Western Australia’s National Party may rely on mining profits for its royalties for region’s fund, but one of its parliamentarians says agriculture should be favoured ahead of mining in any dispute over water rights.
Grant Woodhams, the Geraldton based speaker of WA’s lower house, has also urged mining companies to consider desalination rather than using limited groundwater supplies.
Mr Woodham’s comments come as the $2 billion Karara iron ore project in his mid-west electorate is seeking a license to pipe groundwater 140 kilometres to its mine from one of the nation’s most productive grain growing regions.
Gindalbie Metals has applied for a five gigalitre licence, about 80 per cent of the available recharge from a subsection of the Parmelia Aquifer. The water is beneath Mingenew, a region known as Australia’s golden triangle of lupin production.
The Mid West is on the verge of a mining boom with about 13 billion tonnes of iron ore pegged, worth an estimated $1.3 trillion.
But most of the ore surveyed is magnetite, a lower grade product that needs water to be processed for China’s steel making industry.
Gindalbie’s Karara mine is a joint venture with Ansteel, China’s second largest steel manufacturer and is expected to generate up to $150 million in exports over the next 30 years.
“What we are doing is taking a low grade 36 per cent iron and producing a 68 per cent iron product so it’s a premium iron product,” Gindalbie’s managing director Garret Dixon said.
“The iron ore market will soften and what you will see is a Karara iron ore still being in great demand.
“It’s a great long-term industry because we’re actually doing a lot more value adding in Australia instead of loading, shipping and putting all that value somewhere else.”
Mr Woodhams says he supports the emerging iron ore industry in his Moore electorate, but mines such as Karara should be using desalinated water.
“If they can’t afford to put a desalination plant in, they’ve got to rely on the natural resource of an aquifer, potable water from there, well there must be a very thin margin in their operation,” he said.
Mr Dixon says the Gindalbie has investigated desalination but its pipeline proposal is cheaper and better for the environment.
“Desalination also brings in the other issues about disposing of the salt effluent itself in the area and also brings into that issue which has just arisen about carbon footprint because you need a whole heap of energy,” he said.
First come first served
Gindalbie has applied for its water licence under WA’s first come first served water policy and must prove it can source a sustainable supply.
Western Australia’s Water Minister, Bill Marmion, says the company has followed the process and is entitled to the water free of charge if it can prove it is sustainable.
“One of the benefits of someone applying for a water license like Karara is they have to do a lot of geotechnical work and indeed, I understand they spent about $3 million,” he said.
“There’s been a scarcity of information but the $3 million worth of work that they’ve done has been able to inform the Department of Water of the geotechnical side of the area which has actually helped them to assess the application.”
WA’s Conservation Council says the Karara application highlights a flawed system that needs to be fixed before the Mid West mining boom really takes off.
The council’s director Piers Verstegen says the true impact on agricultural land and groundwater dependent wetlands needs independent assessment.
“Well it’s completely inappropriate for the government to rely on the proponent and industry, who have got a vested interest in using as much of that water as they can get hold of, to determine how much to allocate to that use,” he said.
“We just don’t know what the sustainable yield of these ground water resources are and if we go allocating huge volumes of groundwater to mining companies we really don’t know what impact that’s going to have on future land use or indeed the environment in those areas.”
In 2008 the CSIRO and WA’s Department of Water conducted a study of groundwater reserves throughout the south-west of WA.
The study concluded there was “very low confidence” in the understanding of groundwater reserves in the mid-west.
Mingenew farmers petitioned State Parliament last year opposing the Karara application.
Grain and fat lamb producer Peter Horwod has been leading the campaign against the pipeline.
“I don’t think anywhere in the world they’ve got water policy right and I can just see WA, we haven’t utilised all our resources and we’ve got to get it right before it’s too late,” he said.
Mingenew tree nursery owner Ian Pulbrook says the Karara mine will need more than double its five gigalitre current application as the mine grows and this will prevent businesses such as his from expanding.
He wants to develop a horticulture industry alongside his tree nursery.
“This is highly potable, valuable, fresh water and it’s going to be used to wash rocks,” he said.
“It just shows a total lack of recognition of the agricultural industry and horticulture and what we need in water resources.
“I can see it ending up like the Murray Darling where they’ve over allocated water and there’ll be no water left for the people to develop in the mid-west and that’s the issue.”
Jumping the gun
The Karara application will not be determined until next month but Gindalbie is already building its $200 million pipeline and associated infrastructure.
Western Australia Greens water spokesperson, Alison Xamon, says it appears the company has been given a green light for the project.
“I think that the interesting issue about what is happening with Karara is it almost becomes a microcosm of the broader issues facing this state in relation to water and mining,” she said.
“The reality is that we have a very dry state and certainly potable water sources are a rarity in this state and need to be treasured.
“What we have seen to date has almost been unfettered approval of all mining applications by this government and now we’re starting to see, in very real terms, the way that this unfettered approach is starting to impact really quite adversely on existing land uses, in particular what it means to the farmers.”
Mr Woodhams says the Nationals want WA’s water policy reviewed and that agriculture should have first preference over the state’s limited fresh water resource.
“I’d advocate that in any circumstances where you have a water resource, part of that should be absolutely quarantined for food,” he said.
“Without having any argument with the proponents of this particular license (Gindalbie Metals), I do believe that for all of our security in Australia, any water resource, under any pressure from anybody, part of it needs to be quarantined for food, absolutely.”
