18/02/2009 - 22:00

Gulf between competing Exmouth interests

18/02/2009 - 22:00


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Major players face off in north-west access stoush.

I'VE watched from afar the battle going on over Exmouth Gulf, where Straits Resources wants to establish a salt operation.

It's one of those rare fights because it's not just the project proponent versus the usual collection of opposition.

Instead, Straits has come up against local business, especially Fremantle-based MG Kailis Group, which has a major prawning operation in the gulf, which is also frequented by whales.

Rather than just battling environmentalists, native title issues and local residents, Straits has found itself head to head to with a group it would normally think was like-minded.

Far from it in this case; with the two groups divided by much more than an expanse of water.

MG Kailis argues that the salt project will impact on the spawning grounds of prawns it trawls for from its Exmouth base - a site where it also runs other fishing operations covering the waters on the Pilbara coast.

MG Kailis managing director Alex Kailis describes the battle as one for the survival of his business, a second-generation seafood, pearl jewellery and marine conglomerate.

Mr Kailis has taken some heart from last year's Environmental Protection Authority recommendation against the Straits project, known as the Yannarie Solar project.

But Straits has lodged an appeal with the Office of the Appeals Convenor, which is expected to provide its advice to Environment Minister Donna Faragher in the near future.

Straits argues that the area has been set aside for salt and gypsum production since 1970 and disagrees with the negative environmental assessment of the project, which it has scaled back considerably from the original plan that ran along about 60 kilometres of the eastern shore of the gulf (see right).

Both sides have invested heavily in the legal and administrative battle that has been going on for years.

From a hard-headed economist's point of view, and assuming that the businesses can't co-exist, it's hard to spot the difference in terms of impact; Straits says it will create about 75 permanent new jobs while the incumbent, MG Kailis, employs about 100 people at the peak of its seasonal operations. Of course, coming from the angle of incumbency, history and existing investment, MG Kailis might beg to differ on that position.

Straits, of course, argues that its operations won't affect the fishery. Then again, its new business won't rely on prawns.

The challenge for the government - especially one where the fishing and mining portfolios are under the same pro-business minister, Norman Moore - is to get the right balance.

The Liberals came to power on a platform of speeding up the approvals process. You would imagine that kind of language would give Straits a fair amount of hope.

Of course what we are really talking about here is the assessment process. It's the long wait as much as the answer that is the killer for companies involved - both proponents and opponents.

Productivity call

PRODUCTIVITY is a word getting a bit of airplay of late, in part because part of Sol Trujillo's swansong as Telstra chief has been a marketing campaign dressed up as research on the subject.

Mr Trujillo was in Perth last week to address a Committee for Economic Development Australia luncheon covering this very subject.

The Telstra boss went on at length about Telstra's own productivity improvements and, naturally, suggested that its services would help other businesses improve theirs.

Telstra has even been so kind to release a paper on the issue, suggesting that many Australian business pay lip service to productivity. In fact the survey found that 79 per cent of the directors who responded considered improving productivity a high priority, but less than half measured it or had clear targets to improve it.

Mr Trujillo's message is a good one, even if I am not convinced his company has really licked the productivity issue itself. Maybe for big businesses Telstra's service is spot on, but at consumer level I still hear of examples where it struggles to deliver.

For instance, my new neighbour - who is in the IT sector - had to request to tap into my wireless internet because he didn't have access in his brand new home. It was not for want of trying on his behalf. If it was a lone example I'd leave it, but it's not.

Anyway, I use that example only as a cynical check, not to shoot the messenger.

There are significant productivity gains to be had by investing in improving staff and the tools they use. Given the current economic climate, such investment may actually be critical - and you'll be helping Australia beat the recession, too.

On the staff side, it's clear that better people are becoming available at lower prices and that pressure is also focusing existing staff on retaining their jobs. Translate that to staff working harder and you have a simple productivity gain straight away.

In terms of investment, the government is offering tax incentives for bringing capital expenditure forward. That includes IT and communications systems that may improve productivity. The bonus is that vendors now want your business and might be able to deliver it and service it within useful time frames too.


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