Employment
Western Australia’s (WA’s) mining industry achieved another record level of employment with 134,871 full-time-equivalents (FTEs) in 2023-24, reflecting strong levels of mining and construction activity in the State.
This is the seventh consecutive calendar year of growth, the last five of which have been record highs.
The rate of growth in employment, however, did slow to 5.8 per cent, down from
7.1 per cent in 2022-23.
The major contributors to onsite mining employment continued to be the iron ore (62,950 FTEs), gold (31,884 FTEs), lithium (11,386 FTEs), nickel (10,434 FTEs), and alumina and bauxite (7,021 FTEs), industries.
FTEs on mining operations was up year-on-year for most minerals with the major movers being lithium (up by more than 3,000 FTEs), gold (up by more than 1,800 FTEs), and iron ore (up by more than 1,700 FTEs).
FTEs decreased for:
Copper-lead-zinc by almost 500 FTEs as the DeGrussa project wound down and ceased production and sales (in May 2023) and the Jaguar mine was put onto care and maintenance (in September 2023).
Alumina and bauxite by almost 200 FTEs as production was curtailed from Alcoa’s Kwinana alumina refinery.
Employment on mineral exploration sites was 4,163 FTEs, the second consecutive fall from a record level of almost 4,700 FTEs in 2021-22.
Employment in the petroleum sector dropped to 8,010 people in 2023-24, its lowest level since 2011-12.
This is likely being driven by shorter-term market dynamics including weaker prices, as well as a longer-term decline in new oil and gas developments in the State.
Exploration
WA’s mineral exploration expenditure was $2.58 billion in 2023-24, an increase from 2022-23 but down on the record $2.6 billion spend in 2023.
This result reflects, in part, ongoing efforts to discover new minerals, as well as the impact of rising costs, particularly for labour, equipment and fuel, within the exploration sector.
When combined with a reduction in the number of metres drilled and exploration employment (both indicators of activity), it may well suggest that the level of exploration activity in WA has peaked during the current commodity cycle.
Gold, iron ore, and other minerals (including lithium and rare earths), plus nickel/cobalt and copper, were the main target of spending:
- Exploration expenditure for gold was $884 million, though its lowest level since 2019-20.
- Iron ore exploration expenditure increased marginally to $674 million, its highest level in more than a decade.
- Other minerals (including lithium and rare earths) exploration expenditure was at another record of $575 million driven by forecasts of global demand for electric vehicles and other battery technologies.
- The amount of exploration undertaken for these other minerals is also disproportionately higher in WA compared to the rest of Australia.
- Exploration expenditure for nickel and cobalt was $236 million, down from its
- 15-year highs in recent years likely due to challenging market conditions.
- Copper exploration expenditure was $162 million, down from its peak of more than $250 million in 2021 and 2021-22.
Spending continued to be largely focused on brownfields areas or existing deposits with these areas attracting the highest spend on record of $1.84 billion in 2023-24. In comparison, spending in greenfield locations decreased to $731 million. As a result, the share of expenditure on new deposits fell to 26 per cent.
This may well reflect that brownfields exploration is lower cost and lower risk than greenfields exploration, which means it is likely to be favoured in the current higher cost environment. There has also been recent renewed interest in exploration for commodities on mature ground which had not previously been targeted such as lithium and rare earths.
WA remained the leading destination for exploration investment in Australia. It accounted for 62 per cent of the national spend in 2023-24, which is around its long-term average.
Petroleum exploration expenditure in WA continued its recovery from some of its lowest levels in a quarter of a century to be valued at $569 million in 2023-24 – its highest level in five years.
This upswing was likely largely due to a drilling program by INPEX Corporation in the Browse Basin related to the Ichthys project, as well as campaigns in the Perth Basin.
WA’s share of national petroleum exploration expenditure was 45 per cent, up from its lowest ever level in 2022-23 but still well below its peak of 15-years ago.
