Epic tariff problems looming early
TARIFFS on Australia’s largest natural gas pipeline – the Dampier to Bunbury system – were causing an outcry even before they had been announceded, this week 10 years ago.
Independent gas producers were complaining that the tariff structure would protect Woodside Petroleum from competition in the gas market.
Those independents included Devex, Ampolex, Apache Petroleum, BHP Petroleum and WMC, companies that were all trying to sell gas into WA.
Back in 1994 the 1,600 kilometre pipeline was owned by the Western Australian Government’s State Energy Commission of WA and was funded by a $1.2 billion loan in the early 1980s on which only interest had been paid.
Epic bought the pipeline in 1998. As history shows, tariffs brought down Epic this yearand caused considerable angst in the energy community due to demand for the pipeline to be expanded.
As the battle raged a decade ago over the pipeline tariffs WMC said it and its fellow participants in the East Spar gas field had decided to proceed with its development at a cost of $250 million.
As Perth headed towards summer, the heat on the battle for BankWest was also continuing to rise.
The still State-owned bank more than doubled its net profit for the year to September to $82.7 million.
While that news was sinking in, BankWest takeover suitor in waiting Challenge Bank made its first ever debt raising in the Eurobond market, issuing $262 million of three-year floating rate notes.
Direct reduced iron was also hitting the headlines with three entrepreneurs promoting such projects under the microscope.
Compact Steel proposed establishing a plant in Rockingham to produce hot rolled coil, Kingstream was plumping for Geraldton and Mineralogy continuing with his plans for a plant in the North West.
Of the three, WA Government members were most sceptical of Mineralogy’s plans, touted by former Sir Joh Bjelke-Petersen key supporter Clive Palmer, which had changed several times in the preceding three years.
To his credit, Mr Palmer only recently floated a renewed version of the Mineralogy plan – the only one of the three to still be in the news 10 years later.
In other iron related news, Portman Mining announced that Anshan Iron and Steel Complex, one of China’s largest steel mills, would buy the total annual production from Portman’s Koolyanobbing mines.
Anshan, which was a joint venture with Portman in the project, had previously agreed to take 1.1 million tonnes a year but opted to increase that to 1.5 million tonnes.
On the political front the Finance Minister Kim Beazley was making his Labor Party leadership aspirations known.
He announced he would be vacating his marginal seat of Swan (now held by Kim Wilkie) to seek the slightly less marginal seat of Brand and said he would not mind waiting for Prime Minister Paul Keating to retire.
Retailer and, more recently, trading hours deregulation lobbyist Gerry Harvey, fresh from sales of $556 million for the year to June in his shopping empire, was plotting his company’s move into the WA market.
Meanwhile, a coin from the wreck of the Gilt Dragon, which lies off Cape Lescenault, went for $6,100.
The Philip IV cob reales of eight came from the Colombia Mint and had not previously been recorded from the wreck.
On sporting news, Eagles fans were fearful that favourite son (and that year’s Norm Smith medallist) Dean Kemp would be flying the coup for the catwalks of Paris.
Kemp had been excused from pre-season training to get married to Karin Boucaut who had a modelling career waiting.
The pair were heading for Paris for their honeymoon.