Update: 2012 to 2018 – The planned open-pit mega-expansion was abandoned in mid-2012 – but other, more modest expansion plans are being progressed and explored.
2011 – The SA Greens and FoE Adelaide have been doing great work drawing attention to the many problems with the planned expansion of the Olympic Dam uranium/copper mine. Sadly, the expansion has been approved and critics (especially the SA Greens) have been subjected to a disgraceful smear campaign by the SA Labor government and the Murdoch press for raising questions about the expansion and the enabling legislation – the Roxby Downs Indenture Act. They have been accused of holding the state’s economy to ransom for raising legitimate questions and proposing amendments to the Indenture Act. The SA Liberal Party has acknowledged that every aspect of the Indenture Act favours BHP Billiton at the expense of South Australians – yet the Liberals did not propose or support amendments. Unfortunately the legislation passed through the SA Parliament in November 2011.
Dark day as state laws trashed in Roxby riches rush
29 November 2011
The Parliamentary debate over the Roxby expansion Indenture Bill has confirmed that the State Government has delivered a bad deal for South Australia, says Greens Parliamentary Leader Mark Parnell.
“This is a dark day for our State’s democracy. The Government has locked in for the next 70 years the right of the world’s richest resource company to over-ride all relevant State laws,” said Mr Parnell.
“The hours of debate in Parliament has shown that in the rush to get this deal signed before ex-Premier Rann departed, the State Government has given too much away for too little in return.
“The environmental costs are going to be much higher, and the economic return will be much lower than the SA public rightly expect.
“Parliament has exposed the yawning gap between the Government’s hyperbolic spin over the Roxby riches and the dark reality of this terrible deal.
“Future generations are going to be disgusted with us for giving their resources away for a pittance and leaving them to deal with the enormous toxic legacy of managing the world’s largest radioactive waste dump,” he said.
The Greens put forward a package of amendments that would have positively transformed the Indenture contract.
The controversial Bill has now passed both houses of State Parliament, with only the Greens voting against it.
What the debate exposed:
• The local jobs, manufacturing and local procurement Plan will contain ‘aspirational’ targets only. Not one extra job is guaranteed.
• The ‘net’ economic return to state coffers in years 10-20 of the project could be as low as $10 million / year – and that’s even before millions are given back to BHPB through Federal subsidies like the diesel fuel rebate.
• No explanation for locking in royalty rates at a low rate for 45 years – apart from that is what BHP wanted.
• The Government did not do any comparative economic analysis with similar projects interstate and overseas to see if we were getting a good economic deal.
• There is nothing the Government can do to make BHPB expand their domestic processing up to an additional 200,000 tonnes of ore (as has been promised by the Premier and others). In fact, there is nothing to stop BHP exporting all ore from Roxby Downs to China (including the ore that is currently processed here).
• Govt has relied entirely on BHPB’s figures for the cost of processing in SA rather than exporting South Australian copper ore to China.
• BHPB can continue to extract fossil water from the Great Artesian Basin until 2082, with costs capped for the next 30 years.
• Third parties won’t have any right to access the railways, roads, ports and airports being constructed for the expansion.
• No cumulative impacts of this expansion (beyond the artificial EIS timeframe of 40 years) have been considered.
• The Government doesn’t know what impact the ODX will have on the State’s greenhouse pollution reduction targets.
• The toxic tailings waste dams have been deliberately designed to leak.
• The final operating conditions to protect the marine environment at Point Lowly will not be known for years and will be negotiated in secret.
Letter published in The Advertiser
To mention just one of the indefensible aspects of the Roxby Downs Indenture Act, the legislation retains the exemptions from the Aboriginal Heritage Act 1988. Traditional Owners were not even consulted. The government’s spokesperson in Parliament said: “BHP were satisfied with the current arrangements and insisted on the continuation of these arrangements, and the government did not consult further than that.”
Recently it has been revealed that the ‘clean up’ of the Maralinga atomic test site was flawed and will most likely need to be revisited. We shouldn’t be surprised – in 2002 nuclear engineer Alan Parkinson warned that “What was done at Maralinga was a cheap and nasty solution that wouldn’t be adopted on white-fellas land.”
In 1999, SA police pepper-sprayed an 11-year old Adnyamathanha girl at the Beverley uranium mine, and an Adnyamathanha man was evicted from a public forum for suggesting that the meeting be chaired by a Traditional Owner rather than a Liberal MP.
Clearly there is a pattern. It should be enshrined on SA number plates: ‘SA: The Racist State’.
WHAT THE GREENS WANT TO KNOW
November 9, 2011
SA Greens MLC Mark Parnell will put forwared 100 amendments to the Olympic Dam indenture Bill. Greens MLC Mark Parnell said his minority party was “not going to be cut short and stopped from asking the questions that need to be asked”, despite bipartisan support from Labor and the Liberals.
