Yara Pilbara chooses families over FIFO

Yara Pilbara has announced a new recruitment drive aimed at attracting workers and their families to WA’s north-west with sweeteners that include free housing, international training and a family friendly roster.

In direct contrast to the fly-in-fly-out phenomena, Yara Pilbara is constructing 60 homes in Karratha for new employees and their families.

Chief Executive of Yara Pilbara, Mark Loquan says the practice of “living local” is better for workers as well as the company.

“We believe having our people here in Karratha, in close proximity to our plants makes sense for us. It promotes continuity in our operations, and for those of our team members with families it means they can be together and share in being part of a larger community,” Loquan said.

Yara Pilbara is the operator of one of the world’s largest ammonia production facilities located south of Karratha.

The company is also currently building an $800 million technical ammonium nitrate (TAN) plant on the neighbouring site.

The joint venture operation, run with Orica and Apache, is expected to begin producing around 330 000 tonnes of AN annually by mid 2015.

Yara will be the operator of the plant while Orica will manage sales and distribution.

Site preparation works at the plant began in November 2012.

In addition to providing housing for the plants employees, the Norwegian-owned company will be offering overseas training opportunities to some of the new hires in countries including Spain, Chile and Sweden.

Twenty-nine year old father of three, Jonathan Luck moved his family to Karratha from Western Sydney to work on Yara Pilbara’s ammonia plant about twelve months ago.

“I couldn’t do fly-in-fly-out. Working for Yara, I’m fifteen minutes from home, I’m home every night and home on the weekends. You just can’t beat the lifestyle” said Luck.

Luck signed on with Yara Pilbara after being retrenched by Shell when the company shut its Sydney refinery.

He says the closure of Shell, in addition to the slowing manufacturing sector in NSW, meant that job opportunities were drying up in Sydney, prompting him to look for work in either Queensland or Western Australia. He says moving to Karratha was the right decision.

“We’re five minutes to the beach here, whereas in Sydney we were over an hour and a half away. We used to be half an hour from Woolworths and Coles, but here we are five minutes away. We just love the lifestyle, we are so close to everything” Luck said.

Yara said Karratha is quickly becoming a destination of choice for families due to significant investment in the town’s infrastructure in recent years.

It says the Karratha Leisureplex is popular with locals for its swimming pools, gymnasium and aqua-play facilities.

While the town has also invested in new schools, childcare facilities, sporting clubs and cafe’s, and is in close proximity to a number of pristine beaches.

Jonathan’s wife Vanessa is a stay-at-home-mum to four-year-old Genevieve and two-and-a-half year old twins William and Josephine. She says they are happy in the town.

“It’s a great place for families. There is so much to do up here and it’s a brilliant place to raise kids. It has a real community spirit. Genevieve goes to dancing and swimming lessons and the twins go to aqua-tots” Luck said.

Yara is currently seeking to hire fifty people in its next wave of recruitment, to work on the TAN plant, currently under construction. The company is looking for shift superintendents and operational staff.

Some of the new recruits will visit Madrid in Spain for four weeks of theoretical training, Chile for two weeks and Sweden for two weeks of plant operational training.

“Yara is part of a global company which has developed stringent and continuously increasing safety standards over a century of experience which are applied to each location around the globe” Loquan said.

Yara Pilbara is the subsidiary of Yara International ASA, which is the world’s largest producer of ammonia and a world leader in the production of TAN. The company has had significant experience in operating TAN plants since 1965 and has an excellent track record in safety and innovation.

Yara International ASA has operations and offices in more than 50 countries and sales to more than 150 countries across the globe.

Despite Yara International ASA being well recognised overseas, Luck had never heard of Yara Pilbara before he was approached by a recruiter. He encourages others to apply for the positions on offer.

“Definitely come and have a look and you’ll be pleasantly surprised.  There’s boating, fishing, four-wheel-driving, there are so many activities and fantastic facilities. Once you get here you realise Karratha has a strong community and is a really great place to live” Luck said.

Anyone interested in finding out more information or applying for a position can visit www.yara.com


Broadmeadow Mine looking forward to a $1 billion expansion

INNOVATIVE technology, more employment and higher production is what BMA’s Broadmeadow Mine has to look forward to thanks to a $1 billion expansion.

The mine will have innovative technology to extract thick seams of coal will be used in Queensland for the first time.

