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South Australian Resources: The one stop shop for investment: Dr Paul Heithersay, Deputy Chief Executive, DEPARTMENT OF MANUFACTURING, INNOVATION, TRADE, RESOURCES AND ENERGY (DMITRE)

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South Australian Resources: The one stop shop for investment: Dr Paul Heithersay, Deputy Chief Executive, DEPARTMENT OF MANUFACTURING, INNOVATION, TRADE, RESOURCES AND ENERGY (DMITRE), presented at …

South Australian Resources: The one stop shop for investment: Dr Paul Heithersay, Deputy Chief Executive, DEPARTMENT OF MANUFACTURING, INNOVATION, TRADE, RESOURCES AND ENERGY (DMITRE), presented at Mines and Money Australia 2013

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  • 1. Department for Manufacturing, Innovation, Trade, Resources and Energy South Australian Resources: The one stop shop for investment Dr Paul Heithersay PSM FTSE Deputy Chief Executive Resources and Energy Group 31 October 2013
  • 2. Mines and Developing Mineral Projects 2013 October 2013 2004
  • 3. South Australian Mineral Exploration Licences 2013 Applications Granted Renewed Transferred Surrendered CurrentTotal (Active) Exploration Licences 11 6 5 Nil 2 972 421,923.00 sqkm Mineral Claims 3 4 NA NA NA 109 16,874.58 Ha Mineral Leases Nil Nil Nil Nil Nil 896 99,627.61 Ha Extractive MLs Nil Nil Nil Nil 1 706 16,271.86 Ha Misc. Purposes Licences Nil Nil Nil Nil Nil 104 12,086.16 Ha Retention Leases Nil Nil Nil Nil Nil 40 47,896.70 Ha Area September 2013 January 2004
  • 4. RESOURCESTOCKS WORLD RISK SURVEY For the fourth consecutive year, South Australia is Australia’s best low risk destination for resources investment according to the RESOURCESTOCK World Risk Survey for 2013. Though South Australia leads within Australia, South Australia ranked 10th, behind Canadian provinces (TAS 12th, WA 13th, VIC 15th, Qld 16th, NT 17th and NSW 18th) Australia rated 6th out of forty countries up from 7th last year. “South Australia has again won the ‘battle of the states’, with its reputable mines and petroleum department bending over backwards as always to facilitate investment and its geology still highly regarded. Its oil and gas industry is booming in the Cooper Basin with links to multi-billion dollar LNG projects in Queensland and a guaranteed market in NSW and Victoria. On the mining side, the Eyre Peninsula is growing a reputation as “the Pilbara of graphite’ – to say nothing of the state’s well established copper, uranium, gold and zinc mining industry among others.” The survey is based on members of the global mining and petroleum sectors, including investors, supply companies who were asked to rank on perceived risk factors including financial, sovereign, land access, green and red tape, social risk, infrastructure, civil unrest, natural disasters and labour relations. 4
  • 5. MCA Scorecard of Approvals 2012, publ. June 2013 South Australia leads Australian and New Zealand mining jurisdictions securing the highest scores on 12/19 issues relating to the design and implementation of policies and regulations linked to mining approvals, maintaining its leadership position since the last scorecard release in 2006. ‘The SA system works well and is driven by a positive attitude toward mining which derives from the top echelons of government. This is reflected in a positive and assistive attitude by the Lead Assessment Agency which has been empowered by government to expeditiously seek whole of government solutions in approving mining projects’ The result confirms South Australia leads all jurisdictions in Australia and New Zealand for the majority of mining approval, environmental assessments and land access. 5
  • 6. South Australian Mineral and Petroleum Exploration Expenditure 1993/94 – 2012/13 Minerals and Petroleum exploration for 2012/13 was $616.7m ($230.4m – Minerals and $386.3m – Petroleum) 700.0 12.00% 600.0 10.00% 500.0 8.00% 400.0 6.00% 300.0 $ Millions 4.00% 200.0 2.00% 100.0 0.0 0.00% Minerals Petroleum SA % share of Australia Source: ABS Cat. 8412.0 6
