3. Maximising the Pilbara’s potential for a sustainable and diversified economy

The Pilbara is one of nine regions in the state of Western Australia and a leading global mining producer, accounting for a major share of the global mining value production of iron ore. The Pilbara is situated on the traditional lands of numerous First Nations communities and includes culturally significant archaeological sites, vast mineral and energy deposits and a significant potential for renewable energy based on a climate that makes it one of Australia’s sunniest places. Besides mining, the region is a global player in liquefied natural gas (LNG) production and offshore oil (Chapter 2).

Mining has been the main engine for economic growth in the Pilbara, contributing to the largest share of exports for Western Australia and Australia. This sector also supported the recovery after the 2008 world financial crisis and mitigated the economic disruptions caused by the COVID-19 pandemic. The region presents a number of assets that make it attractive for mining ventures focused on other minerals for which new markets are emerging and can be mobilised to increase the impact of the sector in regional development. These include, amongst others, a strategic geographic location close to Asia with a solid export-oriented infrastructure, relatively lower cost of mineral extraction and an efficient regulatory and business environment with internationally competitive METS and mining firms.

However, the Pilbara faces challenges to attain a more diversified and resilient economy and increase regional attractiveness for people and businesses beyond the extractive sector. The remoteness of the region and the harsh weather, coupled with high dependency on extractive industries, have fed a regional development model characterised by economic volatility, high levels of FIFO workers, insufficient levels of engagement with local First Nations communities and businesses, low integration of local communities in the mining value chain, and relative few small and medium-sized enterprises (SMEs) and entrepreneurs.

The region has scope to leverage its mining and associated industries and its environmental assets and the First Nations’ cultural heritage to become a strategic leader in supporting the global energy transition and creating diversified and thriving communities. The region’s weather, geographical extension and energy know-how position the Pilbara with opportunities to deploy renewable energy projects and circular mining practices at scale. The deployment of renewable energy and hydrogen projects can be a means to create new partnerships with First Nations communities and new development opportunities locally while reducing the energy cost for downstream initiatives and placing the region as a strategic partner in the net zero transition of Asia. At the same time, the Pilbara’s social and natural capital, with a multicultural population and pristine environmental amenities, can open further opportunities beyond extractive industries, including tourism and logistics.

Unlocking these multiple opportunities requires a long-term and coherent vision from the federal and state governments on the future of the Pilbara, with place-based strategies that build local capacity, networks and local coalitions among regional stakeholders with sustained funding and an ecosystem that focuses on supporting diversification inside and outside the mining value chain. The growing global requirement to reduce the environmental impact of mining operations can be harnessed in the Pilbara to enhance collaboration with mining companies and First Nations communities in an effort to accelerate investments and partnerships in clean energy technologies and circular practices. The resources industry in part addresses these challenges by offering its employees a FIFO alternative to residing in the region, which has also led to negative externalities in local communities, including cost of living and social cohesion.

This chapter identifies policy recommendations to help realise the potential of the Pilbara’s mining ecosystem to unlock new growth opportunities that benefit the different and diverse communities in the region. The chapter begins with an overview of the Pilbara’s mining environment. It then analyses the regional strengths that can be mobilised to meet a diversified and inclusive economy. Finally, it examines the governance strategies that are required to ensure long-lasting development outcomes in the region.

The Pilbara’s minerals and extractive sector is a worldwide powerhouse. It is home to an abundance of iron ore, offshore petroleum (primarily natural gas), lithium, gold, copper, nickel and uranium. Its national and global mining relevance spans across different dimensions (see chapter 2):

  • The Pilbara produces approximately 93% of Australia’s iron ore production and 28% of global production.

  • The Pilbara accounts for 31.5% of the share of total export revenue in Western Australia and 11.5% in the country.

  • The Pilbara’s mining sector employs about 21% and 10,7% of the mining employees in Western Australia and in the country, respectively. This sector employs more than half of people working in the Pilbara.

  • The Pilbara generates 91% of the royalties received by Western Australia (2021-22), representing around one-quarter of total Western Australian fiscal revenue (WA Government, 2022[1]).

  • The mining sector accounts for more than 86% of total output in the region (Chapter 2)

The Pilbara also has relevant activity in oil and gas production, providing 85% of Australia’s crude oil and 70% of Australia’s LNG, which is mostly supplied to Asia. In fact, Australia is the second-largest exporter of LNG, behind Qatar. However, iron ore is by far the single activity that provides the greatest wealth for the region (AUD 134 billion of output in 2021), 2.6 times higher than the oil and gas industry’s output (WA Government, 2022[1]).

Since the establishment of the first iron mine in 1965, the region has been known as a global powerhouse of iron ore. The Pilbara’s minerals history began with small-scale exploitations, mainly gold, at the end of the 19th century, when the first European settlements occurred, occupying a territory that historically was exclusively inhabited by Aboriginal populations. Yet, it was following the discovery of vast iron ore resources and the removal of the national government restrictions on the export of iron ore in the 1960s that the region initiated rapid growth of mineral production, fuelled by an increasing demand from Asian economies, particularly in the context of the post-Second World War expansion of the Japanese and Korean economies. As a result of this boom, ten new towns were created by 1970 (two of them have already closed) and the population increased tenfold.

In the early 2000s, the Pilbara experienced a boom in iron ore production, mainly driven by the demand from China’s growing economy. In the first decade of the 2000s, the region opened 17 mines (more than 1.5 mines per year). Currently, the region has at least 60 principal mining projects (export-oriented and high value projects with mineral sales valued at more than AUD 5 million), which represents half of all principal mining projects in the state (WA Government, 2022[1]). All of the projects are export-oriented, with the People’s Republic of China (hereafter China) as the main destination. This country accounts for three-quarters of iron ore shipments. Other major markets continue to be Japan and Korea. Today, the region leads a country globally renowned for supplying a range of mineral and hydrocarbon products. Australia (particularly Western Australia) already produces about half the world’s lithium and is a globally significant producer of bauxite, gold, lead, rare earths, uranium, zinc, nickel, silver, cobalt, copper, tin, ilmenite, zircon and rutile.

The Pilbara’s iron ore production is highly concentrated in two companies, BHP Billiton Limited and Rio Tinto, which account for more than 70% of the region’s iron ore production volumes (together with various joint venture partners). Rio Tinto is the largest iron ore producer in the Pilbara and the second-largest iron ore producer in the world. With an integrated network of 17 mining sites in the region, this company exports iron ore out of two locations: Cape Lambert and Dampier. BHP Billiton operates seven mining sites across the Pilbara and exports exclusively from Port Hedland. The region’s third-largest iron production company is Fortescue Metals Group, which exports ore through Herb Elliott Port at Port Hedland.

Beyond iron ore, the region has one of the most important productions of lithium in the world, along with significant production of gold, copper, manganese and nickel (Table 3.1).

  • Gold: Gold is the second largest mineral production in the region, after iron ore, and is primarily produced by Newcrest’s Telfer mine in the East Pilbara, one of Australia’s largest gold mines. Gold exported from the Pilbara predominantly goes to China, India and the United Kingdom.

