FINDING a car park on Kalgoorlie’s main drag – Hannan Street – on a Saturday can be hard work. It’s a hive of activity.
FINDING a car park on Kalgoorlie’s main drag – Hannan Street – on a Saturday can be hard work. It’s a hive of activity.
And that’s true for Kalgoorlie as a whole. Most of the shops and offices in the town of 30,000 are tenanted, the local newspaper’s full of job advertisements and businesspeople can’t get any work done on the 45-minute plane trip to or from Perth because there are too many people on board to talk to.
Needless to say, it’s all happening in Kalgoorlie.
“Gangbusters” is how local MHR Matt Birney describes the situation.
It has been a remarkable turnaround from the situation just three to four years ago, when Kalgoorlie and the Goldfields economy was said to have reached the lowest point in 20 years.
But since WMC began selling nickel mines to eager miners in the Kambalda region more than a year ago, gold and nickel prices have surged, and new companies have flocked to list on the stock market, raising tens of millions of dollars in capital.
In the past three years 50 new mining and resource companies have listed on the Australian Stock Exchange. Of these, 36 listed in 2003.
Miners are mining and explorers are seeking out new greenfields exploration. Even last year’s closure of the Bulong nickel plant in November, and some restructuring at the Goldfields operations of Canadian gold giant Placer Dome Inc, was not enough to affect the local jobs market.
“A few years ago something like Bulong would have been a tremendous setback,” according to one source.
That’s not the case now, however.
With the town’s population slowly growing, housing is already starting to prove thin.
Vacancy rates in the region are trending downward and prices are rising.
In Coolgardie, where the pressure is most acutely felt, the shire council has approved a $2 million single persons’ development, and the State Government has made more land available in Kambalda to ease local pressure.
Student numbers at Kalgoorlie’s Curtin University could more than double this year, with 76 prospective students applying to study there.
And significantly, given the drastic shortage of geologists and other mining jobs in WA, applications to Kalgorlie’s West Australian School of Mines are up nearly 200 per cent.
Kalgoorlie MHR Matt Birney said the Goldfields region was entering a boom period, the likes of which the region had not seen for many years.
Mr Birney predicted the boom, set off by the WMC’s watershed at Kambalda, would last for the next two years and would be sustained if major mineral discoveries were made in the same period.
“Kambalda accounts for about 25 per cent of the Kalgoorlie economy so there [are] those obvious flow-on effects,” he said.
“But you only have to count the millions of dollars that have been raised through floats and capital raising in the last year.
“Now all of that money has to be spent and the greater majority will be spent on exploration in the Greater Goldfields region.
“It is really in a company’s best interest to spend that money as quickly as possible.
“And the fact is, when drillers are busy so is everybody else in the area.”
Kalgoorlie mining identity and Donegal Resources managing director, Ian Junk, estimated between 12 and 20 of the 2003 resource floats had interests in the Goldfields.
He said with the increase in exploration and new mines commencing production around the Coolgardie area the outlook was very positive for the next two years.
“The only thing that will impact on the resource sector is the [Australian] dollar being fairly high,” Mr Junk said.
“It can be warm for this year but if it rolls over into 2005 it could start impacting on things a little a bit.
“It impacts on your revenue.”
Ausdrill Kambalda training and safety coordinator Kevin McCloy said his company could not meet local demand from the juniors with almost all of their rigs contracted by South African gold giant Goldfields for its mammoth St Ives gold mining project.
However, he said there had been a significant increase in demand from junior miners in the past six months.
Kalgoorlie-Boulder city councillor and Heron Resources managing director, Ian Buchhorn, said the renewed vigour around Kambalda was leading Kalgoorlie and the Goldfields.
He said Heron had recently employed a new exploration manager and a new senior geologist to keep up with its own exploration program.
“We are right into it at the moment and it seems like everyone I know is in the same position. The traditional quiet time in January just seems not to have occurred this year,” Mr Buchhorn said.
However, in even more positive signs for the future, Mr Buchhorn said the renewed vigour was yet to hit its straps
“The boom in metals prices I don’t think has translated into larger companies doing grass-roots exploration,” he told WA Business News.
“But as the smaller companies start making discoveries you will see the bigger companies starting to come in.
“And when [that happens] that is when the really big dollars start getting spent.”
Kalgoorlie Chamber of Commerce and Industry CEO Ian Gallagher said businesses around town had regained their confidence.
“The tangible effects are only just beginning to flow,” he said.
“However I think people see that there is a different make-up to the mining community now and they are looking forward to, not necessarily a boom-bust cycle, but more of a stabilisation where things are going quite well now and they see that as more sustainable.”
