comments The infrastructure proposal is associated with a
private investment project that will contribute to the
development of national resources. The alumina project will
generate export income.
The construction of the Worsley refinery will provide
100 construction jobs initially, rising to a maximum of 1600
withan average of 1000 for the duration of the construction
period. The operation of the project will require 164 persons
employed at the mine site and 605 persons at the refinery.
THE PILBARA REGION POWER SUPPLY INTEGRATION ( WA)
Brief Description Because of the rapid development of the Pilbara since
the early 1960' s, electricity supplies in the region could not
be provided by the State Government and individual mining
companies developed their own electricity systems. The State
Energy Commission is seeking to progressively assume its full
normal role in the Pilbara region with the intention of ultimately
supplying all customers, industrial, commercial and residential.
The present fragmented approach to the provision of power in the
region is wasteful of resources. Currently there are ninety
one generating units spread over eleven separate medium sized
systems operated by five different organisations.
Funding Arrangements All capital. expenditure for the interconnections
0 and additional plant will be raised by the State Energy
Commission. In June 1978 prices $ 111 million will be needed
and the total amount is sought in the form of special additions
under the infrastructure financing guidelines.
Phas ing The timing of expenditures is estimated to be
million in 1979/ 80, $ 11 million in 1980/ 81, $ 15 million
in 1981/ 82, $ 16 million in 1982/ 83 and 1983/ 84, $ 27 million
in 1984/ 85 and $ 21 million in 1985/ 86. However this timing
will depend on the pace of development in the region which is
difficult to predict.
It is essential. that integration take place prior
to any further major expansion of the mining industry since
power facilities normally take longer to construct than a
mining expansion.
General Comments The proposal will contribute to a rationalisation
and more judicious use of resources. The existence of an
integrated power supply will lower the relatively high costs
of power involved in numerous small plants.
The proposal should help decentralisation and by
stimulating industrial demand lead to increased employment.
WATER SUPPLY PROJECTS ( TAS)
Brief Description Special additions are required over the next five
years to assist in the funding of peak capital expenditure
required for augmentation of and construction of new water
supplies in three separate areas of Tasmania. The projects
are: The augmentation of supply to the Hobart
metropolitan area by the Metropolitan
Water Board;
The construction of a regional supply
scheme by the North West Regional Water
Authority; and
Augmentation of the North Esk Regional
Water Supply by the Rivers and Water
Supply Commission.
Fundingz Arrangements Total capital expenditure on the three water schemes
in the five year period commenci ng 1978/ 79 is estimated to be
million at early 1978 prices. Allowing for amounts to be
funded from ordinary loan sources, special additions of
million are req~ uired.
Phas ing The special additions to borrowings are required
as follows: 1978-79 1979-80 1980-81 1981-82 1982-83
Sm 10 8 8 5 4
Project has a planned construction period of
six years and was commenced about one year ago. Project ( 3)
has beer. commenced and should be completed in 1980/ 81.
Project has not yet been started.
Any delays to the planned schedules of works relating
to all three projects will result in further shortages of water
and more severe rationing of domestic supplies.
General Comments Each of the projects makes use of Tasmania' s abundant
water resources and will contribute to industry development and
thus to employment. The projects have indirect implications
for Australia's balance of payments through the supply of water
essential to industrial processes.
S HYDRO ELECTRIC POWER DEVELOPMENT ( TAS)
Brief Description Special additions are sought over the next five
years to assist in the funding of peak capital expenditure in
the further development of Tasmania's hydro-electric power
system. Two specific projects will be involved, namely the
Pieman River Power Development and another, probably the
Lower Gordon Power Development. The Pieman Scheme was commenced
in 1975 and is now scheduled for completion in 1986.
Construction of the Lower Gordon Scheme is scheduled to start
in a substantial way in 1981/ 82.
Funding Arrangements At January 1978 prices total estimated capital
expenditure by the Commission for the five years commencing
1978/ 79 will be $ 347 million. After allowing for contributions
from internal funds and normal loan allocations, special
additions of $ 75 million are reouired.
Phas ing million per annum for the five years beginning
in 1978/ 79. The decision is required now to enable the capital
construction program to proceed as planned so that the power
system will be able to meet the demands placed on it.
General Comments Water is one of Tasmania's most widespread natural
resources and the large scale production of relatively low
cost hydro-electric power is a major factor in the development
of the Tasmanian economy. Production of additional power is
required to meet normal long-term growth as well as supplying
needed increments for major industries.
The Commission employs an outside construction force
of 900 men, together with additional support staff of at least
200.