  • Lithium: The Pilbara is home to the second- and third-largest lithium-producing mines in Australia: Pilgangoora, 120 km south of Port Hedland (split into 2 resources, Altura Mining Ltd, with approximately 586 kilotonnes of lithium content [kt Li] and Pilbara Mining Ltd, with approximately 204 kt Li) and Wodgina, 110 km south of Port Hedland (approximately 240 kt Li). Given that Australia is the largest lithium producer in the world, these mines represent some of the most important lithium sources in the world. In fact, about 95% of Australia’s lithium resources are found within just 5 deposits and all are in Western Australia (Champion, 2019[2]),1 with the world’s largest producing lithium deposit (in the form of spodumene) in the southwest region of the state in the Yilgarn Craton (Greenbushes Lithium Operations with 1 320 kt Li).

  • Manganese: The Pilbara has the only two principal mining projects of manganese in Western Australia: Woodie Woodie in the Shire of East Pilbara, the second major producer in the country, and new project Butcherbird that achieved its first shipment in July 2021 (Summerfield, 2021[3]).

  • Copper: The region is also an important national player in the production of copper and nickel. The Birla Nifty Copper Operation, located 350 km east of Port Hedland, is Western Australia’s second-largest copper mine. The concentrate product is exported to India. The expected growth of energy demand for minerals will increase the attractiveness of mining the Pilbara’s copper deposits.

  • Salt fields: The region also has considerable coastal salt fields, with large ventures operating out of Dampier, Onslow and Port Hedland.

Table 3.2 depicts the main mines in operation in the Pilbara, which are classified as Western Australia’s principal resource projects, are export-oriented and of high value, with individual mineral sales valued at more than AUD 5 million (or more than 2 500 ounces of gold).

Western Australia also benefits from a business-friendly regulatory environment, which is seen as predictable and stable compared to other mining jurisdictions. Western Australia ranks as the most attractive jurisdiction for investment in mining in the world according to the 2021 Fraser Institute Investment Attractiveness Index applied to 83 jurisdictions. This index represents the opinion of executives and managers around the world in companies involved in mining exploration, development and other related activities in the sector (290 responses in 2021) (Yunis and Aliakbari, 2022[4]). The regional attractiveness has had a steady improvement over the years. The Fraser Institute mining investment attractiveness ranking went from 11th (of 77) in 2020 to 4th (of 84) in 2021 and 1st place in 2022. The factors explaining Western Australia’s mining investment are the quality of the geological database, security, political stability, and low trade barriers.

The region also stands out with its transparent permitting process. According to the Fraser Institute 2022 survey, about half of respondents stated that the time expected to obtain a permit for exploration in Western Australia is less than 2 months, which is the top 3 best performance of the 20 jurisdictions analysed (regions in Canada, the United States and Scandinavia) (Yunis and Aliakbari, 2022[4]). Moreover, it was the second-best performing jurisdiction in terms of the level of transparency and in meeting established timelines (62% of respondents indicated that the permitting authority met its own established timelines between 80% and 100% of the time) (Yunis and Aliakbari, 2022[4]).

This positive international perception is in line with the state government initiatives to reduce uncertainty for investors and approval times to obtain permits and notices to either conduct exploration activities or start the construction process (Box 3.1).

The Pilbara is an extensive and remote region, covering twice the size of the state of Victoria and similar to countries like Spain. Moving among the four main cities of the region, Karratha, Newman, Port Hedland and Tom Price, can take more than five hours on average. Such dispersity creates challenges to attain economies of scale for innovation, moving freight and people, matching labour supply and demand or providing public services (Chapter 4).

The privately owned infrastructure, coupled with cost-competitive ore extraction and its strategic proximity to major markets, has helped alleviate impacts during decreasing iron ore international prices and placed this mineral as a continuous source of growth for the region. For example, back in 2015, when iron ore prices fell almost by half, many small iron ore producers, as well as domestic African, Chinese and South American producers, withdrew or reduced their iron ore supply due to their relatively higher operating costs, resulting in increased global market shares for major Pilbara-based iron ore producers.

Mining also requires certain essential infrastructure if it is to develop its full potential: this includes roads, railroads, airports and ports for the inward flow of raw materials and personnel, as well as for the industry’s outward flow of products. A reliable energy supply, both in the form of generation and transmission capabilities, is a key element to power mining operations and processing plants. Likewise, communication and information technology (IT) networks, particularly high-speed broadband, are increasingly needed for mining, allowing remote operations and automation transition.

The Pilbara benefits from a strong transport infrastructure, whose development has been mainly driven by mineral and hydrocarbon production. Mining companies have invested for a long time in infrastructure that facilitates the construction of the mines and exports of the products. In fact, mining companies have privately funded many ports and routes, allowing companies to tailor the export infrastructure to their planned needs. The infrastructure governance framework in Australia has facilitated infrastructure development by private companies. The main features of the infrastructure in the region include:

  • Five main public airports located at Karratha, Newman, Onslow, Paraburdoo, and Port Hedland. As a result of FIFO traffic associated with construction activity in the mining sector, passenger traffic has increased significantly over the past five years at all airports, especially Karratha, which has become Western Australia’s second-largest airport for passenger movements (over 850 000 passengers passing through each year). These public airports are complemented by a large number of private aerodromes and airstrips servicing more remote mining and pastoral operations.

  • Numerous marine facilities and offshore petroleum terminals support three major international-calibre ports at Cape Lambert, Dampier and Port Hedland. In fact, Port Hedland is Australia’s largest port by annual throughput and the largest bulk export port in the world, with iron ore, mainly mined by BHP Billiton and Fortescue Metals Group (FMG), dominating the exported goods and fuel and oils, representing the main imports of this port.

  • The rail network is privately owned and transports the bulk of iron ore production. It comprises approximately 1 525 km of rail on the 4 main lines of Fortescue railway (FMG), Goldsworthy railway (BHP), Hamersley and Robe River railway (Rio Tinto) and Mount Newman railway (BHP).

  • Roads transport some mining outputs and almost all mining inputs. While some iron ore and all other minerals production are transported by road instead of rail, roads are used to move smaller volumes of mineral products and provide a key transport mode for people and other industries such as agriculture.

Nevertheless, some challenges exist in making the most of the infrastructure for diversified regional development, especially in the midst of the green transition.

  • First, much of the privately owned infrastructure that serves the mining and hydrocarbon sector is largely at capacity and prevents use by new operations and other economic sectors. The need for multipurpose regional infrastructure is more evident in the rail network.

  • Second, as projected with the green transition, a decreasing trade of hydrocarbons in the coming decades might hamper the economics of some existing ports, which requires adapting strategies to other non-mining industries. Exports of hydrocarbon-based industries still represent an important share of cargo in these ports. Planning for future needs in cargo requires long-term thinking and a degree of investment risk to offer solutions to new industries.