  • 7. THE SOUTH AUSTRALIAN RESOURCE SECTOR Investment Fundamentals • Mining Lifecycle: • Exploration • Feasibility World Leading Deposits Copper • Equity, JV, Debt opportunities • $10+ billion in publically announced projects. 20 mines in 2013 Gold 30% of Australia’s economically demonstrated gold resources Uranium 78% of Australia’s identified resources Iron Ore • Development (including infrastructure) • Production 67% of Australia’s economically demonstrated copper resources 14 billion tonnes in identified resources 7 Minerals Sands Silver Coal Zinc Lead Graphite 4 mines in 2003 Rare earths Nickel Tin
  • 8. Mineral Exploration in Australia by Commodity 2012/13 South Australia – increasing share of Iron Ore (largest outside WA) maintaining 33% of Copper & significantly decrease in share of Uranium COPPER IRON ORE URANIUM Other $30.30 3% NSW $7.3 2% Other $10.2 15% Other $28.4 9% WA $76.6 24% NT $9.6 3% $319.3 million QLD $91.1 29% Source: ABS Cat. 8412.0 SA $106.3 33% SA $10.3 15% $69.5 million WA $35.1 50% Source: ABS Cat. 8412.0 SA $47.9 5% NT $11.3 1% QLD $3.9 6% NT $10.0 14% $1,011.3 million WA $921.8 91% Source: ABS Cat. 8412.0 8
  • 9. COPPER 3 operational copper mines 4 development projects 40 prospects 67% of Australia’s economically demonstrated copper resources Many of the deposits in South Australia’s copper provinces are covered by a sequence of younger rocks that have effectively hidden many large copper deposits from the early explorers. 9 For more information on copper please contact Invest in South Australia
  • 10. PRECIOUS METALS 4 operational mines 8 development projects 37 prospects 30% of Australia’s economically demonstrated gold resources Gold mineralisation is widespread in South Australia and occurs in most geological provinces. 10 For more information on precious metals please contact Invest in South Australia
  • 11. URANIUM 3 operational mines and 1 approved mine 78% of Australia’s identified resources 25% of the world’s uranium resources Olympic Dam – the world’s largest uranium deposit South Australia has an unusually high incidence of ‘felsic magmatic rocks’, these provide an excellent naturally elevated source for uranium. 11 For more information on uranium please contact Invest in South Australia
  • 12. IRON ORE 3 operational iron ore mines 20 development projects 14 billion tonnes in identified resources Forecast production of 105Mtpa by 2025 Forecast Iron Ore Production (Mtpa) 12 0 No rth Gaw ler Cra to n Sou th Gaw ler Cra to n Brae mar Provin ce 10 0 80 60 40 20 0 20 13 12 20 18 For more information on iron ore please contact Invest in South Australia 20 23 20 28 20 32 Source: Deloitte Regional Mining & Infrastructure Plan
  • 13. RESOURCES INFRASTRUCTURE $10+ billion in announced infrastructure Path to Market Projects 6 port projects, multiple slurry pipelines, rail upgrades Mine Infrastructure Projects 3 desalination plants, magnetite beneficiation plants Electricity transmission upgrades Eyre Peninsula, North Gawler Craton, Braemar Province Forecast Iron Ore Production (Mtpa) 12 0 No rth Gaw ler Cra to n Sou th Gaw ler Cra to n Brae mar Provin ce 10 0 80 60 40 20 0 20 13 13 20 18 20 23 For more information on resources infrastructure please contact Invest in South Australia 20 28 20 32 Source: Deloitte Regional Mining & Infrastructure Plan
  • 14. South Australian Major Mines and Projects - SARIG Current listing of Major Mines and Developing Projects Map on SARIG • resource / reserve data and production summary https://sarig.pir.sa.gov.au/Map/MapViewer/Display/Major%20Mines%20and%20Developing%20Projects 14
  • 15. Program for Accelerated Exploration (PACE) minerals.pir.sa.gov.au/pace2020
  • 16. Mapping buried mineral systems: enlarging buried target and provides framework for next drillhole
  • 17. Regional Mineral System Drilling An approximate 10x10 km drilling array would provide undercover mapping and detection of buried IOCG mineral systems in the highly prospective eastern Gawler Craton We are planning for this to commence in 2014 in collaboration with DET CRC researchers and emerging technologies