Why did the Government lock in a royalty regime for 45 years, and why is it based exclusively on old-style production-based royalties, rather than one that captures a fair share of mining profits?
2. ECONOMIC RETURN
How good an economic deal did SA receive when BHP CEO Marius Kloppers is claiming to his shareholders that the Olympic Dam Expansion will be low cost and highly profitable?
3. PROCESSING IN SA RATHER THAN CHINA
How many South Australian jobs will be lost by not requiring BHP to process our ore here in South Australia rather than exporting it to China?
4. EXEMPTION FROM SA LAWS
Why is BHP exempt from over 20 South Australian laws that every other mining company in SA has to comply with?
5. NO URANIUM OPTION
Why wasnt a No Uranium Roxby Expansion considered when we know it is not only technically feasible, it would also mean less water and energy use and more jobs as the processing would be done here in SA, rather than in China?
6. GREAT ARTESIAN BASIN
Why isn’t there a plan to wean BHP off using 42ML/day of ancient water from the Great Artesian Basin, when they plan double that volume in excess capacity (80ML/day) from their desalination plant?
7. DESALINATION PLANT & CUTTLEFISH RISK
Why is the Government prepared to risk the breeding grounds of the Giant Australian Cuttlefish by not requiring the company to build in a different location?
8. RADIOACTIVE LEAKAGE FROM TAILINGS DAM
How can the Government claim that they have met their public commitment for the expansion to meet worlds best environmental practice when only 4 per cent of the tailings dams will be lined and the dams are designed to leak up to 8 million litres of toxic radioactive waste liquid/day?
9. RESPONSIBILITY POST MINE CLOSURE
Who will ultimately be responsible to manage the open pit, tailings dams and rock waste pile for the 10,000 years after the operations cease that the radioactive risk remains: the company or SA taxpayers, and how much will that management cost?
10. GREENHOUSE POLLUTION & RENEWABLE ENERGY
Why isn’t the company committing to any investment in cleaner energy to meet their whopping 650 MW electricity demand beyond the 57MW commitment for powering the desal plant (less than 10 per cent of total demand) to reduce their enormous increase in the states greenhouse pollution of 12-15 per cent?
A case of Olympian incompetence by South Australia
By Paul Cleary, The Australian, October 21, 2011
THE royalty agreement negotiated by South Australia for BHP Billiton’s Olympic Dam expansion has robbed the state’s citizens and all Australians of the opportunity to share in the profits of what will become the world’s biggest mine.
This deal is a monumental example of state government incompetence when it comes to acting as custodian of the nation’s mineral wealth.
South Australia has agreed to a regime based solely on percentages and even cents per tonne of the mine’s production. Mike Rann, who stands down today as Premier, has done South Australians a disservice that will cost them dearly for almost half a century.
Rann and his administration should know full well that these royalties fail to capture a fair share of mining profits. This has been in the economic literature since the 1970s and was made more prominent by the Henry review. Yet the deal does not contain a single element of profits-based taxation.
The case for such measures is all the more compelling given that the mineral resources rent tax will not tax the millions of tonnes of copper, uranium, silver and gold the mine will be produce under the 45-year agreement, because the MRRT only applies to coal and iron ore.
Given that this is an agreement negotiated in the 21st century, it beggars belief the state could have agreed to a regime based exclusively on production-based royalties that hark back to medieval times.
But none of these ideas penetrated the thinking of the South Australian government when it negotiated its 45-year agreement for BHP’s $30 billion expansion.
The three-tier regime involves 3.5 per cent for refined mineral products, meaning copper and gold, and 5 per cent for uranium oxide and uranium-bearing copper concentrates.
There’s also 35c per tonne on extractive minerals sold to a third party, but this is not even indexed for inflation, so its value will diminish over the life of the agreement.
When asked to explain how the government could have agreed to a non-indexed royalty, a spokesman said it was a trade-off in negotiations because BHP had asked for the expansion to gain concessional royalty rates for new mines. Well, that issue should not have even been on the table, because Olympic Dam is an existing mine.
The spokesman declined to say why a profits-based regime had not been considered.
This agreement will unfortunately stand as a sad and enduring indictment of the weakness of our state governments when it comes to negotiating with powerful mining multinationals.
The power of BHP was abundantly evident when it signed the agreement with the South Australian government on its home turf in Melbourne, rather than in Adelaide, and then declared that its board had already pre-committed $1.2bn in investment ahead of approval by the state and federal parliaments.
Given the environmental legacy of this mine, including above-ground storage of radioactive tailings and risks to water resources, a profits-based royalty could have been paid directly into a sovereign wealth fund. This fund could be used to compensate future generations who will most certainly have to live with greatly depleted mineral resources, and the environmental consequences of this mammoth venture.