This was on account of petroleum exploration expenditure in WA increasing by more than the rest of Australia due to a reduced spend in the Northern Territory.
Investment
More than $32 billion was invested in WA’s mining and petroleum industries throughout 2023-24.
This result continues the overall upwards trend in investment since mid-2019.
This result was supported by ongoing construction on major LNG projects including Woodside Energy’s Scarborough project and Shell’s Crux project, as well as major iron ore developments including Onslow (now in the production phase) and Western Range. The increase also likely reflects cost pressures with mining construction projects reporting higher capital costs in recent years.
The level of spending was, however, still only roughly two-thirds of the investment during the peak of the mining investment boom a decade ago.
WA’s share of national mining and petroleum investment increased from recent years to 62 per cent, reflecting a higher rate of growth in spending in WA compared to the rest of the country.
The share was greater than the 10-year average, but below previous highs of
60 to 70 per cent during the tail-end of the mining investment boom.
The resources sector was again the major contributor (72 per cent) to total new capital expenditure in WA, though its share remained below the peak of greater than 80 per cent during the mining investment boom.
The Department of Energy, Mines, Industry Regulation and Safety also monitors and collects information on mineral, petroleum and associated infrastructure projects in the investment pipeline, and estimates the capital costs of these projects.
Analysis of this information shows that as of September 2024 there were $50 billion in projects committed and under construction, down from the $55 billion in projects in March 2024.
This change was due to the completion of construction and start of production on several significant projects:
- Mineral Resources’ Onslow iron ore project achieved first ore on ship in May 2024.
- Liontown Resources’ Kathleen Valley lithium project produced first spodumene concentrate in July 2024 with an inaugural shipment following in September 2024.
- Pilbara Minerals’ Pilgangoora 680 lithium expansion project was officially opened in August 2024.
Some other significant projects were suspended and put onto care and maintenance, including:
- BHP announced that its West Musgrave copper-nickel project would transition to care and maintenance from July 2024 and be suspended in October 2024.
- Albemarle Corporation announced in July 2024 that it would stop construction activities on Train 3 at the Kemerton lithium hydroxide plant, after previously stopping construction activities on Train 4.
These losses were only partially offset by significant upward revisions in the capital cost of Woodside Energy’s Scarborough project as well as Mitsui & Co and Beach Energy’s Waitsia Stage 2 expansion, as well as a positive Final Investment Decision on Atlas Iron’s McPhee Creek project and Rio Tinto’s Desalination Plant to support its coastal operations.
The estimated capital cost of medium to longer-term possible and planned projects (i.e. undergoing scoping, pre-feasibility and definitive feasibility study) was $119 billion as of September 2024, down by around $800 million from March 2024.
The most notable new medium to longer-term projects announced were Legacy Iron Ore’s Mt Bevan iron ore project and Pilbara Minerals’ Pilgangoora 2000 lithium expansion project, while a new capital cost estimate was provided for Mineral Resources’ Lockyer Deep gas project.
Some medium to longer-term projects will not be proceeding including the Murchison Technology Metals project, following Technology Metals Australia’s merger with Australian Vanadium. Also, the Kunpupintil Lake potash project will not be proceeding after the project tenements were surrendered by Reward Minerals.
For an overview of how Western Australia’s major commodities performed, please see major commodities review 2023-24.
Principal resource projects
Western Australia’s mining industry consisted of 134 predominantly higher value and export-oriented mining projects in 2022-23, up from 129 in 2021-22 and the highest number since DEMIRS began tracking projects on this basis in 2014-15.
The most notable change in the mining industry during 2022-23 was the entry of two new mineral sands projects into the production phase: Strandline Resources’ Coburn project and Australian Garnet’s Lucky Bay garnet project. With these new projects, the total number of mineral sands projects increased to 10 from eight in the previous financial year.