Natural Resources and Mines Minister Andrew Cripps said the technology was the first of its type to be used in a Queensland mine and allowed for almost complete recovery of coal from thick seams.

“It is also renowned for its high productivity and for reducing operating costs, which are significant advantages for the coal mining industry,” he said.

“The extension of three longwall panels at the mine means production will be lifted from 400,000 tonnes per annum to a new total capacity of 4.8 million tonnes per annum.

Mr Cripps said the mine extension generated 650 jobs during construction and could also allow for an increase in production capacity.

“This expansion won’t only support the growing resources sector, but has also been a boost to the construction industry, another economic pillar of the Queensland economy,” he said.

“In the past, the construction industry hasn’t been a focus, however these sorts of construction projects provide jobs and improved infrastructure for Queensland.”

Broadmeadow is an underground mine on the Goonyella lease near Moranbah that produces hard coking coal for export to the Middle East, Asia, South America, South Africa, Europe, Japan and India.

Emerald valuer blames mine camps for residential market blow

“AS camp rooms came in, the average value of existing houses went down the shoot.”

This is the message Emerald real estate valuer Pat Lyons delivered at the CHDC business breakfast last week.

Mr Lyons used Moranbah as an example, and said the real estate market was drastically affected after the introduction of mining camps.

“The completion of a couple of new workers’ accommodations in the past few years has significantly impacted on the demand for rental and motel accommodation in a number of towns,” he said.

There is good news for Emerald residents though.

“The reason you will probably note that the house prices in Emerald have not come down as much as other places is that we don’t have a lot of camps,” Mr Lyons said.

“We haven’t seen the same downturn as compared to Moranbah which has a significant number of camp rooms.”


Mr Lyons said the impact of camps on real estate markets in the Central Highlands was evident and had been felt elsewhere.

“I’ve had a talk to some of my colleagues in Gladstone and in Gladstone exactly the same thing happened,” he said.

The hotel and motel industry in Emerald had seen the positive of a lack of mining camps during the construction of Kestrel’s mine expansion, but it has since died off.

“We don’t have a lot of temp accommodation,” Mr Lyons said.

“The motel industry in Emerald has been significantly impacted by the downturn in the mining industry.

“The rate of motel rooms in Emerald has fallen significantly since the completion of KME – it has fallen by about 30%.”

Mr Lyons said housing factors had historically been affected by increased production at mines and the cost of coal.

“House values are affected by two factors – there is increasing production and there is increasin coal prices,” he said.

Now, there are camps as well.

Investors cry foul over FIFO in Central Queensland

Property investors in Central Queensland claim they are losing hundreds of thousands of dollars as mining companies continue to favour 100 per cent FIFO workforces.

Some say the situation has become so dire, investors are planning to lobby the state government for hardship relief.

Lee de Ryk claims wholly FIFO operations had “destroyed the spirit” of Moranbah and other mining towns in Queensland, Daily Mercury reported.

He claims a recent investment in a standard Moranbah development had dropped $300,000 in value.

“We need to put a stop to FIFO,” he said.

“There are 200 to 300 people (investors) who have lost hundreds of thousands of dollars from the value of their properties.”

He says property foreclosures are becoming more common in the town as land and house values plummet.

“This week I know two people who have had to foreclose their properties.

“I know one person who bought a property valued at $910,000 and this week sold it for $199,500.”

The comments come after BMA released plans to build a new 3000-room workers camp in the area as part of plans to develop its new Red Hill mine as well as expand underground coal mines Broadmeadow and Goonyella Riverside.

The project will generate 2000 jobs in construction and an additional 1500 in operation and the miner says a flexible 100 per cent FIFO workforce is needed for the projects.

However critics say there is more than enough housing at affordable prices in the region to sustain a local workforce.

“You can’t keep building mining camps. People don’t really understand that these camps have killed the spirit of mining towns,” de Ryk said.

“FIFO workers now get on a plane or a bus and go straight to their camp and work there seven days on and fly back. They don’t even see Moranbah and they don’t spend any money in the town.”

BMA’s plan has prompted Isaac Mayor Anne Baker to urge the Queensland state government to reject the mining camp proposal.

“If the Queensland Government condones 100% forced FIFO work practices at Red Hill, they are effectively allowing BMA to cut jobs in the region and lay the foundation for regional decline,” Baker said.

A BMA spokeswoman said flexible employees need to be retained given the uncertain timing of the expansion plans.

