After losing two major mining investments due to project cancellations, South Australia remained confident it would continue to remain a favored mining destination of global miners.
Shortly after a month that it announced it is cancelling the $30-billion expansion of the Olympic Dam copper and uranium mine mega project, global mining giant BHP Billiton has asked the state government of South Australia to extend the deadline coverage of the indenture agreement the two parties signed in October 2011.
South Australian Mining minister Tom Koutsantonis said that while the recent withdrawal of India's Deepak Fertilisers and Petrochemicals Corporation Ltd (DFPCL) and BHP Billiton last week from their respective mining investments came as a disappointment, there still remain at least 20 mines approved and a strong pipeline of projects in various stages of development in South Australia.
On Wednesday, DFPCL announced it is cancelling its planned $350 million worth technical ammonium nitrate plant near Whyalla, causing the loss of almost 500 potential jobs.
The company claimed the 310 hectare project at Port Bonython will not push through due to concerns on capital expenditure, energy costs as well as the distance to Port Bonython jetty. Industry observers however believed the cancellation of the $30 billion expansion of the Olympic Dam copper and uranium mine mega project by BHP Billiton last week was the primary reason that triggered the investment withdrawal.
The Indian firm projected to churn out 300,000 tonnes a year of technical ammonium nitrate, a component widely used in the mining industry. Should had BHP Billiton pursued the Olympic Dam expansion, an estimated 88,000 tonnes a year of technical ammonium nitrate would have been easily spent up by the project.
Some 400 jobs in the construction phase and 80 full-time jobs after completion would have been created by the technical ammonium nitrate plant project.
"While the decision not to proceed with this proposed plant at Port Bonython is disappointing, we will continue to work with Deepak to explore other financially feasible options," the minister said in a statement.
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