Neerabup mining profit margin drops

The City of Wanneroo plans to outsource limestone extraction in Neerabup industrial area.
The City of Wanneroo plans to outsource limestone extraction in Neerabup industrial area.

THE City of Wanneroo has scaled down profit predictions for its Neerabup landholding as the State Government gets permits to clear more of the industrial area.

According to an April council report, the City has revised commercial assumptions for extracting limestone and sand on 127ha for future industrial development.

The council endorsed a 10-year business plan for the resource extraction in late 2017, which at the time was expected to generate “significant revenue”.

However, this month the council approved a revised plan that said works would require 15 to 20 years to complete rather than 10, and readvertised it for public consultation.

The April council report said during the previous tender process, only one tender received included positive revenue for the City, and the original plan had not considered the possibility of poor market demand and price.

It followed last month’s council decision to approve LandCorp’s plan to extract 700,000 tonnes of sand and limestone at its Neerabup landholding.

LandCorp has received a clearing permit for its Neerabup landholding.

The Department of Water and Environmental Regulation also granted LandCorp a clearing permit for 93.4ha of bush on the Neerabup site in mid-April.

As the site contains 69.2ha of endangered Carnaby’s black cockatoo foraging habitat, LandCorp has allocated a 481ha environmental offset in Mindarra in the Shire of Gingin to the project.

Permit documents said the project initially involved clearing 218ha and was reduced to 93.4ha to avoid and minimise potential environmental impacts.

The City has invited public comment on its revised business plan for a contractor to extract limestone and sand until May 23.

“The preferred tender for the major trading undertaking resource extraction contract will cost in the order of $6 million for the works associated with vegetation clearing, top soil strip, cut to fill and rehabilitation earthworks,” a council report said.

“(It) is estimated to return revenue in the order of $8 million from the sale of the extracted limestone and sand resource.”

The report said resource extraction was necessary to reduce ground levels so development could proceed in the industrial area.

It also said demand for raw materials for housing and road construction projects was expected to continue.

At the April council briefing, councillor Linda Aitken asked if, given completion was expected to be in 2034, the land where material was extracted would be developed progressively to stimulate business in the area.

The City’s advocacy and economic development manager Steve Marmion said one of the lots was as the right level for development to start and they could stage extraction and development of lot 9003.

At the meeting, Crs Russell Driver and Paul Miles said they were disappointed the development might take 15 to 20 years.

“Twenty years is a long time before the ratepayers of Wanneroo are going to see any funding out of this project,” Cr Miles said.

Acknowledging the delays, Cr Dot Newton said “maybe it was a mistake in the past to say we could provide all those jobs”.

Visit www.wanneroo.wa.gov.au to make a submission.