These risks were glossed over by Environment Minister Tony Burke when he approved it under federal law. Burke’s description of the project is even more euphemistic than what is found in BHP’s environmental impact statement.
At no point in his media statement did Burke use the word radioactive. At least BHP’s EIS admits that its tailings heap will be.
Even glossier was Burke’s acceptance of the claim that seepage from the radioactive tailings storage facility would be “neutralised” 4m below the surface by limestone that is 60m deep. None of Burke’s three media advisers responded to questions last week.
BHP is less certain than Burke. Its draft EIS says the mine’s impact on groundwater would “depend” on various unknown factors, such as the “interaction of seepage with the sediments beneath the respective facilities”.
The EIS says that up to 8.2 million litres would seep from the TCF into groundwater each day in the first 10 years of operations, before falling to about 3.2 million litres a day.
Gavin Mudd, a senior lecturer in Monash University’s school of engineering, says BHP “got the lowest cost option on every front”, especially for above-ground storage of radioactive tailings. This is contrary to the practice employed with the Ranger uranium mine.
Mudd says the uncertainty flagged by BHP relates to the way water seeps into limestone creates caves; an imperfect mixing of water into the sediment could cause channels to open up, allowing massive volumes of water to flow into Lake Torrens, less than 100km from the mine.
“You will get these channels opening up — it is the nature of limestone. They have always underestimated seepage. Despite their claims, they still don’t understand as well as they need to to justify their claims,” he says.
The BHP spokeswoman, however, says that the company has been operating tailings storage since 1989, giving it “a long and deep understanding of how they work”.
Mudd, however, points to a 1991 incident in which the mine lost 3 million litres of water in three hours.
BHP argues that its field investigations and modelling have been “peer reviewed and assessed by state and federal government experts”.
Mudd says the process is flawed because the government is “very reliant on data that comes from the company”.
For a project of this nature and magnitude, with inherent risks for future generations, taking out insurance in the form of a future fund is clearly warranted.
But this won’t happen with the royalties agreed to by the myopic state government.
Olympic Dam – summary of the problems with the mine
Updated May 2009 following the release of the Draft EIS for the proposed mine expansion.
2012 update: the planned mega-expansion, discussed below, was cancelled in 2012
THE MINE EXPANSION
On May 1, 2009, BHP Billiton released a Draft Environmental Impact Statement (EIS) promoting its plans to turn the Olympic Dam (Roxby Downs) mine in South Australia into the largest uranium mine in the world.
The Olympic Dam uranium deposit is by far the largest on earth. Although the uranium is low-grade, the volume is staggering, amounting to about 2.4 million tonnes (and counting) − 30% of the world’s known conventional uranium reserves. That’s enough uranium to fuel the world’s fleet of 430 power reactors for 40 years.
The mine has been operating since the late 1980s using underground mining. BHP Billiton plans to supplement underground mining with open-cut mining − it plans to make Olympic Dam the largest open-cut mine in the world by digging a pit of about 14.4 cubic kms (4.1×3.5×1 kms). Export of uranium is expected to increase from an average of 4,500 tonnes per year to 19,000 tonnes per year. Copper production is expected to increase from 180,000 tonnes per year to 750,000 tonnes per year, and production of gold and silver is also expected to increase.
The plan would lock Australia in as the world’s uranium quarry and fuel unresolved nuclear waste management problems and unacceptable WMD proliferation risks.
BHP Billiton expects government approval in mid-2010 and will then make final decisions on the scope and timing of the expansion project. A company representative said on the day the EIS was released: “We still have a lot of work to do before we can tell you when this project may start and how much it may cost.”
At the mine site (most information from the Draft EIS):
* The quantity of ore to be processed would increase from 12 million tonnes annually to 72 million tonnes.
* The existing smelter would be expanded and new concentrator and hydrometallurgical plants would be built to process the additional ore, and generate additional concentrate for transport.
* It would take about five years of mining to remove the layer of overburden and expose the first section of the ore body. During this time, about 410 million tonnes per annum of material would be removed from the open pit. Over 40 years, the footprint of the pit would grow to be 14.4 sq kms. The overburden would be used for a ‘Rock Storage Facility’.
* On-site production of refined copper would increase to 350,000 tonnes annually (about twice the current output).
* About 1.6 million tonnes of concentrate would be exported to China annually for further processing, yielding about 400,000 tonnes of refined copper along with several thousand tonnes of uranium and some gold and silver.
New or upgraded infrastructure to support the mine would include (most information from the Draft EIS):
* A 280 megalitre per day (ML/d) coastal desalination plant at Point Lowly on the Upper Spencer Gulf (to supply 200 ML/d of additional water via a 320 km pipeline connection to Olympic Dam and with the potential to supply 80 ML/d elsewhere).
