When the Water Corporation was established in 1996, its first chairman was a former state government minister, Peter Jones.
When the Water Corporation was established in 1996, its first chairman was a former state government minister, Peter Jones.
He was succeeded in 2003 by Tim Ungar, who had a commercial background at government-owned Telstra and Labor affiliations through the Labor Business Roundtable.
The corporation’s new chairman Patrick O’Connor has no government or political links, bringing instead diverse experience in finance, resources and management to the role.
The 43-year-old Mr O’Connor was appointed Water Corp chairman last month, adding to his other roles including chairman of mining company Perilya Ltd and executive chairman of private equity fund SG Growth Equities.
His appointment comes at a time when Western Australia, and the Water Corp in particular, is seen to be ahead of other states in terms of dealing with a drying climate.
This was illustrated by last week’s official opening of the $387 million desalination plant at Kwinana.
Other states, which have more extreme water restrictions than WA, are only now grappling with the challenge of building their own desalination plants.
Mr O’Connor sees management of the Water Corp’s capital works program – which has doubled in size to about $800 million a year – as one of its major achievements.
To cope with the increase, the corporation has increased its use of alliances with private sector companies and bundled together small projects into $50 million-plus packages to attract more private sector interest.
“That has allowed the corporation to expand its capital program and deliver it on time and fit for purpose,” Mr O’Connor said.
“The scale-up of the capital program might have overwhelmed other organisations.”
Mr O’Connor is wary of buying into political arguments, suggesting instead that Water Corp can best contribute to an informed debate on water policy by providing information.
For instance, when asked whether retail water prices in metropolitan Perth should be increased to contain demand, he points out that potable water comprises only about 17 per cent of the total water supply and is outweighed by mining, industry and agriculture.
“In a bigger, systemic sense, potable water or urban water supply is actually a smaller slice of the total water pie,” Mr O’Connor said.
“Changing urban water pricing does not change the bigger picture for water.”
He believes the community needs to debate issues such as resource allocation and water trading.
It also needs to assess whether the pricing of water should reflect the higher marginal cost of the next major supply source.
The Water Corp wants to develop the South West Yaragadee water aquifer at a cost $617 million. If that is not approved by government, the next likely option is a second desalination plant.
“I think that’s a matter for government and the community to make some longer term decisions,” Mr O’Connor said.
“I think overall the more complex discussion is the overlay of climate change and declining rainfall.
“If that trend continues, there will be more challenges as we add more people to the state and as we try to develop land in the South West and bring in more industry.”
An accountant by training, Mr O’Connor moved into the mining sector in the mid 1980s when he joined Normandy Resources Ltd.
He was a founder and managing director of Macraes Mining Ltd (now Oceana Gold Ltd), which was floated in 1989 and has established a major gold mining operation in New Zealand.
Mr O’Connor’s next move was managing director of Churchill Capital, a corporate advisory group owned by former GRD Ltd chairman Brettney Fogarty.
Last year, he left Churchill to establish SG Growth Equities, a boutique private equity fund that invests in small companies with high growth potential.
Its two main investments have been in listed companies Xceed Biotechnology Ltd (chaired by Mr O’Connor) and oil and gas explorer Adelphi Energy Ltd.
He is also chairman of major Broken Hill mining company Perilya Ltd, which has thrived on the back of soaring lead and zinc prices.
“It is interesting to see the spectrum from something like Xceed to something (like Water Corp) with a $10 billion balance sheet,” he said.
“I enjoy that because it’s challenging to be pulled in different directions.”