The company’s plans are currently before Queensland’s Co-ordinator General.


Moranbah sales halve in the past year as mining slows down

IT SEEMS the mining downturn in Moranbah has dealt a strong blow to the town’s housing market.

And a former Moranbah resident, who wanted to be known as Mr Johnson, yesterday said he believed fly-in fly-out and drive-in drive-out played a major role in the downturn.

“It’s more convenient for miners (being FIFO and DIDO) and now they don’t have to live in Moranbah, so that plays a huge part,” said Mr Johnson, who now lives at Bajool.

New REIQ figures show the Moranbah housing market suffered a 49% drop in house sales in the past year.

In the December 2013 to February 2014 quarter, only six houses sold at Moranbah compared to 14 at Cannonvale and 44 in the Whitsunday region.

The median sale price at Moranbah in the past year was $380,000.

Sales in the Central Highlands were stronger in the December 2013 to February 2014 quarter but the region’s housing market suffered an 8% drop in the number of sales in the past year.

A total of 41 houses were sold in the Central Highlands in the quarter to February 2014.

The median sale price was $400,000.

Meanwhile, Banana and Biloela had positive growth in housing sales in the past year, recording a 1.9% and 0.4% increase respectively.

A total of 26 houses were sold in Banana in the quarter to February 2014 while 17 homes were sold in Biloela.

Despite the slight downturn in parts of Central Queensland, the number of house sales across Queensland peaked at the end of last year.

The state also recorded healthy price growth.

The REIQ December quarter median house price report found that the volume of house sales reached its peak of activity for the year in the last three months of 2013.

REIQ chief executive Anton Kardash said not only could the December quarter claim to be the third strongest in as many years, it was also firming without the aid of extraneous stimulus measures.

“The September quarter, or spring selling season, historically records the highest numbers of sales,” he said.

“Last year, however, the December quarter trumped it with the preliminary numbers of house sales peaking at just shy of 10,000 for that three-month period.”


Atlas to double production at Mt Webber, posts record H1 output

JOHANNESBURG (miningweekly.com) –ASX-listed Atlas Iron announced on Tuesday that it would proceed with development of the Mt Webber Stage 2 project, doubling production at the North Pilbara operation to six-million tons a year.

First export of Stage 1 product remained on track for the June quarter, with the expanded production rate of six-million tons a year expected to be achieved by the end of December.

Life-of-mine operating costs were now expected to be between A$49/t and A$51/t, representing a significant reduction from the A$56/t originally estimated for the Stage 1 project.

The “competitive” operating costs were driven by a strip ratio of 0.3:1, with the potential to reduce these costs further through rail access.

Describing Mt Webber as a “highly capital-efficient mine”, Atlas MD Ken Brinsden said in a statement that a completed feasibility study had estimated the combined cost of Stages 1 and 2 expansion at A$212-million, or $35/t.

“This is clearly well below industry norms and is inclusive of a substantial contribution towards regional road upgrades, which will benefit Pilbara road users for years to come.

“Atlas has a track record of delivering new mines in a cost-effective, timely manner and the completion of the second stage of Mt Webber will fulfil the company’s original Horizon 1 vision, with further material opportunities in the pipeline,” he commented.


Atlas’s Horizon 1 growth programme aimed to expand its North Pilbara development model to produce at a rate of 12-million tons a year by the 2014 financial year, targeting 15-million tons a year by late 2015, which would be achieved through several mine and infrastructure developments.

Atlas was now on the final leg of its Horizon 1 programme and expected to outlay some A$180-million on capital expenditure (capex) in the first half of the year, with construction of the current suite of Horizon 1 mines expected to be complete by the end of the calendar year.

“After a period of significant investment in the business, Atlas will have built its currently proposed Horizon 1 mine profile by the end of this calendar year.

“With the Horizon 1 capex nearing an end and the first-half results demonstrating the cash flow capacity of the business, Atlas now has the flexibility to consider the various capital management initiatives at its disposal,” Brinsden noted.


Atlas’ expansion announcement came as the group released its financial results for the half-year ended December 31, which reported strong profits on the back of growing production and tightened costs as the company eased its Horizon 1 programme.

A strong first-half profit of A$73.7-million reflected higher production, a tight focus on cost control and robust prices, with record production of 5.1-million tons putting Atlas on track to achieve its upgraded guidance of between 10.2-million tons and 10.7-million tons for the current financial year.