  • Finally, the road network is old and there is a lack of transport infrastructure corridors to facilitate and shorten travel times between the region’s cities. As roads are less of a focus of investment by mining companies, significant sections of the road network are to be maintained and not all roads are sealed, with many gravel and dirt roads.

To address these issues, the state government and the PDC should:

  • Improve co-ordination in the use of the Pilbara’s infrastructure to allow multiple uses, for example in railways, that it may also benefit non-mining economic sectors. This strategy can be inspired by spaced-based sharing models with a degree of priority to infrastructure owners.

  • Collaborate with port owners to create long-term strategies to replace cargo from hydrocarbon-based industries.

  • Use the opportunities to enhance active business partnerships with local First Nations communities and business owners and co-operate with those partners and other companies to upgrade tertiary roads and non-mining transport infrastructure through, for example: benefit-sharing agreements in projects linked to further expansion of the resource industry in the East Pilbara; the use of public-private investment models or business crowd-funding models that include spreading the cost of equipment over several organisations to maximise its productivity.

Western Australian-based METS companies are held in high regard internationally for being technology-leading and able to operate in the world’s harshest and remote conditions. Australian mining and METS companies compete in a contested international market, where innovation and technological improvements play an important role in remaining globally competitive. Overall, about 66% of METS businesses in Australia are located in New South Wales, Queensland and Western Australia.

Western Australia’s METS sector serves many of the most important resource projects in the world and is also a global resources technology base for the Asian and Indian Ocean regions. Out of the 100 top METS companies globally, 77 operate in Western Australia and 22 are headquartered in the state (Mining Journal Intelligence, 2021[6]). While many of the mining companies operating in the Pilbara also have activities in mining technology and services (BHP and Rio Tinto), there are about 1 702 specialised METS companies in the state. A number of the international METS companies servicing the mining sector through their Western Australian operations include ABB, Atlas Copco, General Electric, Hitachi, Komatsu, METSO, Outotec, Sandvik and Thyssen Krupp. These companies span across various activities, including mining support services, chemical manufacturing, telecommunication services, computer systems design, equipment manufacturing and transportation services.

Most of these METS serve operations in the Pilbara but tend to be located outside the region, either in Perth or other states. According to Austimine’s WA METS Digital Mining Export Hub project, about 268 METS are doing business in the Pilbara, based on the Industry Capability Network WA and vendor registration (Austmine, 2022[7]). Out of those companies, only 45 – less than 17% – were companies with a primary business location or headquarters based in the Pilbara, mainly in Karratha (23 businesses recorded). The rest were located either in Perth (35%) or the Northern Territory (38%); 13% of the METS companies headquartered in the Pilbara were owned by First Nations people.

As in other OECD remote and low-density populated mining regions, the Pilbara region faces entrenched challenges to attain economies of scale in labour supply and technological investment to support local METS development. The challenges of low economies of scale are coupled with other particular challenges of the region, including the competition with high levels of FIFO workers and high operational costs. Nevertheless, some opportunities can be capitalised to better integrate local businesses in mining operations and scale them up (Table 3.3).

Some initiatives have promoted local business training and participation in mining value chains (Table 3.4).

The Pilbara’s economy has a low share of forward linkages in the mining value chain (see Chapter 3). Most current manufacturing capacity in the Pilbara region is directed towards servicing the mining industry and is dominated by chemical manufacturing, machinery and equipment manufacturing, and fabricated metal products. Basic chemical manufacturing represents close to half of the Pilbara’s manufacturing output, including the Yara Pilbara Nitrates technical ammonium nitrate production facility in the city of Karratha.

Iron ore is exported with little value-added: it is crushed, screened, and blended before being directly exported on bulk carriers from the region. As mentioned above, it is used as a key input to the East Asian, mainly Chinese, steel manufacturing industry.

The region’s remoteness from markets and high-cost structure (energy, labour, chemicals, logistics, etc.) have served as significant detractors from investment in downstream and manufacturing capacity in the Pilbara.

The increasing investment in renewable energy infrastructure could improve the conditions for manufacturing in the region (see next section), not only from a cost perspective but also with respect to the lifecycle assessment of the carbon emissions of manufactured products. Renewable energy (solar and hydrogen) has the potential to reduce energy costs in the region. At the same time, this is an opportunity to unlock First Nations and industrial businesses to support the deployment of the new energy infrastructure. Regardless, the Pilbara will still face significant cost issues with respect to manufacturing.

The Pilbara is a global powerhouse of minerals supply, with great strength in exploration and extraction phases. Yet, other elements of the mining value chain are less present in the region, including processing and transformation and local equipment, technology and service providers. A significant number of companies operate in the Pilbara but many have their main operations and headquarters located in Perth, the capital of Western Australia. This is also the case for METS multinational companies operating in the region.

The Pilbara has a number of assets that make it one of the most attractive jurisdictions for mining investment. These include its geology, the opportunity to partner actively and fairly with local First Nations communities, which would work to facilitate uncontested access to large uninhabited land areas, its geographic location close to Asia, good infrastructure (ports and airports) along with a competitive, regulatory environment that is less likely to be overturned through active, local First Nations participation in regional development economy and internationally competitive mining companies.

Nevertheless, as explored later in this chapter, the mining business ecosystem needs greater integration of operations and synergies with the local First Nations and non-First Nations communities, supporting opportunities inside but also beyond mining. Moving beyond an economy highly dependent on an extractive sector with low value-added can help outline diversification strategies to better prepare the Pilbara’s mining ecosystem for the green and digital transition and unlock new growth opportunities for sustainable and inclusive development.

The mineral resource sector has brought income and development to the region and, as in many OECD mining regions, the wealth produced by this sector has translated into important investment rates, infrastructure development and high income for some regional dwellers (McMahon and Moreira, 2014[8]).

Nevertheless, the Pilbara’s high reliance on mining activities, along with its remoteness and harsh climate, have shaped a regional development model characterised by high volatility due to the FIFO culture generating a number of challenges to the well-being of the region, such as negative impacts on social cohesion and a shortage of affordable housing, childcare and quality education. This model at scale provides few incentives for economic diversification in the region, placing the Pilbara among the least diversified mining regions across OECD (Chapter 2).

The long-term sustainability of both the mining sector and the region itself relies on transitioning to a well-functioning regional environment that creates opportunities for people and families to work and live. A combination of strategies to promote economic diversification and increase accessibility to quality public services and infrastructure (e.g. housing) is a cornerstone to attain sustained and resilient growth in the Pilbara. One that goes beyond the life of mining itself.

At the same time, the international climate and sustainability goals have increased the political and social pressure for a more sustainable use of resources and reduction of environmental impacts of economic growth. The Pilbara can benefit from this increasing demand for sustainable practices to accelerate the decarbonisation of its mining sector while facilitating First Nations participation and opening local business opportunities around renewable energy technologies and circular economy practices. These processes can help improve social licence to operate in the region and improve social cohesion by involving First Nations and non-First Nations communities in environmentally sustainable activities across the mining value chain.

