Resource sector on cusp of another surge
BY 2020 the Queensland resources industry will require an additional 40,000 workers, and the Bowen Basin's non-resident workforce population would have blown from 29% to 48%, according to the Queensland Resources Council Growth Outlook Study released yesterday.
The Deloitte Access Economics study, prepared with the co-operation of QRC member companies, said all available evidence pointed to the Queensland resources sector being on the cusp of unprecedented expansion, with royalties alone expected to rise by almost 300% by 2020 under the "full-growth scenario".
However, a shortage of supply - particularly with labour, water and electricity - could slow the sector's growth and prevent it from reaching its "full potential".
While capital expenditure on resource projects in Queensland in 2011 is expected to be almost double that achieved at any point prior to the GFC, the current labour market settings will fail to meet expectations and requirements, the study concluded.
Even if only half of the 66 projects identified by the study proceed, many of the constraints identified would still emerge.
By 2013 capital expenditure in the resources sector will be almost three times current levels, but under the 'full growth scenario', an extra 40,000 workers, 5000MW of electricity and almost 200,000ML of water will be required.
With electricity alone, to meet short-term demand every single proposed power station in Queensland would have to be built. No matter what, undersupply seems "likely" in the medium to long-term.
From 2001 to 2011 Queensland's resources sector employment grew by 40,000, over the next decade, we will see a re-run.
QRC chief executive Michael Roche said it was "no secret that the state's resource communities are feeling the strain of the last growth surge and there is limited, if any, appetite for another round given the lag-time in infrastructure and social service funding from governments".
"These are challenges that will need to be addressed as they will emerge, albeit in reduced form, if only half the projects on the drawing board proceed," he added.
He said the study provided a vital guide for industry, governments and communities in the interests of maximising the statewide benefits from an unprecedented expansion of the Queensland minerals and energy sector.
He argued that with most companies likely to favour FIFO workforces in the future, the benefits of the mining boom will spread across the state.
"If all these projects proceed, they will - among other significant socio-economic contributions to the economy - boost state royalties to almost $8 billion a year by 2020.
This is almost three times the $2.8 billion dollars banked in the 2010-11 financial year," Mr Roche said.
"Industry growth of this magnitude is unprecedented but not beyond the capacity of either Queensland or Queenslanders to embrace in the state and the nation's long-term interests.
"The world is changing before our eyes as developing nations reach out for a lifestyle that we take for granted."
Mr Roche said few regions anywhere in the country are likely to face population growth pressures of the magnitude projected for towns in the Bowen Basin.