Brisbane
**check against delivery
Introduction
Good evening ladies and gentlemen.
It's a pleasure to be here at Austmine 2011, the premier event showcasing Australia’s mining technology, services and equipment sector.
And what a sector it is.
Australia is unquestionably a world leader in this field.
Increasingly, countries around the world are calling on Australian expertise to develop their own natural resources.
In recent months I have met with a number of mining ministers from around the world - they have all made clear their interest in Australia's mining technology and services.
And with a record pipeline of investment here at home there have never been more opportunities on offer.
MTSE is essential for Australia to maintain its competitiveness in the resources sector.
We compete by being smarter, deploying world’s best practice technology and mine management protocols.
Australian needs an innovative mining technology services and equipment sector or the industry will gradually become uncompetitive.
You lead the world now and I am confident you will continue to do so into the future.
Of course keeping Australia at the forefront of innovation is a challenge for industry, as is making sure that opportunities translate into contracts for services.
The need to extend the benefits of Mining Boom Mark II has been a growing concern within industry and one that the Government has taken significant steps to respond to in this year’s federal budget.
Budget 2011-12
This was a difficult budget – balancing the needs of a patchwork economy, finding the savings necessary to deliver on our promise to return to surplus by 2012-13 but also supporting the sectors that contribute so much to our economic prosperity.
As last year's ABARES-BRS economic survey showed mining technology services and equipment is one of those sectors.
That's why in this budget we have increased our support for measures to help keep this part of our resources industry strong and growing.
My colleague, the Minister for Innovation, Industry, Science and Research, Kim Carr has thrown his support behind extending some of his most successful, tried and true approaches to supporting industry and secured a boost in funding for these programs so they can be expanded to directly target the requirements of the resources sector.
Senator Carr is a great advocate for Australia’s manufacturing sector and I look forward to working with him to deliver these new measures.
Within the $34.4 million Buy Australian at Home and Abroad initiative we will establish a Resources Sector Supplier Advisory Forum and appoint a Resources Sector Supplier Envoy.
The Forum will bring together representatives from major resource companies, unions, manufacturers and resource technology services firms.
In the Envoy, industry will have a dedicated resource to champion Australian industry participation in the resources sector.
We will consult with Austmine and other key stakeholders on these appointments and together they will coordinate a number of key services.
These include new Supplier Advocates and Enterprise Connect Business advisers focussed on building competitiveness to win more contracts in the resources sector.
They will help suppliers overcome existing barriers such as established global vendor lists and the trend towards pre-assembled models to cement their place in the supply chain.
Identifying capability gaps in strategic markets and making the connections to help business secure these opportunities will form part of this work.
As some of your would know I am also Minister for Tourism and in the restaurant business they call this "spruiking".
We want to spruik Australia's manufacturers, Australia's suppliers. We want the names of our local companies up there in lights.
We've done it in rail providing access to $30 million in opportunities at the world's largest transport industry trade show – InnoTrans.
We've done it in water - $150 million in opportunities from the G'Day USA Water mission.
And now it is time to apply this proven combination of market exposure and practical advice to the resources industry.
In 2009 we increased funding to the state based Industry Capability Network (ICN) – supported by Supplier Access to Major Projects – enabling the appointment of specialists to nationally coordinate the promotion of Australian suppliers in priority sectors including in oil, gas and mining.
As you know better than I when it comes to bidding for the type of contracts currently on offer in Australia's resources industry it helps to have someone on the inside touting your virtues.
By further increasing funding for the ICN that is exactly what we will be able to do.
We will now be able to offer to place specialist ICN advisers directly on the procurement teams of around 16 of our major resource projects over the next four years.
Projects like the two coal seam gas to LNG operations in Queensland worth over $31 billion in combined capital expenditure.
And others expected to go to FID in the next 12 months such as INPEX's Icthys project in Darwin and Woodside's Browse project in Western Australia.
There is well over $150 billion in new resource developments and expansions either recently announced or approaching FID.
In a sense Australia's experience of "major projects" has almost been redefined in recent years with projects like those mentioned above and others such as Gorgon and the potential expansion of Olympic Dam, which could see it become the world's largest mine.
Having access to the right people, getting support to maximise the competitiveness of your bid and having your products, services and expertise promoted directly to the companies making these record investments is what our Buy Australian at Home and Abroad initiative is designed to do.
As I said to the petroleum sector last month, the Government does not support mandating levels of local content.
In a climate of footloose capital and increasingly fierce international competition to attract major projects the risks outweigh any potential benefits.