The record production, combined with a rise in the average realised iron-ore price from $98.50/t in the previous corresponding half to $115.60/t in the latest six months, generated record revenue of A$588-million.

Indicative of its “cash-generative capacity”, the company finished the half year with gross cash of A$389-million after investing A$201-million in growth activities.

“These funds were invested in expanding mine and infrastructure capacity, and in additional exploration drilling, which contributed to significant new discoveries at the North Pilbara-based Corunna Downs and Miralga Creek projects,” said Brinsden.

In the six months under review, Atlas achieved net cash from operations of A$206-million, up from a A$5-million deficit in the previous corresponding period, and underlying earnings before interest, taxes, depreciation and amortisation of A$200-million.

“These are outstanding results which reflect the significant investment we have made in growing our business while maintaining a conservative balance sheet, and returning dividends to shareholders,” commented Brinsden.

“We are now producing at over 10-million tons a year and heading towards 12-millon tons a year and have a significant resource base in the Pilbara and port entitlements, giving us attractive options for value accretive growth.”

He added that the generation of low-cost sophisticated infrastructure solutions for Atlas’ Horizon 2 assets remained a key priority for the company.

“We are encouraged by the interest being expressed by parties seeking opportunities to cofund infrastructure and mine developments in the Pilbara, and will progress these opportunities further as infrastructure solutions are crystallised,” he concluded.

The company announced a dividend of A$0.03 per ordinary share for the six months.


BHP takes full control of its iron ore mines

The trend for mining companies to manage their own mines instead of hiring external contractors has continued, with BHP Billiton confirming the last contractor working on its Pilbara iron ore mines will be relieved of its duties.

BHP said it would take full control of an iron ore mine called ”orebody 18” by June, ending nearly seven years of work on the site by mining services company Macmahon.

BHP said Macmahon’s time in charge of the site had been successful and the two companies would work together to ensure a ”smooth transition”.

BHP iron ore president Jimmy Wilson said the change was the final step in making the company’s iron ore division 100 per cent owner-operated.

The past couple of years have seen many mining companies opt to take back control of their own mines rather than use contractors.

Part of the incentive for miners is to lower costs by removing the profit margin that contractors charge, but many miners also believe they are more in control of their safety reputations when they manage their own mines. Over the past six months Fortescue has taken control of its mines in the Pilbara after being concerned about the safety record of one of its contractors.

BHP and Glencore Xstrata have also taken many of their Queensland coal mines in-house in recent years. BHP started the trend in 2011 when it bought HWE Mining, which had been operating some of its Pilbara iron ore mines.

As part of BHP’s move to control orebody 18, the company will suspend operations at the Yarrie mine, which ranks as its smallest in the Pilbara. The move is believed to be linked to productivity and optimisation measures in the Pilbara, where BHP is rapidly expanding its production and exports.

Macmahon shares fell by half a cent to 12.5¢ on Tuesday, but Macmahon chief executive Ross Carroll said his company had a long-standing and positive relationship with BHP, and was already in talks with the miner about other potential contracts in the region.

Macmahon said most of the 200 workers it employed on orebody 18 would be redeployed elsewhere.

BHP shares closed 28¢ lower at $39.10.
Read more: http://www.smh.com.au/business/bhp-takes-full-control-of-its-iron-ore-mines-20140225-33fqw.html

100% FIFO concept slammed by Moranbah investors

The concept of making Queensland’s Moranbah a 100% fly-in, fly-out town has angered investors, who argue that it isn’t a flexible option and that there is plenty of accommodation for workers to live in the town.

Moranbah, once an investor favourite town gracing hotspot lists around the country, saw capital gains soaring and high rental yields to the tune of 20% before plummeting in recent times and leaving investors the area struggling.

The area has been the subject of much debate, and has recently been labelled a hotspot again with resources spending expected to be significant.

However, within a new proposal from BMA to expand underground mines and create a new development is a 3,000-room mine camp for all of the construction and operational workforce.

Property Observer was provided with a letter sent to Deputy Premier and Minister for State Development, Infrastructure & Planning Jeff Seeney by a Real Wealth Australia client, who lost a tenant due to forced changes and who is calling out for there not to be an enforced 100% FIFO workforce.

The investor, who had attempted a FIFO lifestyle before choosing to live in Moranbah themselves to be with their family every day, wrote to Seeney that the majority of workers traditionally drive in from Mackay, Rockhampton and other areas.