  • 18. OIL & GAS Emerging unconventional oil & gas boom South Australia’s history of oil and gas exploration extends back to 1866 w ith the first oil exploration in the Otw ay Basin. South Australia has 14 petroleum basins (12 onshore, 1 offshore, 1 on-and-offshore), however currently only three are producing commercial hydrocarbons. COOPER BASIN The Cooper Basin is a w orld class hydrocarbon province (Australia’s largest & most mature onshore) and has been the centre of South Australia's exploration and development activities for 50+ years. The Cooper Basin is emerging as a m ajor unconventional gas resource with existing oil and gas processing and transport infrastructure connecting the basin nationally to major cities and LNG export m arkets. OTWAY BASIN Otw ay Basin contains both mature and immature conventional and unconventional oil and gas plays, w ith high potential for further discoveries. The onshore area is regarded as the State’s second most prosperous petroleum basin BIGHT BASIN The Bight Basin is of similar size to the Niger Delta, how ever, is significantly less explored. To date, most exploration drilling in the Bight Basin has focused on the margins of the Ceduna Sub-basin and the Duntroon Sub-basin. BP is currently undertaking a leading exploration prospect in this area. ARCKARINGA BASIN The Arckaringa Basin is emerging as a m ajor unconventional resource w ith independent reports highlighting the significant shale oil potential w ithin the basin. 18 Source: Department for Manufacturing, Innovation, Trade, Resources and Energy
  • 19. UNCONVENTIONAL GAS COOPER BASIN Beach Energy: PEL 218: CHEVRON FARMIN. Holdfast 1 2 MMscf/d after seven stage fracture stimulation of gas saturated Early Permian. Encounter, Holdfast and Moonta all flowed >2 MMscf/d. Moonta 1 1000m gas saturation. Beach estimate potential 300 TCF gas in place, ~100 TCF in shales and >200 TCF in sands. Holdfast 2 first horizontal well. Santos: High-side 200+ TCF recoverable raw gas. Booked contingent, probable, recoverable (Santos share) unconventional (shale gas, tight gas, deep coal) ~2.22 TCF (2,345 PJ) and target ~4.55 TCF (4,800 PJ) by 2015. Moomba 191 (vertical well): 2.6 MMscf/d from shales at line pressure, now flowing to market Senex Petroleum: PEL 516: Estimate 75-110 TCF gas in place in shales and coals. Extensive unconventional gas program commenced. Kingston Rule -1 flowed 1.2 MMscd/d; Hornet 1 >2 MMscf/d Strike, Beach: PELs 94, 95, 96: Mean prospective resource estimate 12.4 TCF gas and 113 MMbbls liquids in coals and shales
  • 20. Roadmap for Unconventional Gas Designed to inform industry strategies, government policies, and regulations to facilitate unconventional gas projects in ways that communities welcome. Includes prospectivity, company projects, SE Australian gas economics, regulatory framework, supply chain needs etc. Released 12th Dec 2012. Available for free download at: www.petroleum.dmitre.sa.gov.au The Roundtable has >300 members (companies, government agencies , service sector, peak representative bodies, universities).
  • 21. Free SmartPhone App for South Australia Mining Investors…
  • 22. Further Information Please contact Invest in South Australia for detailed investor-ready information across copper, gold, uranium, iron ore and resources infrastructure. Invest in South Australia Level 9, The Conservatory 131-139 Grenfell Street Adelaide, South Australia 5000 T: +61 8 8303 2400 F: +61 8 8303 2410 E: investinsa@sa.gov.au www.invest.sa.gov.au Published October 2013 The information contained in this pres entation has been compiled by the Department for M anufac turing, Innovation, Trade, R esources and Energy (DMITRE) and originates from a variety of s ourc es. Although all reasonable care has been taken i n the pr eparation and c ompilation of the information, it has been provided i n good faith for gener al information onl y and does not purport to be professi onal advice. No warranty, express or implied, is given as to the completeness, correctness, accuracy, reliability or currency of the materials. DMITRE and the Crown in the right of the State of South Australia does not acc ept responsi bility for and will not be held liable to any recipi ent of the information for any loss or damage however c aus ed (including negligence) which may be directly or indirec tly suffer ed as a consequenc e of us e of these materials. DMITRE reserves the right to update, amend or supplement the information from time to time at its discretion.