This section focuses on policy strategies to unlock new growth opportunities, while the next chapter will discuss policy recommendations linked to greater liveability. A vast development literature agrees that economic diversification cannot be imposed from the top down or conducted without consideration of local assets. Therefore, any policy strategy to support the Pilbara’s diversification should be anchored on existing strengths and opportunities, including its resource sector. Based on the literature review and virtual and onsite interviews with various stakeholders, this study identifies four main areas to unlock the Pilbara’s new growth opportunities:

  • Diversifying the supply of minerals to meet the global demand from the green transition.

  • Benefitting from the deployment of renewable energy sources to create a new partnership with First Nations by integrating them as active participants and owners of renewable energy assets.

  • Promoting circular mining practices to reduce environmental impacts and unlock new business.

  • Unlocking business opportunities based on its cultural, traditional and environmental amenities.

The Pilbara is more than iron ore and LNG, offering deposits of new minerals that can meet the increasing demand from green energy technologies. Mobilising new minerals will help diversify supply chains beyond iron ore and fossil fuels, and attract new types of companies into the Pilbara.

The Pilbara’s geological framework consists of a stable craton with world-class mineral deposits, including gold, iron, nickel and heavy mineral sands. The Pilbara Craton is a coherent geological area of 300 km by 500 km and one of Australia’s 3 main areas of oldest rocks, along with the Yilgarn Craton in the south of Western Australia and the Gawler Craton of South Australia (Phillips and Matchan, 2007[9]). Much of the Pilbara Craton consists of exposed rocks. The depth of weathering is quite variable, being many tens of metres in places and negligible in other places where there are fresh rocks at the surface.

The Pilbara Craton is renowned for several of its geological features and still has unexploited resources and minerals that have been identified globally as critical because of their relevance for the construction of renewable energy technologies present in the region (Figure 3.1).2 Many of these minerals include lithium, manganese or nickel, which are the backbone for green energy technologies (batteries or solar panels). To achieve the net zero scenario with a global temperature below 1.5 degrees in 2050, the global demand of these minerals would need to increase at least by 4 times by 2030 (IEA, 2023[10]). These minerals are also basic inputs for other essential industries in our lives. For instance, lithium is also used in medical implant batteries, and platinum is used in pacemakers, medical apparatus and titanium for artificial joints, prosthetic limbs and surgical equipment.

The Australian government has recognized the strategic importance of enhancing the internal supply and processing of critical minerals through incentives for attracting investments and improving local businesses and skills, which can benefit the Pilbara (Box 3.2). The Australia’s Critical Minerals Strategy 2023–2030 aims to enhance autonomy of critical minerals with initiatives to de-risk strategically important critical minerals projects, attract private investment and better engaging First Nations people in these projects and promoting the country as a ESG benchmark, among others (Australian Government Department of Industry, Science and Resources, 2023[11]). This strategy has identified 26 resource commodities to be critical minerals.

In line with this plan, the federal government has committed specific funding to help establish midstream critical mineral projects in Western Australia, including the Lynas Mount Weld/Kalgoorlie project or the Northern Australia Infrastructure Facility loan to Hastings Technology Metals’ rare earths project in the Pilbara, which can make Western Australia one of the few jurisdictions outside of China offering export quantities of processed rare earths.

On top of this, the Australian Government is reforming the national environmental law to better protect, restore and manage the environment (Australian Government Department of Climate Change, Energy, the Environment and water, 2023[12]). This includes dedicated funds to support the establishment of the new Environment Protection Australia, establishment of Environment Information Australia and legislating the commitments set out in the Nature Positive Plan. All these reforms will accelerate the green transition in the mining sector.

In parallel, Western Australia’s government has issued plans to align with the national goals on critical minerals, including the state’s 2020-22 Future Battery and Critical Minerals Industries Strategy and the Global Battery and Critical Minerals Hub plan. The state has also implemented a ministerial task force with private companies. These measures have helped land a number of projects in Western Australia in midstream mineral processing activities, including small volumes of battery-grade lithium hydroxide (which is set to expand) and battery-grade nickel sulphate only, as well as some prospective projects on the production of battery-grade vanadium, graphite, high purity alumina and precursor cathode active materials (WA Government, 2022[13]).

The region also counts on strategic industrial areas (SIAs) as a planning instrument that favours industrial development by setting aside areas of land in strategic locations to attract investment in industrial activity associated with Western Australia’s main upstream primary industries. The Pilbara has 4 of the 12 SIAs across Western Australia (Anketell, Ashburton North, Boodarie and Maitland)

Once the Pilbara is recognised as an inclusive, collaborative economic centre, it can capitalise on its many assets to become a standout leader in critical mineral strategy, including its geological potential for example, with important lithium, manganese or copper deposits (Figure 3.1). This is coupled with mining companies that can be both investors and consumers of downstream products from critical mineral, positioning the Pilbara strongly in the critical mineral industry.

One of the Pilbara’s assets in critical minerals is lithium deposits. Beyond the two existing producer mining sites (Pilgangoora and Wodgina), companies have recently announced the discovery of lithium resources. For example, Global Lithium Resources announced in 2020 a deposit of 10 million tonnes 100 km east of Pilgangoora and the Tambourah Lithium Project in the southeast of Port Hedland houses a number of companies that have announced promising results of high-quality lithium (Birney, 2022[14]).

Despite this significant resource, the current manufacture of battery-grade lithium chemicals in Western Australia is mainly located in Kwinana (Perth), which hosts one operational refinery and one refinery under construction, and Kemerton (near Bunbury in the South West region), where a refinery is under construction. The primary growth in lithium demand has been driven by the use of lithium in rechargeable batteries for electronic devices, storage of renewable and other energies and, most importantly, electric vehicles. Other uses for lithium include the production of ceramics and glasses, including heat-resistant glass and ceramics, such as those used in oven wear and cooking, and as an alloy. However, the rapid growth in demand, particularly for electric vehicles, has resulted in batteries becoming its main application.

Manganese ore is another asset related to critical minerals in the Pilbara. Most of the manganese consumed annually goes into steel as an alloying agent, followed by consumption in the production of rechargeable electric vehicle batteries (in the form of electrolytic manganese dioxide and electrolytic manganese metal). Manganese is also an important alloying element with aluminium and copper, being used in plant fertilisers and animal feeds and as a colourant in glass and ceramics. Australia has ranked since 2019 among the fourth largest producers of this mineral, with the Pilbara being home to Australia’s second major mine of manganese (Woodie Woodie) (Summerfield, 2021[3]). By 2019, the Pilbara was also home to the greatest number of manganese deposits in the country, although mostly subeconomic resources (geologically demonstrated but that are not economically viable at the time of determination) (Summerfield, 2021[3]).

