[+] Liquid Gold: High Hopes Water Project Will Transform SA

For the driest state in the driest country in the world, water is, to put it mildy, exceedingly important. “The missing ingredient is water,” South Australian Premier Peter Malinauskas says about his State, but thanks to a significate infrastructure project, it will be used to shape the landscape with the greater hope it will transform it. As hopes that red dust will make way for greener swathes, so too do hopes for a change of another, more concrete kind. And it’s the sort that developers would be interested in. SA’s Northern Water project In 2022, one of the-then newly elected South Australian Premier’s election promises was that jobs on construction projects in the state would go to South Australian workers. Another was that everything that could be done to ensure a landmark water pipeline project went ahead, would be done. This year is the midway point in the SA Government’s timeline for the project, which is expected to be completed and operational by 2028. There are two parts to it—a 260ML seawater desalination plant using water from the Spencer Gulf, and a 600km pipeline network piping water to the state’s northern regions. The goal is straightforward enough: supply water to an undersupplied region. But its benefits will be many with the water expected to help triple copper mining production, assist with agriculture, and kickstart hydrogen and green steel projects. It is also hoped it will help decarbonise industry so that South Australia can achieve net-zero targets. And it will help reduce reliance on the Great Artesian Basin and the Murray River systems in an attempt to futureproof water supply for industry. Where possible, the pipes will be underground, and follow existing corridors, enabling revegetation of areas as well as reducing the need for additional infrastructure. ▲ A map of the intended corridor for the Northern Water project. Source: Northern Water Business Case, 2024 The pipeline will link the Eastern Eyre Peninsula, Whyalla, Port Augusta, Woomera, Carapateena, Roxby Downs, Pimba and Olympic Dam. Northern Water, the organisation overseeing the project, anticipates the need for substantial supporting infrastructure such as pumping stations, large storage facilities, control facilities and staff amenities as well as road connections and trunk infrastructure. The SA Government’s business case for the project forecast an annual $5-billion economic benefit with copper, green iron and hydrogen mining, defence and pastoral industries being the main beneficiaries. It has also estimated that 800 construction jobs and more than 4000 operational jobs will be created. That raises the question of housing and servicing provisions for this workforce. Iin February, the SA Government announced an agreement with BHP, Origin Energy, Amp Energy and Fortescue Energy and other private sector companies to co-fund the next stage of investigations into the Northern Water project. The cost of that is expected to be between $200 million to $300 million with BHP agreeing that if it withdraws from the project before a Final Investment Decision, it will cover the state’s costs to a maximum of $100 million or opt to not proceed with an water offtake agreement. The actual amount will depend on the timing of any withdrawal and what has been spent up until that point with the Final Investment Decision expected in the first half of 2026. Investigations will include project planning, design and assessment to understand the impacts and opportunities. ▲ South Australian Premier Peter Malinauskas: the state will partner with the private sector to fund further investigations into Northern Water. It will also include a formal tender process and an undertaking with a selected contractor. “BHP has created an integrated copper province that we hope will bring the scale required to economically and sustainably produce and process more copper here in South Australia and deliver it to global customers,” BHP asset president for copper South Australia Anna Wiley said in February. “The Northern Water Supply Project will support our South Australian copper operations and growth ambitions. “Global demand for copper is growing fast, and the opportunity for South Australia is significant.” BHP’s plan to create a copper province is based on a forecasted high demand for the metal as the state moves to more renewable energy, driving a surge in the need for copper cabling. “We have all the ingredients the world economy needs as it takes the necessary steps to decarbonise—copper, magnetite, a burgeoning hydrogen industry, the world’s best coincident wind and solar resource, and already world-leading renewable energy penetration,” Premier Malinauskas says. Meanwhile, Fortescue Energy is focused on the impacts on its plans for hydrogen. “Partnering with the SA Government on this desalination project lets us continue with the early scoping phase of our proposed Integrated Port Bonython Hydrogen project,” Fortescue Energy chief executive Mark Hutchinson said. BHP as developer Nowhere else is the connection between settlement development and water more clear than at Roxby Downs, 511km north of Adelaide. In 2008, BHP announced that it wanted to build 4000 homes in the town, a service centre for its mining operations at Olympic Dam. Olympic Dam is the fourth largest copper deposit in the world. It comprises underground and surface operations and operates a fully integrated processing facility from ore to metal. It is also the largest known single deposit of uranium in the world. The town at the time of the announcement had 4500 residents. Four builders, McCracken Homes, Keith Daniels Homes, Alpine Constructions and Hickinbotham Homes, submitted expressions of interest for the project. The town operates under a system of indenture with the South Australian government and BHP each providing $300,000 a year to the council for its operational costs. Of course, water is key, and that water comes from the Great Artesian Basin which is then piped to the Olympic Dam site, where BHP takes responsibility for treatment and desalination before it is sent on to Roxby Downs. That means Roxby Downs has 37.8km of potable water mains and $25 million in potable water assets. ▲ Roxby Downs in South Australia’s north could well be one of the regions to benefit most from the Northern Water plans. Northern Water could mean that BHP stops using the Great Artesian Basin and therefore will not have to provide desalination and treatment at Olympic Dam for Roxby Down’s water. The opportunities Many of the councils along the proposed pipeline are looking at infrastructure project to fulfill their specific needs. For example, the Whyalla Council’s 2023-24 Business Plan says that the Northern Water project is an opportunity, with state help, for it to concurrently upgrade existing local water infrastructure and assets to industry standard. Housing for the more than 4000 operational staff needed to work on the pipeline project is a key consideration that may mean some settlements expand or move towards infill development. While Roxby Downs does not need to expand to house the workers BHP needs, the council says, it does not rule out infill development. “The current population level to support BHP operations can be accommodated within the existing residential area,” the council documents say. “There may be a requirement in the future to provide suitable housing to assist in attracting non-BHP operations staff to the LGA. “Any expansion of the town will be funded or provided for by the developer of the expansion. This applies to infill development or new subdivisions.” Housing is on the SA Government’s mind not just due to the pipeline but for the development of agricultural, tourism, and mining and energy industries in the regions. “Without housing to support workers in critical industries such as farming, fishing, mining, manufacturing, and tourism, those regional economies fail to fire and reach their full potential,” South Australian planning minister Nick Champion said. That has led to a Regional Housing Initiatives Program, announced tis year by the South Australian Office for Regional Housing. It has allocated $10 million for regional housing projects that will deliver strategic value to the state but may need special assistance or partnering with the state government. Developers, local governments, regional employers and other stakeholders can provide submissions through a registration of interest process with proposals given an upper limit of $2 million in support from the program that closes May 3. You are currently experiencing The Urban Developer Plus (TUD+), our premium membership for property professionals. Click here to learn more.

Construction
Marisa Wikramanayake
Tue 23 Apr 24

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