Resources downturn sparks angst over infrastructure

MORE mining projects will be deferred as the nation leaves the heady days of the resources boom behind, Qantas chairman Leigh Clifford predicts.

Mr Clifford, the former chief executive of mining giant Rio Tinto, said the atmosphere of uncertainty surrounding future resources projects had developed while governments struggled to agree on key infrastructure proposals.

‘‘Projects that are committed will be completed but undoubtedly, more projects will be deferred,’’ Mr Clifford told the Association of Mining and Exploration Companies (AMEC) conference in Perth yesterday.

His comments come after iron ore miner Fortescue Metals Group announced it will cut jobs and defer $US1.6 billion ($A1.57 billion) in spending on expansion plans in response to rapidly falling iron ore prices. Mr Clifford said there was some anxiety about where deferred projects would leave the resources sector and the national economy.

‘‘From my experience, the industry has a tendency to underestimate the extent of the peaks and the troughs,’’ he said.

The current phase of transition and uncertainty in the resources industry offered an opportunity to identify national priorities.

In a high cost, low price environment there had to be a premium on efficiency, he said.

Mr Clifford added there was little consensus between levels of government and industry on infrastructure priorities.

Mr Clifford said Australia could still capitalise on the Asian century but he noted the minerals sector had lost market share in all commodities, except iron ore, over the past decade.