Transcript - ABC 891 - 4 May 2010

SUBJECTS: Olympic Dam expansion

Sonia Feldhoff: Christopher Pyne is the Liberal Federal Member for Sturt. He joins us now. Thanks for your time Christopher.

Christopher Pyne: Good afternoon Sonia. Good to be with you.

Feldhoff: Now what is your concern?

Pyne: Well my very real concern is that BHP Billiton has many options that it can choose from to spend its shareholders funds to expand its current mines. Of course it has copper mines in Chile, which are of a size comparable to Olympic Dam. And now that the Rudd Government has decided to slug mining companies, which in affect means shareholders and people with super funds have $9 billion dollars in extra tax. It's made Australia the highest taxing country in the world for mining companies. In a globalised world, there's no reason at all why BHP Billiton couldn't make the decision to mothball Olympic Damn and the expansion of it and instead put their resources into those countries that are not over taxing industry.

Feldhoff: What sort of countries are looking attractive compared to what we're offering here?

Pyne: Well we've already heard today that mining companies in Australia are looking at expanding their mines in Guinea, in South America, in Chile, in Papua New Guinea and so there are three countries that immediately come to mind that mining companies are talking about shifting their resources (to). An exploration site in Western Australia has been announced as being shelved today by the company that owns that exploration site in the North West of Western Australia. Another mining company yesterday announced that it wouldn't be going ahead with two particular projects in Queensland. And what the Rudd Government doesn't seem to understand or the State Government here that hasn't said a peep about this issue is that mining companies don't need to build in a particular country in a globalised world. They can come back to a mine in decades time if they choose to and they can invest their shareholders funds where they're going to get the maximum return.

Feldhoff: Now Christopher Pyne yesterday the State Treasurer Kevin Foley was on 891 Mornings with Matthew and David and they posed a question very much like that to Kevin Foley. This is what he had to say.

(Foley grab)

Feldhoff: Do those comments give you any more confidence Christopher Pyne?

Pyne: Not at all, the briefing Kevin Foley was talking about was over a week before the Rudd Government announced the $9 billion dollar resources rent tax. Nobody in the mining industry seriously believed that the Rudd Government could be so cavalier with the future of the Australian economy, that they would go ahead with such a huge impost to feed their addiction to spending. The Olympic Dam expansion is good for South Australia, it is vitally important. It is the most important mining project in the country, and certainly in South Australia. The State Government in South Australia should be screaming from the rooftops, in the same way Colin Barnett is in Western Australia, about protecting Olympic Dam in South Australia's interests. In exactly the same way that Mr Rann rolled over on Mr Rudd's health proposals, and got not one extra dollar for South Australia before he agreed to it they are saying nothing about the Olympic Dam resources rent tax implications because I think the Government has basically given up on South Australia.

Feldhoff: So other than shouting from the rooftops would you like to see any sort of concrete guarantee about the future of the Olympic Dam expansion?

Pyne: I don't think it's fair to demand that BHP Billiton guarantee that they will go ahead with the expansion in the teeth of a massive increase in the mining taxes in this country, what needs to happen is Mr Rann and Mr Foley need to say to this Government, this tax is a bad tax, and what are you doing to make sure it doesn't drive thousands of jobs and royalties overseas where companies can easily invest their funds? What has Mr Rann or Mr Foley done to convince themselves, that the new resources rent tax will not mean that BHP Billiton goes ahead with the expansion of a mine somewhere else? A briefing a week before the event, is hardly due diligence.

Feldhoff: Christopher Pyne thanks for your time.

ENDS