Western Australia also had its first potash project achieve first sales from the Beyondie project in July 2022. The owner and operator of the project, however, Kalium Lakes, subsequently had Receivers and Managers appointed in August 2023.
There were 33 iron ore projects in 2022-23, one less than the 34 projects in 2021-22, a result following the suspension of both the Ridges and Mid West projects in late 2021 and the start-up (and subsequent suspension) of the Paulsens East project in September 2022.
While the number of gold projects was stable at 52, the gold industry had the greatest degree of turnover and activity.
There were six re-started gold projects in 2022-23. Four were short-term campaign mining operations – Aurrenne Group’s Parker Range, Focus Minerals’ Coolgardie, Greenstone Resources’ Burbanks, and Lukah Mining’s The Mount. Two were continuous, longer-term, operations – Northern Star Resources’ Bronzewing and Pantoro’s Norseman.
Six principal gold projects from 2021-22 were either under the threshold (i.e. they did not produce more than 2,500 ounces of gold) or did not operate in 2022-23.
Considerable merger and acquisition activity meant that several gold projects changed hands in 2022-23, including:
- Catalyst Metals acquired Superior Gold, the owner of the Plutonic project;
- Genesis Minerals acquire Dacian Gold, the owner of Mt Morgans;
- Newmont Corporation acquired Newcrest Mining, the owner of Telfer; and
- Gascoyne Resources, the owner of Dalgaranga, changed its name to Spartan Resources.
Several gold projects were suspended or entered care and maintenance during the financial year including the Dalgaranga, Halls Creek, Mt Morgans, Tampia, and Vivien project.
An additional copper-lead-zinc project was added following the start-up of Abra Mining’s Abra project. This brought the total number of copper-lead-zinc principal projects to four, however, the DeGrussa project reached the end of its life during the financial year and the Jaguar project was suspended in September 2023.
The number of nickel projects in Western Australia increased to nine this year, up from eight in 2021-22, due to the addition of BHP Nickel West’s Cliff project as a standalone project (it had previously been considered part of Mt Keith).
There was also an additional silica sand project (bringing the total to three) with Simcoa’s operations achieving more than $5 million in sales (up from less than that threshold in 2021-22) for the financial year.
The State’s mining industry also comprised hundreds of quarries and small mines in 2022-23 that largely produced the basic raw materials required for the local construction or agricultural industry. Such materials include clays, construction materials (aggregate, gravel, rock and sand), dimension stone, gypsum, limestone, limesand and spongolite. There were nine principal producers of these materials in 2022-23.
In 2022-23, there were 15 major mineral processing operations that transformed bauxite into alumina; gold doré into gold bars; nickel ore into nickel concentrate (through toll treatment) and nickel concentrate into nickel matte, nickel powder, nickel briquettes, and nickel sulphate; rutile and synthetic rutile into titanium dioxide pigment; zircon into fused zirconia; silica sand into silicon metal; and spodumene concentrate into lithium hydroxide.
This was one higher than the 14 in 2021-22 with the Kemerton lithium hydroxide plant progressing through commissioning and achieving on-specification and customer qualified product in April 2023.
Western Australia’s petroleum industry consisted of 19 projects that produced oil, gas and condensates from 49 fields in onshore and offshore areas of the State in 2022-23.
Many of these petroleum projects had associated processing plants for LNG exports and domestic gas sales.
This was down from 20 projects and 51 fields in 2021–22.
The Jingemia oil project was removed as it has been shut-in since July 2020.
The number of fields declined in 2022-23 due to the removal of Jingemia, as well as the conclusion of production from the Persephone and Wanaea fields at the North West Shelf. The Redback and Redback South fields at the Beharra Springs project also concluded.
The offshore Lambert Deep field (part of the Greater Western Flank Phase-3 project for the North West Shelf), and the Spartan field (part of Varanus Island) entered production during the financial year.
For an overview of how Western Australia’s major commodities performed, please see major commodities review 2023.