* Either a new 270 km electricity transmission line from Port Augusta to Olympic Dam, and/or a gas pipeline from Moomba and a new gas-fired power station at Olympic Dam.
* A 105 km rail line to connect Olympic Dam to the national rail network near Pimba.
* A new airport to replace the existing airport at Olympic Dam.
* A landing facility on the Upper Spencer Gulf to unload equipment from barges, and an access corridor to a pre-assembly yard on the north-western outskirts of Port Augusta.
* Additional port facilities in SA at Outer Harbor and in the Northern Territory at the Port of Darwin to import supplies and export product
* A new accommodation village for workers.
* Expansion of the Roxby Downs township.
Waste and Weapons
Uranium production at Olympic Dam is expected to increase to 19,000 tonnes per year, sufficient to fuel 95 power reactors which will produce 2,850 tonnes of high-level nuclear waste per year (in the form of spent nuclear fuel). That amount of spent fuel contains 28.5 tonnes of plutonium − enough for 2,850 nuclear weapons each year. Over the lifespan of the mine, it could be responsible for the production of enough plutonium for over 340,000 nuclear weapons. If 99.9% of that plutonium is adequately safeguarded, the remaining 0.1% would suffice to build 340 plutonium bombs similar to the one that destroyed Nagasaki in 1945.
This is all the more troubling given the flaws and limitations of the international nuclear ‘safeguards’ system. A BHP Billiton EIS ‘infosheet’ states that safeguards arrangements “ensure that Australian uranium is used exclusively for peaceful purposes” and is “accounted for in full”. In fact, safeguards fall far short of “ensuring” peaceful use of uranium exports and Australia’s uranium exports are not fully accounted for – there are routine accounting discrepancies (known as Material Unaccounted For). International Atomic Energy Agency Director-General Dr. Mohamed El Baradei has acknowledged that the IAEA’s rights of inspection are “fairly limited”, that the safeguards system is subject to “vulnerabilities” and “clearly needs reinforcement”, that efforts to improve the system have been “half-hearted” and it operates on a “shoestring budget … comparable to a local police department.” (More information on safeguards <www.nuclear.foe.org.au/safeguards>.)
BHP Billiton sells uranium to nuclear weapons states, states refusing to ratify the Comprehensive Test Ban Treaty, states blocking progress on a Fissile Material Cut-Off Treaty, states with a history of secret nuclear weapons research, and states stockpiling ‘civil’ plutonium.
A new low was set in 2006 when the federal government, with BHP Billiton’s support, negotiated a uranium export agreement with the secretive, repressive, militaristic, undemocratic regime in China. The Olympic Dam expansion is heavily dependent on the export of concentrate to China, leaving over one million tonnes of long-lived radioactive wastes each year for China to manage into the future. BHP Billiton intends to transport this radioactive concentrate by train through central Australia and out through the Port of Darwin. Communities and environments will be placed at risk by these hazardous bulk cargoes from Alice Springs to Darwin and across China − and none of these communities will be given a right to refuse these risks.
Dean Dalla Valle, head of BHP Billiton’s uranium division, said on May 1: “Exporting uranium to new customers like China will be an integral part of creating value from the Olympic Dam ore body. We can do this with confidence because China is subject to the same strict safeguards arrangements as all of our other customers.”
However, China is not subject to the same safeguards arrangements as all other customers. As one of the ‘declared’ nuclear weapons states, China’s safeguards are voluntary. Assoc. Prof. Tilman Ruff noted in a 2007 paper that of the 44 proliferation-sensitive nuclear facilities in China, only 10 facilities were eligible for IAEA safeguards, only three had actually been inspected, and only one had a full suite of IAEA safeguards arrangements in place (Briefing Paper #19 at <www.energyscience.org.au>).
Australia should not sell uranium to any nuclear weapon state and must not turn a blind eye to their failure to comply with their nuclear disarmament obligations under the Nuclear Non-Proliferation Treaty, or to Russia’s illegal threat to use nuclear weapons against Poland in 2008 over US missile defence plans, or to China’s continuing practice of cultural genocide in Tibet and other human rights violations. An October 2008 Newspoll found that two-thirds of Australians oppose uranium exports to countries with nuclear weapons (73% of women and 51% of men).
The Draft EIS predicts global uranium mine production to double to about 92,000 tonnes of uranium oxide annually by 2030. The estimate is very optimistic. For a more realistic appraisal of the trajectory of nuclear power, see Schneider’s analysis in the Bulletin of the Atomic Scientists:
Under the mine expansion plan, the production of radioactive tailings, stored above ground, will increase six-fold to 58 million tonnes annually. The current tailings stockpile amounts to 100 million tonnes. BHP Billiton plans up to nine tailings dams in addition to the four that currently receive approximately 10 million tonnes of tailings annually, with their height increasing from the current 30m to 65m. The existing operation consists of 400 ha of tailings dams and 133 ha of evaporation ponds.