“There are hard working families in the regions who are financially suffering due to the jobs that are being lost to the region via the down turn and reduced employment opportunities because of FIFO. There are families who have purchased homes that are now worth less than the purchase prices. Some of them need to leave town to secure work and they can’t rent out their places. Some people are going bankrupt, honest hard working people who have tried to build up some assets so that they can avoid dependance on government. By approving FIFO you are basically kicking these people in the guts,” the investor wrote.

In the letter, they quoted comments made by Seeney to the ABC.

“I don’t believe there are enough opportunities for people to live in Moranbah and that’s why we’ve been working with the Isaac Regional council to develop places like the Belyando estate and we’ve been prepared to invest into infrastructure,” Seeney was reported as saying.

“Since we came to power, we’ve tried to work with the council to ensure there are extra opportunities provided for people to live locally, but unfortunately we haven’t had the co-operation from the council that we would have liked.”

Irritated at these claims, the investor pointed to the following:

  1. There are currently 359 Vacant Houses in the communities of Moranbah and Dysart that are affordable and many have been vacant for months
  2. There are 100’s of approved development applications in Moranbah / Dysart for new properties which have been stalled due to the mining down turn and the FIFO policies that are being approved. Values have dropped so much that it is no longer viable to continue these developments
  3. That BMA owns a large block of land at the end of Mills Avenue, which during the 2011 mining boom remained untouched, yet BMA claimed there was a “shortage of accommodation” in the town which helped them to fuel their debate for 100% FIFO at Caval Ridge and Daunia
  4. Council wants to grow the town and have always been accommodating for developers and investors in the region. Their commitment to the Belyando Estate is hard evidence that they want to accommodate more people.

Isaac Regional Council’s Mayor Anne Baker is against the proposal for a 100% FIFO workforce in the area, saying that it threatens the wealth of all of regional Queensland.

“It is reasonable to represent our residents and stand up when we facing the long-term failure of our regional communities, and it’s bigger than that, no one in Central Queensland is safe, particularly Mackay and Rockhampton,” said Baker.

“If the Queensland government condones 100% forced FIFO work practices at Red Hill they are effectively allowing BMA to cut jobs in the region and lay the foundation for regional decline.”

Baker said that the council is “not naïve enough” to expect the full amount of employment numbers to be sourced locally, but said that a forced 100% FIFO threatens all of regional Queensland.

“As I have said before, our vital and well established mining regions must be strong, healthy communities.  Our communities need population and economic growth, small businesses need confidence and we need community sustainability,” she said.

The median price in Moranbah is currently $382,500 for a house, with a median weekly asking rent of $500, according to RP Data.

By Jennifer Duke
Monday, 24 February 2014


Potential SMSF changes bringing in penalties up to $10,200 discussed by ATO

Almost one million Australians have opted for self-managed super funds, and many more are considering the option, however there are regulatory changes coming, according to ATO Deputy Commissioner Superannuation, Alison Lendon.

Lendon said that they are looking to work with trustees and advisors to help prepare them for several regulatory changes to be rolled out over the next year, and would be providing YouTube videos for trustees at the SMSF Professionals Association of Australia (SPAA) national conference this week as a result of the sector’s growth.

“With the popularity of SMSFs continuing to grow, we want to work with trustees and their advisors to improve compliance and make sure they are prepared for several regulatory changes that will be rolled out over the next year,” she said.

Proposed legislation giving the ATO new powers to address non-compliance by SMSF trustees will be a hot button topic at the conference.

Should this legislation be introduced, administrative penalties will apply to breaches of super law from July 1 this year. This will see trustees breaching this law potentially liable for penalties from $850 to $10,200 depending on which provision has been contravened.

“SMSF trustees should rectify any contraventions as soon as possible or they may face a penalty,” said Lendon.

“In some cases these changes will impact the way SMSFs operate so for the ATO our focus will continue to be on education and support to ensure trustees understand the rules,” she said.

The most common contraventions being reported to auditors are related to:

  • Loans
  • Borrowings
  • Sole purpose breaches
  • In-houseassets
  • Arms-length and related party investments

Arms-length and related party breaches could include renting out a property in your SMSF to yourself or a friend or family member of a trustee.

Every Auditor Contravention Report will be reviewed by the ATO this year.

New data and payment standard reporting rules have also been changed.

By Jennifer Duke