In my view commercial decisions, including the awarding of contracts, are best left to business – it is not the place of governments to interfere.
But governments can provide support - we can maximise the opportunities and help give business a more competitive edge in bidding – and that is exactly what we are going to do.
New opportunities
This is something that we already do with for example the provision of precompetitive data in offshore petroleum acreage and increasingly with geological surveys onshore.
Geoscience Australia's work makes us more attractive for exploration.
And of course increased exploration activity brings further opportunities for the mining services technology and equipment sector.
And not just in terms of quantity – but increasingly in terms of quality, in terms of the level of expertise and the extent of the innovation.
The number of readily accessible deposits both on and offshore is rapidly declining.
The easy pickings are dwindling and so the exploration must go deeper and into new frontiers.
This of course requires not just better technology, and smarter and more robust equipment but also even greater attention to safety and improved operational protocols.
As you would have seen from the exhibitions and displays today Australia is fortunate in this regard.
You are rising to the challenge, keeping Australia competitive and in Alan Broome you of course have a very passionate advocate!
In terms of the new frontiers I mentioned, potentially one of the most exciting is within the Woomera Prohibited Area (WPA).
Earlier this month the Government accepted a new framework for the management of the WPA as recommended by the Hawke review.
This new framework will see the opening up of this area for exploration and potential development – development worth an estimated $35 billion over the next decade.
We know this area is highly prospective. It is thought that it could be home to a deposit in the same order as the one at Olympic Dam.
Your services, your technologies, your innovations will be key to proving up these reserves and unlocking the potential in this new minerals frontier.
Skills and migration
I spoke earlier about what this year's budget delivers in terms of support for securing contracts from major resource developments.
Importantly though through the budget the Government is helping Australian industry to not just win contracts but also to deliver them.
We are doing this through two complementary packages.
We are increasing the intake for skilled migration to 125,850 places, including for the first time a specific regional allocation of 16,000 workers and the trial of enterprise migration agreements (EMAs) for large projects.
EMAs will help meet the labour requirements on projects with a capital investment exceeding $2 billion and a peak workforce of 1500.
They will streamline negotiation arrangements for access to overseas workers and guarantee faster processing times for visa applications.
These measures will also help relieve pressure in terms of the competition for local workers.
At the same time the Government is delivering a $3 billion skills and training package to up skill and train more Australians.
This includes support for apprenticeships and measures to increase workforce participation.
With enviably low levels of unemployment and comparatively high rates of pay, particularly in the resources sector, our focus needs to be on increasing productivity to maintain competitiveness.
Resource taxation and pricing carbon
This question of maintaining competitiveness brings me to the last two issues I want to briefly touch on tonight - the Government's work on reforming resource taxation and putting a price on carbon.
These are both difficult reforms and the debates around each are not dissimilar. Last year I chaired a comprehensive consultation process alongside Don Argus to provide recommendations to Government on the best way to implement a Minerals Resource Rent Tax (MRRT) and extend the existing Petroleum Resource Rent Tax (PRRT).
The Government has now accepted all recommendations in the Policy Transition Group's reports and the drafting of legislation is well underway.
We will be releasing the draft legislation for public consultation mid year prior to introducing it into the parliament later this year.
I believe we have the balance right with this package – investor confidence remains strong and at the same time revenue from the MRRT and PRRT will allow the Government to fund other measurers to support and grow the broader economy.
Carbon price
Having announced a broad framework earlier this year the Government is now also working through the detail of a mechanism to price carbon.
Consultation with a broad range of stakeholders, including in the resources and particularly the trade exposed sector is ongoing.
The Department of Climate Change has received hundreds of submissions for the Government to consider.
Both the Prime Minister and my colleague the Minister for Climate Change, Greg Combet, have signalled their intention to release further detailed information in July this year.
In my role as Minister for Energy in particular I know how important it is that we resolve this issue once and for all.
We need certainty. Without it we won't get the necessary investment in generation, in transmission and in a range of other areas needed to keep our economy strong.
But we also need to get the settings right, to maintain competition and to maintain our economic prosperity.
Conclusion
The move to a carbon-constrained world underscores the importance of innovation - the theme for this year's conference.
Finding new ways to do things, new ways to generate power, new ways to capture and store emissions, and new less energy and emissions intensive ways of mining, for example, requires us to innovate.
Australian companies are very good at this – you are very good at this - as the record shows.
Being a world leader – being the first to develop, to commercialise and to market these innovations - brings lasting rewards.
I think it is increasingly clear what needs to be done, and where the innovation needs to occur – and I believe it is you, the people in this room, who will figure out the "how".
Thank you