The tailings contain a toxic, acidic soup of radionuclides and heavy metals. There have been numerous spills and leaks – most significantly in 1994, when it was revealed that about three billion litres had seeped from the tailings dams over two years.
Mining consultants Advanced Geomechanics noted in a 2004 report that radioactive slurry was deposited “partially off” a lined area of a storage pond at Olympic Dam, contributing to greater seepage and rising ground water levels; that there is no agreed, accurate formula to determine the rate of evaporation of tailings and how much leaks into the ground; and that cells within a tailings pond covered an area more than three times greater than recommended, requiring “urgent remedial measures”.
The problems have not been resolved. Photos taken by an Olympic Dam mine worker in December 2008 show radioactive tailings liquid leaking from the rock ‘armoury’ of the tailings ‘retention’ system. The leaks were ongoing for at least eight months and probably amounted to several million litres, but were not publicly reported by BHP Billiton or the SA government. BHP Billiton said that mine workers taking and releasing photos of the mine would be subject to “disciplinary action”.
Managing the current tailings stockpile is challenging enough and there is every reason to be concerned about BHP Billiton’s capacity to manage a six-fold increase.
Large numbers of bird deaths have been recorded in the vicinity of the evaporation ponds − over 100 deaths in one four-day period in 2004. BHP Billiton says “several measures used to deter fauna from visiting the Tailings Storage Facility over the past decade have met with varying degrees of success, but none have resolved the issue.”
BHP Billiton likes euphemisms. ‘Tailings retention facilities’ retain some but not all tailings. The tailings dams have a ‘rock armoury’ – which leaks. Tailings dams are ‘storage facilities’ – as if to suggest that BHP Billiton has some plan for the waste other than leaving it where it is in perpetuity. BHP Billiton’s plans for Olympic Dam compare unfavourably with the Ranger uranium mine in the NT, where tailings are required to be returned to the pit at the end of the mine’s life and steps taken to ensure the tailings do not have a detrimental impact on the environment for at least 10,000 years.
(BHP to ‘dump mine tailings on ground’, Gavin Lower, May 01, 2009, The Australian, <www.theaustralian.news.com.au/story/0,25197,25411908-5013404,00.html>)
Nuclear power advocates like to compare the relatively small volume of waste produced by nuclear plants to the huge volume of waste produced by coal plants. However, to produce enough uranium to operate just one power reactor for just one year, Olympic Dam will produce 611,000 tonnes of radioactive tailings waste (58MT/95).
The Draft EIS states: “An estimated 12 cubic metres of low-level radioactive waste is produced at Olympic Dam annually in the form of personal protective equipment, laboratory equipment, and geological and processing sample wastes generated following analysis for radionuclides, but is not returned to the processing circuit. This would increase to 48 cubic metres annually on completion of the expanded project. After a review of disposal options and government approval in 2006, low-level radioactive waste has been packaged and disposed of within the TSF [Tailings Storage Facility]. Inventories of the waste and its disposal locations are recorded so that it can be managed in the event of future disturbance if the tailings were to be reprocessed. This disposal practice would continue for the expanded project.”
BHP Billiton proposes an increase in water consumption from 37 million litres daily (from the Great Artesian Basin) to over 250 million litres daily (up to 42 million litres from the Great Artesian Basin, plus 200 million litres or more from a proposed desalination plant).
That total of 250 million litres equates to over 170,000 litres per minute … every minute of every day in the driest state in the driest inhabited continent.
The water take from the Great Artesian Basin has had adverse impacts on precious Mound Springs − unique habitats which support rare and delicate micro flora and fauna, some species of which are unique to a particular Spring. While there is no current plan to increase the rate of water usage from the Great Artesian Basin, nor is there any intention to reduce it.
BHP Billiton’s Draft EIS says the company assessed and rejected the option of a third wellfield in the Great Artesian Basin: “The two existing wellfields supplying the current operation could not sustain the additional demand. It would have been necessary to establish a third wellfield much further into the GAB to ensure the GAB springs were protected. The resulting production of much warmer water would have been technically difficult and very expensive to cool to the required temperature and pipe to Olympic Dam.”
BHP Billiton pays nothing for its massive water take for the Olympic Dam mine despite recording a $17.7 billion profit in 2007-08. That arrangement is enshrined in the Roxby Downs Indenture Act 1982 − as anachronistic a piece of legislation as you’re ever likely to see. (BHP Billiton also has its hand out for more corporate welfare with an ask for around $120 million of public subsidies in the form of diesel fuel rebates over the four year open-pit construction period.)
