Mining activity in the Kimberley has a long history, commencing with the discovery of gold near Halls Creek in 1885. Construction of an iron ore mine on Cockatoo Island began in 1944, with the first shipments of iron ore made in 1951. In the 1980s, diamonds and zinc/lead deposits were discovered and mines were commissioned at Argyle (diamonds) and Cadjebut (zinc/lead). Further exploration for a variety of resources, including gold near Halls Creek, continues.
The total value of resources commodities in the Kimberley was $1.02 billion in 2010/11. The main contributors were iron ore ($430 million), diamonds and crude oil ($305 million), nickel, copper and cobalt ($222 million) and gold ($58 million).
Geographically the Shire of Derby West Kimberley produced $510 million in 2010/11 followed by the Shire of Halls Creek ($280 million), the Shire of Wyndham East Kimberley ($226 million) and the Shire of Broome ($6 million).
The Kimberley accounts for all of Western Australia’s diamond production and produces around 90% of the worlds pink diamonds. Diamonds are produced near Lake Argyle and at Ellendale in the Shire of Derby-West Kimberley. Diamonds & crude oil was valued at $306.6 million in 2009-10, that made up 37% of the mining production.
Rio Tinto’s Argyle Diamond Mine (ADM) remains a leading world producer of diamonds, producing 99.6 per cent of Australia’s lower-grade diamonds and approximately 25 per cent of the world’s diamonds by volume. Small volumes of high quality diamonds are also produced. The company’s main plant was commissioned in 1985 at a cost of $430 million, and is located south east of Kununurra near Lake Argyle.
In December 2005, Rio Tinto approved ADM’s proposed underground mine development. The US$760 million block cave underground project is expected to extend operation from 2007 to about 2020.
Kimberley Diamond Company’s Ellendale mine is another major diamond operation in the Region. The Ellendale Lamproite field is located 130km east-south-east of Derby. Mining operation commenced in mid-2002 and production is expected to increase following the expansion of the diamond production facility in Ellendale Pipe 9.
Exploration of additional diamond prospects at Blina, Beta Creek and North King George and marine diamonds to the north of Wyndham continues. It is highly likely that rapid expansion of the Kimberley’s offshore oil and gas will occur over the next few years, necessitating further infrastructure development to service the industry, at appropriate locations.
The estimated value of iron ore, nickel and cobalt in 2009-10 was $439.0. The construction of the Sally Malay nickel project, 120 kilometres north of Halls Creek, was completed in early 2004. The project consists of an open-cut and underground mining venture with the ore processed at a capacity of 750,000 tonne per annum. Bulk nickel/copper/cobalt concentrate is transported by road to the Port of Wyndham for export to China. The $50 million project is estimated to have a life of 5.5 years and employed around 150 personnel during construction, with 120 employed during operation.
Iron ore mining in the Kimberley occurs on Cockatoo Island, 140 kilometres north of Derby. The site previously produced 68 million tonnes of high-grade iron ore between 1959 and 1993 when it was operated by BHP-Billiton. All of the iron ore mined in the Region is exported. Iron ore mining on nearby Koolan Island recommenced production in late 2006.
A potential iron ore resource to the south of Kununurra is being examined and if further developed it would create a major expansion of activity at Wyndham port.
Oil and Gas
The Canning Basin is a highly prospective area for onshore petroleum and remains one of the most under-explored sedimentary basins in the world.
The Region has large reserves of petroleum and gas at offshore locations in the Browse and Bonaparte basins. Exploitable reserves of petroleum in the Browse Basin include Brecknock, Alliance (Brecknock South), Torosa (Scott Reef), Brewster and Ichthys. Known gas reserves in the Browse Basin are at 31 trillion cubic feet. There are also large reserves of petroleum and gas in the offshore Bonaparte Basin north of Wyndham at Tern, Petrel (subject to test drilling), Blacktip and Turtle. Other offshore fields included Laminaria East, Buffalo, Elang-Kakatua, Bayu-Undan, Jabiru and Challis/Cassini as well as numerous proposed fields.
The potential development of an LNG processing facility for offshore reserves is a significant potential project. More information on this project can be found at the Department of State Development.
The Port of Broome is currently being used as a supply base for offshore oil and gas exploration activities. The geographic proximity of Broome to major offshore oil and gas exploration permit areas in the Browse Basin makes it an ideal location for rig servicing and supply logistics. Continued infrastructure development at the port provides increased capability and capacity to meet the needs of an expansion of the industry.