The region also has downstream projects in critical materials, in which the rare earth beneficiation investment project in Onslow can be of strategic relevance for the region. While the rare earth market is currently dominated by China (60% of rare earth mining) from the upstream to the downstream end of the value chain, Western Australia already accounts for around 11% of rare earths mining production in the world, mainly produced by the Lynas Corporation Mount Weld operation in the Goldfields region of Western Australia (Huleatt, 2019[15]). This market is experiencing a growing interest, with new projects and the expectation of rare earth mineral production in Western Australia, to which the Pilbara could contribute. For example, a Pilbara Onslow Plant pipeline project – still in the definition process – aims to produce mixed rare earth carbonate – extracted from the Yangibana site in the Shire of Upper Gascoyne – and to benefit from the Pilbara’s export port facilities, proving that downstream processing is economically attractive in the region (Hastings Technology Metals, 2022[16]).

The Pilbara has an important role in this strategy, given its export-oriented infrastructure and relevant deposits of some of these critical minerals. Ensuring that the Pilbara moves beyond the simple extraction of critical minerals and gets involved in higher-value-added activities of these minerals’ value chain should be seen as a federal and state government priority to ensure self-sufficiency in these minerals and unlock further downstream opportunities for the region. To seize this opportunity and attract stability, for long-term investments that honour ESG considerations in the extraction and processing of critical minerals, the federal and state governments should work with local First Nations communities and business leaders to co-develop a meaningful First Nations economic participation framework that facilitates capacity and skills development, partnerships and access to capital.

Simultaneously, the state government should further clarify the geological potential of the region’s rare earths minerals by improving the mapping of new minerals and communications around the potential value chains. Attracting new industrial companies interested in processing these minerals in the region should include working with local First Nations communities and corporations in an effort to ease land acquisition for industrial objectives and improve connections with universities.

As the next section will depict, attractiveness to developing world-class local partnerships and bringing transformation activities in the region relies on the deployment of renewable energy infrastructure to reduce the cost of energy and transport as well as on a stronger labour market that supplies a qualified labour force.

The historic iron ore production in the Pilbara required visionary policy, international investment and co-operation. Leveraging the endowment of critical minerals in a progressive, modern-day manner can fortify ongoing political commitment and investment attraction by ensuring the meaningful participation of First Nations and communities in new mineral developments.

As the driest inhabited continent on the planet, Australia is highly vulnerable to long-term climate change and associated extreme events. Despite ongoing reduction, Australia’s per capita GHG emissions remain among the highest in the OECD (OECD, 2021[17]). This is also true for Western Australia and the Pilbara, which rank as the OECD regions with the highest emissions per capita (Chapter 2). These aspects not only undermine the federal and Western Australian government commitment to achieving net zero carbon emissions by 2050 but also future opportunities to reach markets and companies that prioritise low-carbon supply chains (e.g. in European countries).

To this end, the federal government has recently stressed the development of clean energy technologies as the path to lower emissions, with strong institutions in place to support these aims, including the Australian Renewable Energy Agency that provides grants for research, deployment and early-stage commercialisation of renewables technology, the Clean Energy Finance Corporation that facilitates the financing of clean energy projects or institutions like the Clean Energy Regulator and the Australian Carbon Credit Unit market. Likewise, the Government of Western Australia issued the Energy Transformation Strategy to enable the transition to low-emission and distributed energy sources and to plan for the future of our power system (WA Government, 2021[18]).

The Pilbara has many assets to become a key player in the national strategy to deploy clean energy technologies. While the region is a high emitter, it has an export-oriented infrastructure (trains and ports), large solar and wind resources, large areas of undeveloped land and established global energy companies that can help to deploy renewable energies. Increasing clean energy solutions offers the opportunity to decarbonise the mining process and the country’s energy mix while providing new income sources and affordable energy supply for regional industry and local communities, particularly First Nations people.

A large-scale renewable generation that supports the production of minerals is in fact needed to demonstrate low-carbon supply chains, which will be increasingly important to reach new markets and customers that prioritise sustainability. For example, it can accelerate the goal of exporting low-carbon iron ore to support the production of green steel.

Mining companies in the region are set to play an important role in the deployment of renewable energy technologies in the region as it is the cornerstone to reducing carbon dioxide (CO2) emissions and improving attractiveness for ESG investment and social license to operate while reducing the operational costs of mining. Renewable energy is also an opportunity to reduce the cost of mining operations as most mining sites currently source energy mostly from non-renewable sources – gas to power the mines and processing plants and diesel to run the trucks and trains. Most of the big companies in the region have already set investment plans to increase renewable energy sources, mainly focused on solar power to feed mining sites (Box 3.3).

In addition, the Pilbara is well positioned to advance production at scale and eventually export hydrogen. The federal and state governments provided funding to create one of Australia’s first hydrogen hubs in the Pilbara, with the aim to fast-track renewable (green) hydrogen production and exports. The Pilbara Hydrogen Hub includes various projects such as a hydrogen and/or ammonia pipeline between the Maitland and Burrup Strategic Industrial areas, a Clean Energy Training and Research Institute to develop the required skills for the emerging industry and port upgrades to enable the import of oversized renewable energy equipment (e.g. turbine blades). These complement advanced projects aiming at developing and exporting both green hydrogen and emissions-free materials: for example, the Yuri Green Hydrogen Project is one of the largest of its kind in Australia and capable of sourcing green hydrogen into the Yara ammonia production plant, enabling the export of green ammonia and production of green hydrogen at scale.

Hydrogen will provide the opportunity for the Pilbara to provide greater amounts of energy with more reliability than solar or wind power. This could reduce energy costs to incentivise the development of downstream facilities and feed the fleet of trucks and boats that transit in the region. In fact, the region is well placed to show short-term gains in implementing the state government’s strategy to accelerate its production and adoption of hydrogen (Box 3.4). Many areas of this strategy still require significant technology development to be achievable but opportunities for remote application, where hydrogen can be used at the site of production, negating the need for transport and storage, seem to be the most viable opportunity in the short term. This is particularly beneficial for the Pilbara and its dispersed mining sites as it can reduce the use of diesel in operations and transportation.

However, the deployment of renewable energies needs to have a community focus to ensure people in the Pilbara benefit from this growing sector. The strategic deployment of renewable energy is also an opportunity to diversify the local economy and reduce income inequality by involving new local businesses and promoting the integration of First Nations in the value chain of renewable energy solutions. Renewable energy projects offer some short- to medium-term business opportunities in the construction phase and some more long-term opportunities in the form of maintenance during the operational phase. These projects can bring a number of additional opportunities for the region and its population, such as:

  • A greater tax base for local governments, which can be invested in improving service delivery, as was the case in Abruzzo, Italy, or Scotland, United Kingdom (OECD, 2012[21]). In the case of Pilbara, this opportunity will rely on the land where these technologies are established (see Chapter 4).

  • Extra income for land owners and land-based activities. For example, farmers and land owners who integrate renewable energy production into their activities can diversify and stabilise their income sources (OECD, 2012[21]). For the Pilbara, this involves exploring diversification permits for this purpose, which can also apply to mining leases.