In February 2007, then Prime Minister John Howard wrote to state Premiers seeking their agreement “to establish proper entitlements, metering, pricing and reporting arrangements for water extracted from the Great Artesian Basin.” Asked whether his proposed new arrangements would apply to Olympic Dam, Mr Howard said: “Everybody’s got to make a contribution to solving this problem.” But within days, he voiced support for BHP Billiton’s “right” to free water from the Artesian Basin. In other words, everyone except BHP Billiton has to make a contribution to solving this problem.
As The Advertiser noted in a November 2005 Editorial, it is “essential … to safeguard the artesian basin water supplies”. To that end, most users are subject to the Great Artesian Basin Management Plan. But BHP Billiton is a law unto itself − its Olympic Dam mine is not subject to the Management Plan and also enjoys exemptions from the SA Natural Resources Act 2004 and the Environment Protection Act 1993.
BHP Billiton has a bore-capping program which, the company claims, saves more water than the mine currently uses. But water extraction for the mine is localised and the adverse impacts are all too apparent to people who have monitored the Mound Springs over the past 20 years. Likewise, the company’s bore capping program is small comfort to pastoralists who suffer reduced water flow from the localised effects of water extraction for the mine.
The proposed desalination plant has raised concerns over its impacts on marine species and fishing industries – in particular from the discharge of brine. The Upper Spencer Gulf is a low flushing fragile marine environment unsuited to siting a desalination plant and BHP Billiton’s preferred site at Point Lowly is the breeding ground of the Charismatic Giant Australian Cuttle Fish.
David Noonan from the Australian Conservation Foundation said: “This is the worst possible place to build an internationally-sized desalination plant. The Gulf is shallow, low-flushing. It’s the breeding ground of the giant cuttlefish which is extremely sensitive to changes in salinity. The plant should be built on the ocean, not the gulf. We could build a reverse osmosis plant at Elliston on Eyre Peninsula’s west coast. Elliston has the ocean flushing that Pt Lowly lacks and enormous potential for year-round wind energy. Taxpayers are paying 20 per cent of the desalination plant’s capital cost and we should also have a big say on where it goes. It’s not good enough to leave it up to BHP.”
Adelaide University marine biologist Assoc. Prof. Bronwyn Gilanders says the sea around Whyalla is actually the world’s largest cuttlefish breeding zone, and that the plant could wipe them out: “Squids and Cuttlefish are generally short-lived. So they live a year; they breed only once. So if you damage the eggs or affect their reproductive ability then potentially that will have devastating consequences on the population.”
BHP Billiton expects the mine’s electricity consumption to increase over six-fold from 125 MW to 775 MW, to be sourced from some combination of supply from:
* the SA electricity grid (and the national electricity market) with a new electricity transmission line from Port Augusta.
* a proposed gas-fired on-site 600 MW plant with a pipe from Moomba.
* a proposed co-generation plant using industrial waste heat generated from the burning of sulphur to produce the sulphuric acid required for the new hydrometallurgical plant. This waste heat could be used to generate up to 250 MW.
The Draft EIS says a study is ongoing into the feasibility of a 150 MW concentrated solar thermal plant. Geothermal power is described as an “opportunity for the future”.
The proposed desalination plant would require 35 MW of electricity, which would be supplied by a new 25 km transmission line from the Cultana substation. The Draft EIS says the electricity would be supplied by renewable energy sourced from the National Electricity Market.
Mark Parnell from the SA Greens is advocating a 500 MW solar thermal plant for the mine:
“Large scale solar thermal is the ideal power solution for the expansion project. Solar thermal electricity is a different technology to solar photovoltaics (PVs). A PV system converts sunshine into electricity, whereas solar thermal converts sunshine to heat. This heat is then transferred to a fluid, which drives a turbine to generate electricity. A big advantage of solar thermal electricity is that the heat energy can be stored, potentially allowing electricity to be generated when the sun goes down.
“Solar thermal technology is available now, with 500MW plants currently planned for California and Nevada, where the technology has been road-tested for 20 years. Australia’s biggest engineering firm, WorleyParsons said last year it wants to build 34 large-scale solar thermal power stations in Australia by 2020. The Roxby expansion is the ideal project to kick-start this plan – the Olympic Dam mine needs huge amounts of power, in a spot that’s well away from the grid and bakes in the sun all year round.
“Investing in cutting edge renewable technology will provide a huge smart job boost for South Australia, placing our state at the centre of a new growth industry. The Rann Government must insist BHP Billiton’s enormous appetite for electricity is sated from the sun, not dirty fossil fuels. Otherwise, we’ll be left struggling with old technology and old thinking as the Roxby expansion sends our State’s greenhouse pollution levels sky high.”
