World fer­tiliser saviour

Townsville Bulletin - - Investor - by Tony Rag­gatt tony. rag­gatt@ townsville­bul­letin. com. au

THE des­tiny of north­ern Aus­tralia, with its seem­ingly end­less sup­plies of wa­ter, is some­times seen as the food bowl of the world.

How­ever, less well known, and prob­a­bly with less dis­agree­ment, is its po­ten­tial to be the fer­tiliser saviour of the world.

The vast Ge­orgina Basin in north-west­ern Queens­land and the North­ern Ter­ri­tory, which in the dis­tant past was an in­land sea, hosts hun­dreds of thou­sands of square kilo­me­tres o f p h o s p h a t e - r i c h r o c k formed from the sed­i­ments of ocean beds laid down tens of mil­lions of years ago.

North-west Queens­land al­ready hosts Aus­tralia’s only am­mo­nium phos­phate fer­tiliser man­u­fac­tur­ing plant at Phos­phate Hill 150km south of Mount Isa. It is a $ 1 bil­lion op­er­a­tion em­ploy­ing 350 peo­ple, many of them liv­ing in Townsville.

There are a host of play­ers look­ing to du­pli­cate what the for­mer West­ern Min­ing Cor­po­ra­tion has done – make big money out of phos­phate rock – and Townsville, 1000km away, looks set to play a big role.

‘‘ It’s a very sig­nif­i­cant re­source,’’ Townsville ge­ol­o­gist and James Cook Univer­sity emer­i­tus pro­fes­sor Bob Hen­der­son said.

‘‘ As a to­tal re­source, got t o r at e ( among largest in the world).

‘‘ The down­side of it is, it’s dis­tant from the coast.’’

The Phos­phate Hill res o u r c e w a s o n l y ‘ ‘ d i s - cov­ered’’ in 1966.

In­deed ex­plo­ration for the ma­te­rial in Aus­tralia was not per­mit­ted be­fore the 1960s t o pro­tect Bri­tish in­ter­ests in the trade.

West­ern Min­ing, af­ter ini­tial rock ex­ports and plans it’s t he

PROSPECTS: Kru­cible Met­als per­son­nel Brid­gette Humphries, Mar­cus Har­ris, Tony Al­ston and Den­nis Lovell f o r c o mple­men­tary s ul - phuric acid plant and gas p i p e l i n e we r e s e c u r e d , opened the Phos­phate Hill fer­tiliser plant in 2000.

BHP Bil­li­ton, which took over West­ern Min­ing, sold off the plant for a song in 2005 – just $ 165 mil­lion.

With the price of am­mo­nium phos­phate, vi­tal for mod­ern agri­cul­ture, now well over $ 600 a tonne and climb­ing, an­nual prof­its from the op­er­a­tion which pro­duces about one mil­lion tonnes a year have been in the tens and hun­dreds of mil­lions of dol­lars.

Also, with sci­en­tists warn­ing that the world is app r o a c h i n g ‘ ‘ p e a k p h o s - phate’’ and that global re­serves could be de­pleted in as lit­tle as 50 years, it is lit­tle won­der oth­ers are look­ing to du­pli­cate Phos­phate Hill.

Min­ing en­tre­pre­neur Joe A fos­sil from the phos­phate en­rich­ment zones in the

Ge­orgina Basin of north-west Queens­land Gut­nick is one. His Le­gend In­ter­na­tional Hold­ings has ten­e­ments north of Mount I sa and i s plan­ning an $ 800 mil­lion pro­ject, in­volv­ing a sul­phuric acid plant, phos­phoric acid plant, am­mo­nium phos­phate plant a n d a l u mi n u m plant.

Fi­nan­cial ad­viser No­mura has been ap­pointed to as­sess in­ter­est for part­ners.

Townsville-based ex­plorer Kru­cibl e Met­als Lt d i s in­ves­ti­gat­ing a small but

f l u o r i d e high-grade phos­phate mine, near Phos­phate Hill, ex­port­ing rock from Townsville.

On the other side of the bor­der, two other play­ers, Mine­mak­ers Ltd and Phos­phate Aus­tralia Ltd, are look­ing at be­com­ing world s c a l e p r o d u c e r s i n b e nef i c i a t e d r o c k p hos­phate, fer­tilis­ers and phos­phate chem­i­cals.

Pro­fes­sor Hen­der­son said the Ge­orgina Basin was a strate­gic re­source where the sed­i­ment basin was widely spread and was gen­er­ally quite thin but with an in­fill of up to 3km in some places.

‘‘ The bot­tom line is we have a re­source that is ev­ery bit as good and big­ger than what is avail­able at Phos­phate Hill,’’ he said.

‘‘ The prob­lem is do­ing some­thing with it.’’

He said the Phos­phate Hill plant was ‘‘ big scale chem­i­cal en­gi­neer­ing’’.

‘‘ West­ern Min­ing in get­ting that plant to­gether and to make it work was a very in­no­va­tive thing to do,’’ he said.

‘‘ It’s not a triv­ial ex­er­cise. The pro­cess­ing of it is com­pli­cated.’’

Pro­fes­sor Hen­der­son said he had lit­tle doubt the re­sources would be de­vel­oped and that the ben­e­fits for the North would be huge.

How­ever, he be­lieved de­vel­op­ment would oc­cur in the next decade rather than the next year or so.

‘‘ I think there is go­ing to be quite a long lead-up to this thing,’’ he said.

‘‘ The trick is to pro­duce a high-value prod­uct on site like Incitec Pivot at Phos­phate Hill.

‘‘ In terms of de­vel­op­ing it, we need to be smart.

‘‘ It’s a smart de­vel­op­ment, not a BHP Bil­li­ton type de­vel­op­ment.’’

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