  • New indirect jobs. While the number of new jobs created by renewable energy projects is limited (mainly in operating and maintaining equipment), rural communities can implement strategies to benefit from indirect jobs arising along the renewable energy supply chain (construction, manufacturing and specialised services). This was the case in Extremadura, Spain, where the newest manufacturing jobs were created in firms producing metal frameworks to support solar energy installations (OECD, 2012[21]).

  • Delivery of affordable and clean energy will reduce the cost of doing business and accessing housing. This can be particularly relevant for people who do not work in mining activities and want to settle in the region, as well as for Aboriginal communities.

Accelerating the deployment and adoption of renewable energies in the Pilbara needs to overcome a number of challenges.

First, a high reliance on and good accessibility to affordable LNG. Unlike other OECD mining regions, the Pilbara has a higher competitive advantage in consuming LNG, given the in situ natural gas resources, historical infrastructure investments and Western Australian government policy that ensures a share of production for the domestic market. Many other jurisdictions, including traditional energy importers, have equivalent domestic infrastructure suitable for hydrogen generation (e.g. China), paired with, in many cases, existing hydrogen production well in excess of Western Australia’s. Furthermore, green hydrogen (produced with energy from renewable sources) still requires technological progress to become an economically viable alternative; in the transition, blue hydrogen (produced with fossil fuels but captured in carbon capture and storage projects) could be a transitional fuel in the region.

Second, the labour shortage and the cost of construction due to remoteness is a challenge. Salaries for workers who deploy renewable energy solutions must compete against the salaries in mining operations. Shortage of affordable housing also undermines the labour force supply in the region (see Chapter 4). Transport of materials to the region adds to this cost.

Furthermore, access to land for renewable energy can pose an important challenge to accelerating the pace of the deployment. As Chapter 4 will depict, new projects require high shares of land as the renewable ones need to overcome some challenges in land management in the region, including the timing of allocation of state lands and a coherent process to negotiate with Aboriginal communities to use First Nations land.

Overcoming the abovementioned challenges needs a comprehensive public strategy to collaborate with the private sector, facilitate access to the labour force and reduce costs such as transport. This strategy should ensure a positive connection between renewable energy projects and development in the Pilbara by ensuring these projects integrate rural economies within larger supply chains while mitigating the adverse effects on current or potential economic activities, including agriculture and tourism. This should be seen as a strategic policy to enhance market opportunities with traditional trade partners, such as Asian countries, but also with countries adopting more environmentally driven trade policies, like European Union countries.

The Commonwealth has an important role to play in incentivising a greener and diversified future for the Pilbara. Targeted incentives to increase the deployment of renewable energy technologies, including some added-value stages (e.g. assembly, maintenance or repair), is an important area for action for the government. In other countries like the United States and in European Union zones, national policies have adopted active support in the form of tax credits and incentives to accelerate the deployment of renewable energies. For example, the US Inflation Reduction Act (IRA) released USD 370 billion in funding to provide tax credits for clean energy projects to promote investments in manufacturing clean technologies in the country. In less than 6 months after the IRA, 100 000 green jobs were created, including electricians, technicians, mechanics and construction workers (WEF, 2023[22]). To this end, as previously recommended by the OECD, the federal government of Australia needs to develop a national long-term emissions reduction strategy that defines clear goals and corresponding policy settings for the path to achieving net zero emissions by 2050 (OECD, 2021[17]). This strategy should prioritise incentives for the deployment of renewable energies in mining regions.

In parallel to those incentives, a clear monitoring and public reporting of GHG emissions in the Pilbara, along with other regions of Western Australia, should be promoted as a strategy to improve transparency in the environmental impact of mining and to accelerate investments in renewable energies.

The government can also better co-ordinate the mining-led renewable energy projects to accelerate the deployment of clean energy sources in the region and create a favourable ecosystem for the net zero economy transition. The renewable energy projects of mining companies are done in silos, with almost no co-operation among them. Each company has an individual transport, storage or assembly facility. The federal government’s project to support common-use port upgrades in the Pilbara (e.g. expand Lumsden Point in the port of Port Hedland) is a first step in the right direction to create infrastructure for common use and increasing the capacity to export battery metals such as lithium and copper concentrates, as well as import renewable energy infrastructure (e.g. wind turbines and blades). But there is still scope for unlocking further synergies with common solar or wind facilities as well as co-investment in energy transmission infrastructure that covers other users beyond mining sites, including towns and ports.

The Commonwealth and the state can leverage the growing interest in renewable projects in the region to boost development opportunities for First Nations people and local businesses by facilitating equity stake or ownership schemes for generation or transmission projects. The deployment of renewable energy can be an example of a new model that shares and empowers local communities. It will also ease the deployment of these projects in the Pilbara, as they require extensive land and thus negotiation and approval of First Nations owners. Other OECD countries have support schemes where First Nations are active partners in energy projects (Box 3.5). While capacity building is still needed to help establish First Nations companies able to manage this type of project, many communities have the potential and knowledge. In many cases, the main bottleneck is rather the access to finance and the channels and trust to build equal-power partnerships with energy and mining companies. Therefore, the state could support First Nations to participate in renewable energy business by acting as a broker in partnerships with energy companies and providing public loans or debt guarantees to support funding.

Circular economy practices in mining can open up new business opportunities locally, attract new investments and reduce the negative environmental effects of mining. The circular economy is about preventing wasted resources, improving the durability of goods and products, and transforming waste into new inputs or products (OECD, 2020[26]). In mining, circularity can translate into more efficient use of natural resources needed for the mineral extraction process (e.g. reuse of water) and reuse of mining waste (e.g. rock, slag), non-mining waste (e.g. oil, office waste, old technology) and mining infrastructure (e.g. mining sites’ structures or transport infrastructure). The mining sector also has a key role in supporting circularity in other economic sectors by promoting greater reuse of machines and equipment used in mining operations or supporting urban mining (extracting minerals from common-use traditional and electronic devices). It can also incorporate the sequestration of carbon through processes such as geological sequestration, mineral carbonation or revegetation.

These circular mining processes can bring a number of opportunities for environmental, economic and social outcomes. For example, reusing mining waste (also referred to as tailing remaining rock after the extraction of valuable minerals from the mined ore) is of growing importance across different countries (Finland, Canada, Finland, Portugal, Spain) given the important number of existing tailings already stocked and the expected amounts from future operations. Mining waste in some mining operations can be more than twice the amount of ore extracted. For example, for each tonne of iron ore extracted, it is estimated that between 2 to 12 tonnes of overburdened material is removed as waste (Kinnunen and Kaksonen, 2019[27]; Mohanty et al., 2010[28]).

Promoting the mining of tailings can be an opportunity to unlock new types of business, reduce the environmental impact of new mining operations and ensure the supply of minerals and raw materials. This is an area with a great number of possibilities but without a clear global frontrunner, as circular processes can be very specific to local mining operations. Beyond economic opportunities, mining tailings can benefit from greater societal support and be combined with environmental policies to clean hazardous waste. One potential process that is also gaining increasing attention in this regard is mineral carbonation, whereby the natural process by which minerals draw carbon from the atmosphere is accelerated through engineering intervention.