Greenhouse emissions from the mine (and associated infrastructure) are projected to increase from 900,000 tonnes annually to 4.7 million tonnes, making it all but impossible for South Australia to reach its legislated target of 13 million tonnes. A technical assessment by Monash University engineering lecturer Dr Gavin Mudd estimates emissions would reach 4.5 to 6.6 million tonnes annually — one-third to one-half of the target of 13 million tonnes. (The technical assessment is posted at https://nuclear.foe.org.au/olympic-dam-uranium-copper-mine)
BHP Billiton likes to promote uranium as a fuel for low-carbon nuclear power – but that argument only holds if the comparison is with fossil fuels. According to the 2006 Switkowski report, nuclear power is three times more greenhouse intensive than wind power. Moreover, BHP Billiton wants to take credit for the alleged greenhouse benefits of its uranium exports but not for the WMD proliferation risks or the high-level nuclear waste legacy. Nor does BHP Billiton take any responsibility for the greenhouse emissions arising from the use of its extensive fossil fuel exports.
Dr Mudd said: “South Australia has a legislated greenhouse target to reduce emissions by 60%, limiting total emissions to about 12 million tonnes of carbon dioxide annually by 2050. Yet Olympic Dam alone will produce 4.5-6.6 million tonnes annually, making it virtually impossible for South Australia to meet its legislated target. BHP Billiton likes to take credit for its export of uranium to fuel low-carbon nuclear reactors, but that argument is flawed on two counts. Firstly, the end uses of energy exports are not counted in Australia’s greenhouse emissions, and if they were, BHP Billiton would also need to account for its extensive fossil fuel exports. Secondly, the argument rests on the arbitrary and implausible assumption that the only alternative to Olympic Dam uranium exports is to build coal fired power plants.”
Racism in the uranium mining industry in Australia typically involves ignoring the concerns of Traditional Owners insofar as the legal and political circumstances permit; divide-and-rule tactics; bribery; humbugging Traditional Owners – exerting persistent, unwanted pressure until the mining company gets what it wants; providing Traditional Owners with false or misleading information; and threats, most commonly legal threats.
BHP Billiton claims that it consults with Traditional Owners such as the Kokatha and Arabunna. But consultation is hardly the word since the company is under no obligation to take the slightest bit of notice of their views. The mine operates under the Roxby Downs Indenture Act, which provides overrides and exemptions from the SA Aboriginal Heritage Act 1988. The latter is the key law aimed at protecting Indigenous heritage in South Australia. However, under the Indenture Act, BHP Billiton is in a legal position to determine what consultation occurs with Traditional Owners, who is consulted, and nature of any consultation. The company decides the level of protection that Aboriginal heritage sites receive and which sites are recognised. The company claims that it fully complies with Aboriginal heritage legislation even though it is not required to do so – if so, why is the company unwilling to relinquish the legal exemptions it enjoys?
It is ironic that BHP Billiton supports Reconciliation Australia’s ‘good governance’ program and has provided over $2 million to Reconciliation Australia, yet will not relinquish its exemptions from the Aboriginal Heritage Act. The company’s attitude appears to be ‘do as I say, not as I do’.
One particularly notorious incident in the history of the Olympic Dam mine concerned the laying of a water pipeline on the land of Arabunna Traditional Owners in the mid-1990s, when WMC Resources owned the mine. The dispute over the pipeline led to violence, terrorism, imprisonment, and the death of one person. Jan Whyte and Ila Marks summarised the controversy in the July 1996 edition of the Friends of the Earth magazine, Chain Reaction: “It appears that WMC has embarked on a course of side-stepping consultation with the Arabunna as the traditional custodians. It has also taken similar actions in regard to the Kokatha, the traditional custodians for the actual mine site. One method used by mining companies to side-step proper consultation processes is documented in North America and Canada as well as Australia. Mining companies incorporate small Aboriginal groups in areas under dispute and give them financial support. These groups are then regarded as the official representatives for that area and mining companies proceed to consult with them. Thus, it seems as if the companies are going through the correct legal processes whereas, in fact, they are ignoring parties who have legitimate interests.” (See the full article and also the ABC ‘Background Briefing’ transcript at <https://nuclear.foe.org.au/watered-down-negotiations-wmc-picks-both-sides/>.)
Of course, BHP Billiton cannot be held responsible for the actions of WMC Resources over a decade ago. But it seems that little has changed, including BHP Billiton’s refusal to relinquish the overrides and exemptions it enjoys from the Aboriginal Heritage Act.
