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Downstream benefits expected in Kwinana

HAVING been given the green light by the State Government, Rio Tinto’s $400 million HIsmelt pig iron plant is expected to generate a raft of opportunities for new industries.

However, while potentially providing a boost for new industries, a detailed economic impact study (EIS) of the Kwinana industrial area commissioned by the State Government and the Chamber of Commerce and Industry of WA, together with local councils, puts the financial contribution of the new plant into perspective.

Understood to be the first in-depth study of its kind carried out in Australia, the EIS found that annual output from the region already is worth $8.7 billion once multiplier and capital investment effects are considered.

The existing Kwinana industries also have capital expenditure plans of $812 million over the next five years and an additional $1.2 billion for the subsequent five years.

Over the past 12 years, since a review of Kwinana was last carried out, sales from the Kwinana industrial strip have risen 50 per cent, while employment has risen 16 per cent.

The latest study, undertaken by consultants Sinclair Knight Merz, found direct sales from the area account for $4.34 billion per annum compared with $2.9 billion in 1990, of which $1.58 billion is exported overseas, while a further $326 million is sold interstate.

The study found that Kwinana accounted for 22.2 per cent of manufacturing income in WA, while the total income, which measures wages, salaries and gross margins before tax or depreciation was $1.27 billion, or 2 per cent of WA total income of $62.4 billion.

Besides the HIsmelt project, Coogee Chemicals Pty Ltd has received works approval for the construction of a 55,000 tonne per annum aluminium fluoride plant. The company also has plans for a zeolite production facility.

Western Power Corporation has commenced civil works for the construction of a 240MW gas-fired combined cycle plant, expected to come on stream in December 2003, while also investigating the feasibility of a gas turbine 1,800 MW power station as part of its Power Procurement Process.

Global Olivine Western Australia has proposed a $560 million waste-to-energy-and-water plant that will accept and incinerate local council waste materials to generate energy and water, which is expected to be commissioned by the beginning of 2004.

Alichem Pty Ltd has announced plans for a 40,000 tonne per annum aluminium fluoride plant

Port facilities in the area are also being upgraded. James Point Pty Ltd is proposing a new livestock handling facility to replace the use of the Fremantle port, while construction of the $200 million Jervoise Bay Industrial Marine Complex continues.

Responding to the report, Chamber of Commerce and Industry chief executive Lyndon Rowe said that, while the area was often criticised for its environmental performance, the economic benefits were often overlooked.

“I don’t think significant recognition is always given to Kwinana’s economic and social importance when its activities are challenged,” Mr Rowe said.

“Kwinana industrial area is critical to the livelihoods and well-being of big numbers of ordinary working people and to other people and business involved down the chain.”

The Perth Airshed Inventory Update 1998-99, released earlier this year by the Department of Environmental Protection, estimates that emissions of sulphur dioxide from industrial and commercial sources in the region have fallen by around 14 per cent, or 2,300 tonnes per annum, between 1992 and 1999.

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