However, creating a system that harnesses the benefits of a circular economy in mining requires addressing multiple barriers, including technological development, environmental and administrative regulation and market and value chain bottlenecks (Box 3.6).

The Pilbara can mobilise its know-how to promote new business in circular mining. This is an important opportunity in the region, given its daily production of mining waste and the number of abandoned mines in the territory. Major mining companies in the Pilbara have already acknowledged the relevance of circularity and recycling and started putting in place actions at the operational level (Box 3.7).

However, there is scope for mainstreaming circular approaches in the overall business model, communications (e.g. in regard to their sustainability reports) and the involvement of the local businesses (Upadhyay et al., 2021[29]). Likewise, some of the companies operating in the Pilbara are pushing the frontier in circular practices with ongoing trials in other mining sites around the world, which could be translated into the Pilbara. For these, the size of mining sites in the Pilbara and the high temperatures should be used as an incentive for experimentation on circularity in the region.

Mining companies can play a greater role in incentivising circular and sustainable practices across their providers. Encouraging providers to follow due diligence guidelines or ESG practices is in the interest of the company to improve trade with new markets as well as with the communities and government. Prioritising providers established in the region with more sustainable practices can help reduce the environmental impact of mining across the value chain while triggering innovation in the local economy. The state and local governments can have a role in this process by facilitating the exchange of practices among local providers and companies with innovative and sustainable providers in other countries and universities. The PDC and local government should also encourage mining companies to use reporting mechanisms related to procurement, for example the Mining Local Procurement Reporting Mechanism from the Engineers Without Borders Canada Mining Shared Value initiative.

The Pilbara’s mining sector also has relevant opportunities to promote the recycling business of mining equipment. By virtue of the volume of conveyor belts and particularly large truck tyres used in the iron industry, tyres seem to be one of the most attractive businesses in terms of recycling. According to Tyre Stewardship Australia’s 2020 Off-the-Road Used Tyre Analysis report, 93% of the metric tonnes (Mt) of used tyres in the Australian mining industry (68 100 Mt in 2019) were disposed of on site, piled up or buried, 3% were sent to landfill and just 1% was recycled, with the remainder stockpiled or used in civil engineering (Tyre Stewardship Australia, 2020[35]).

While many of these investments in circularity are privately led, the Western Australian government and local governments in the Pilbara have a relevant role in incentivising and facilitating the circular economy process in mining. First, they can promote partnership opportunities with new businesses or research organisations to ensure appropriate value chains in the transition to the circular model. As waste valorisation is not a core business for big mining companies, many of these companies would be willing to partner with other companies and organisations. The government should be the broker that gathers providers, companies in transformation activities, mining companies and research organisations to explore the opportunities around circularity and define possible projects of common interest. This networking support could allow big mining companies in the Pilbara to promote and integrate external innovations on circularity, e.g. on the reusing and recycling process. The case of Norrbotten and Västerbotten in Sweden can be an example of developing partnerships to attain a more sustainable mining process (Box 3.8).

Second, the government needs to actively contact and attract new companies to participate in the circular process in the mining value chain. In many cases, companies with expertise in recycling or reusing are not present in the region. Facilitating the establishment of these companies in the region can accelerate the rise of circular business. An interesting example is the effort by the local government of East Pilbara to contact and make the business case to attract foreign companies with expertise in recycling tyres into the region. In view of the attraction of circular economy companies to conduct the circular process in mining, the government of Western Australia should facilitate interested companies’ access land in the region. As the next chapter will discuss, access to land in the Pilbara is a major challenge for establishing new industrial parks or industrial sites and providing affordable housing to the labour force. Co-ordinated work among local, state and federal governments to provide land and basic services for these potential industries in mining circularity should be part of a sustainable mining strategy in the region.

Third, governments can accelerate the adoption of circular processes with regulations or policy incentives. For example, Chile recently introduced a law which specifies that, starting in 2023, 25% of mining tyres must be recycled, which should increase to 75% as of 2027 and 100% as of 2030 (Box 3.9). Moreover, environmental regulations might face challenges to assess and facilitate projects to mine tailing or closed mines. To promote circularity, the Western Australian state government should consider regulations and policies to lead companies to adopt circular processes and report their progress.

Circularity in mining also refers to strategies to make the best of abandoned mining sites or operations. With data up to 2012, it is estimated that there are about 10 000 abandoned mines across all of Western Australia, many of which had previous exploitation of gold (WA Government, n.d.[40]). Many of these abandoned mines ceased operations prior to the introduction of environmental approvals, which required rehabilitation and were left by the companies without any measure to mitigate the environmental impacts of these sites.

The government of Western Australia has identified abandoned mines as a relevant challenge in Australia and the region. This issue led to the confirmation of a senate committee to investigate the rehabilitation of abandoned mines. Rehabilitation of abandoned mines could allow grazing, tourism or food production activities.

Beyond mining, the Pilbara also has a growing opportunity to reuse decommissioned infrastructure from offshore oil and gas operations. Over the next 10-20 years, an increasing number of offshore oil and gas facilities in the Pilbara will cease producing hydrocarbons and will need to be dismantled. All over Australia, the infrastructure to be decommissioned includes 57 platforms for a total weight of 755 000 tonnes, with a large share located in the Carnarvon Basin, offshore the Pilbara (Melbourne-Thomas et al., 2021[41]). Australian legislation requires oil and gas companies to develop acceptable plans to safely remove all offshore infrastructure at the end of a project’s life (Shaw, Seares and Newman, 2018[42]). Studies have shown clear benefits of leaving oil and gas infrastructure in situ to support biodiversity and marine fauna, albeit others that demonstrate these structures pose a risk to the environment (Melbourne-Thomas et al., 2021[41]).

As some offshore infrastructure will require removal, there might be opportunities to reuse equipment that is still in working order as well as to recycle large volumes of material such as steel, concrete and plastics. Reusing these large amounts of infrastructure requires a strong enabling environment with a collaborative approach to enhance cost-effectiveness and environmental outcomes. Furthermore, facilities and land located on the coast will be required to bring infrastructure ashore and process it.

Overall, the government of Western Australia, in collaboration with local governments, should promote circular practices in mining by:

  • Developing a comprehensive strategy to map the opportunities of the circular economy across the mining value chain in the Pilbara, support the uptake of circular practices and increase the involvement of local communities and businesses in these new business models. This should include targeted capacity building for local businesses and fast-track processes to promote recycling businesses in mining, mining tailings, secondary use of abandoned mines and reuse of decommissioned offshore oil and gas infrastructure.

  • Considering new regulations and policies to accelerate the adoption of circular mining processes with improved progress monitoring. Chile’s regulation on recycling mining tyres is a good guide in this regard.

  • Promoting networking events to attract companies with expertise in mining circularity (e.g. recycling of tyres) and multi-stakeholder discussions with providers, mining companies and academia to explore the opportunities around circularity and come up with possible projects.