The Roxby Downs Indenture Act
The proposed expansion of the mine ought to be subject to legislative and regulatory controls and standards at least as rigorous as those that apply to smaller projects. To apply considerably weaker standards is indefensible. Yet the Roxby Downs (Indenture Ratification) Act 1982 provides BHP Billiton the legal authority to override important state legislation including the Aboriginal Heritage Act 1988; Environmental Protection Act 1993; Freedom of Information Act 1991; Natural Resources Act 2004 (incorporating water management issues); Development Act 1993; and the Mining Act 1971.
An indication of the sweeping nature of the legal privileges is the statement in the Indenture Act that:
“(1) The law of the State is so far modified as is necessary to give full effect to the Indenture and the provisions of any law of the State shall accordingly be construed subject to the modifications that take effect under this Act.
(2) Without limiting the generality of subsection (1), in the case of any inconsistency between the provisions of any Act or law and of the Indenture, the provisions of the Indenture shall prevail …”
The Indenture Act is currently the subject of secret negotiations between the SA government and BHP Billiton and is expected to be modified in the first half of 2010 to accommodate the mine expansion plans. The SA Labor government has refused to commit to repeal the legal privileges although they are clearly inconsistent with the government’s policy of applying the “strictest environmental standards” to uranium mining.
SA Premier Mike Rann said on the day of the release of the Draft EIS: “It [the mine expansion] has got massive benefits for South Australia but I will insist that world’s best practice in terms of environment is complied with.”
If Mr Rann was serious, he would immediately announce that the indefensible clauses in the Indenture Act will be promptly repealed.
Nor has there been any indication from BHP Billiton that it will relinquish the privileges although they are inconsistent with the company’s policy of meeting “internationally recognised standards”. Olympic Dam does not have to comply with South Australian standards let alone international standards. BHP Billiton Chairman Don Argus said in November 2006 that “we will apply the highest standards … we are acting within the law.” However, Olympic Dam does not operate within the law that applies everywhere else in SA.
Under confidentiality clause 35 of the Indenture Act, BHP Billiton has veto power over public release of information relating to activities undertaken within the 1.5 million hectares covered by the Indenture Act, and related matters such as government/company negotiations. Monash University environmental engineer Dr Gavin Mudd notes that: “until the Indenture Act is revoked entirely there can be no truly independent, external environmental assessment of the impacts of Olympic Dam.”
The Draft EIS (ch.6) says that the Indenture Act “ensures the continuation … of a safe and environmentally acceptable operation”. It does nothing of the sort.
Friends of the Earth https://nuclear.foe.org.au/olympic-dam-uranium-copper-mine/
Dr Gavin Mudd’s articles on Mound Springs, Great Artesian Basin etc http://users.monash.edu.au/~gmudd
SA Greens MLC Mark Parnell http://sagreens.markparnell.org.au/
Waste fears at uranium mine
Michelle Wiese Bockmann, The Australian, 10 March 2006
THE Olympic Dam uranium mine needs urgent improvements in radioactive waste management and monitoring, according to audit reviews. As owner BHP Billiton seeks state and federal government approval for a four-fold, $5 billion expansion at Olympic Dam, concerns about the mine’s tailings storage facilities have been raised in the last two audit reviews provided to the Rann Government.
The reviews, obtained by The Australian under Freedom of Information laws, call on government regulators to “encourage” changes to the deposit of tailings, a radioactive slurry that is a by-product of uranium mining production. More than 10 million tonnes of tailings a year are placed in ponds near the mine.
The review noted radioactive slurry was deposited “partially off” a lined area of a storage pond, which it believed contributed to greater seepage and rising ground water levels.
The review also criticises the lack of an agreed, accurate formula to determine the rate of evaporation of tailings and how much leaks into the ground.
Consultants Advanced Geomechanics conducted the reviews of the tailings storage facilities in 2002 and 2003 when the mine was owned by WMC Resources. In a September 2004 letter to state Department of Primary Industries and Resources, Advanced Geomechanics consultant Richard Jewell urged “strong representation to the operators on these issues to make the changes”.
In April last year, Mr Jewell noted cells within a tailings pond covered 70ha, more than three times greater than a key performance indicator recommended.
“This is an issue of real concern and requires the implementation of urgent remedial measures,” Mr Jewell warns in the letter. He agrees with the auditors’ general conclusion that the tailings facility was “well managed”.
The tailings dams were the subject of a 1996 parliamentary inquiry after previous owners Western Mining Corporation reported in 1994 that five million cubic litres had leaked from them over two years.
“They (the mine owners) have a continuing problem with managing radioactive tailings and a continuing problem with seepage of tailings,” said Australian Conservation Foundation official David Noonan.
Mr Noonan said the audit reviews showed the mine “had failed even the most basic monitoring practices”.
Mr Jewell yesterday confirmed the 2004 auditors had again raised the tailings problems. “But in general from my experience the management at Olympic Dam is as good as I’ve seen anywhere in the world,” he said.