  • Updating the information on tailings and abandoned mines. The dataset of mines and minerals deposits from the DMIRS provides a good base for this type of mapping but its information needs to be updated and include greater geological information, specifically to promote the mining of tailings.

Moving towards environmentally sustainable mining in the region requires regaining communities’, especially First Nations, trust in the possibility of achieving a green mining process. Transparency is a first step in this process, which can be done by better sharing companies' efforts and investments in this matter. Mining companies in the region have complied with international due diligence and guidelines (such as the sustainable mining guideline of the Mining Association of Canada). However, this information is scattered on each company’s website. The government can improve this transparency by creating a single site for citizens to consult all of the certificates and due diligence carried out by the different mining sites in the Pilbara.

But certifications alone are often not enough to build citizen trust, as these processes tend to happen without community involvement. Going a step further would be to ensure First Nations and community representatives are involved in the certification process or adopting processes that already involve citizens as part of the process. Other regions, such as Antofagasta in Chile, have also empowered citizens with technological tools and access to mining sites in view of conducting independent monitoring of the environmental impacts of mining operations.

In addition to the advantages provided by its rich geology, geographic location and export-oriented infrastructure, the Pilbara has a diverse amalgam of cultures and environmental amenities that can be mobilised to diversify the economy and gain resilience. Traditional owners have conducted non-extractive activities for millennia, including the application of traditional knowledge to produce food. Likewise, the region’s towns benefit from a relatively high share of young people, bringing opportunities for new businesses and ideas.

Nevertheless, as in many remote OECD mining regions, economic activities outside resource extraction sectors tend to be limited due to the lock-in effects produced by the high reliance on mining, the small internal markets that hamper economies of scale and the remoteness that increases the cost to transport goods and people. Promoting diversification requires an active policy approach to overcome these challenges, which otherwise would discourage entrepreneurship and the emergence of new businesses outside the resource sector.

The region has already acknowledged the need for an active approach to further diversify the economy and has conducted a number of policies to support this process. The most relevant is the PDC’s strategic plan for 2019-21, which identifies a number of potential economic sectors for the region, in line with the state’s strategy Diversifying WA. They include:

  • new resources – sand, magnesium, cobalt, sulphate of potash

  • logistics, engineering and supply chains

  • innovative technology

  • SMEs

  • agriculture and aquaculture

  • energy

  • tourism

  • arts and culture.

Despite this government effort, the Pilbara remains an economy with low levels of entrepreneurship relative to Australia. The government has the scope to adopt active policies that help focus on non-extractive activities and create a coherent vision among local actors of the future of the economy outside mining. This section discusses potential strategies that can help with the ongoing effort to diversify the economy, including supporting entrepreneurship, social economy and tourism.

The small internal market, the dominance of extractive industries and the high cost of living in the Pilbara have led to an underrepresentation of SMEs in the region compared to national averages (Chapter2). In a labour market with very low levels of unemployment, competing with the high salaries and workforce needs of the mining sector is a common barrier to diversification in the Pilbara, as in other remote OECD mining regions (OECD, 2023[43]). SME activity in the Pilbara tends to be predominantly in construction, rental, real estate, warehousing and logistics, activities that are closely aligned with the resources sector and thus subject to its cyclical fluctuations (RDA Pilbara, 2020[44]). Instead, businesses in other sectors, such as education, retail and professional services, are underrepresented across the Pilbara.

The underrepresentation of entrepreneurs and SMEs in a region not only undermines resilience and economic diversification but also limits innovation, knowledge diffusion and social cohesion as small businesses respond to new demands and social needs, and contribute to empowerment and inclusion in society. In fact, across the OECD, some of the most relevant forms of innovations come from entrepreneurs that are considered “unicorns” (the rare number of new entrants that become high-growth firms), conduct disruptive activities (entrants that radically change incumbent competitor’s business models) or build and innovate through marginal changes (entrants or incumbents that practice slow innovation) (OECD, 2022[45]).

To address this issue, the government of the state of Western Australia and the PDC have invested in projects such as a network of co-working and innovation centres. The region has three main innovation centres set up as not-for-profit organisations to accelerate small business growth and entrepreneurship in the region:

  • The Enterprise Hub Karratha, delivered by the Business Centre Pilbara, is a flexible space incorporating co-working areas, incubation suites, meeting rooms and space for business and community events.

  • The WEB Business Hub in Port Hedland provides flexible co-working accommodation and tailor-made innovation programmes to encourage entrepreneurship and support new and existing small businesses.

  • The Edge in Newman is a multi-purpose business incubation hub that includes the following facilities: a community kitchen, a food court, two pop-up retail spaces, a mezzanine for temporary office space and a co-working office space.

Furthermore, the government has implemented support for larger networking initiatives such as the Creative Business Development Series to provide participants (mainly individuals in art and creative industries) capacity building tools, with talks and workshops facilitated by industry experts.

These plans are the right step to create agglomeration economies and promote networking with the critical mass of the workforce that is in the region. However, they will have little success if the challenges of the cost of accommodation with a policy to attract new workers are not addressed, as further discussed in the next chapter.

Beyond the cost of living challenge, government strategies for entrepreneurship and SME development in the Pilbara can be reinforced with a combination of formal networking opportunities that create scale and targeted support to different parts of the population, including mining employees, First Nations peoples and women. First, the government can establish a formal networking mechanism in the region to target entrepreneurs and small businesses in different sectors and connect them with large firms, private financiers and research centres. Several business-oriented events in the region, such as the Pilbara Summit or Pilbara Creative and Cultural Forum, are intended to promote networking and business support. Yet, some of the existing fora either have entry fees that discourage the participation of part of the population, focus mostly on the extractive sector or exclusively target First Nation people. A comprehensive forum that focuses on small businesses and entrepreneurship can attract First Nations and non-First Nations people and serve as a platform to showcase good experiences and facilitate access to government programmes. This can be a platform for innovation centres to present the results of their work and mobilise their networks of small businesses.

Second, with most of the workforce already employed in the Pilbara, the state government department should leverage the existing human capital working in mining companies to support intrapreneurship. Intrapreneurial programmes are associated with the in-company incubation of employee-driven initiatives that eventually spin off from the company to become independent entrepreneurial entities. Such intrapreneurial incubation can act as an outlet for employees’ creativity and innovativeness. Mining companies can be interested in promoting intrapreneurship for different reasons: i) improving relationships with local communities and becoming more attractive for the workforce; ii) standing out globally with ESG practices that can be promoted internationally; or iii) promoting a vertically integrated value chain with companies that provide services tailored to the needs and working culture of the company.

This strategy could benefit from government support to allow mining workers access to capital or business plan training or legal advice. Innovation centres in the Pilbara can also proactively reach out workers in extractive industries and encourage entrepreneurship. Besides training assistance, intrapreneurship support programmes can locally work alongside the firms to help plan and implement the creation of innovative career paths inside companies and support the incubation of projects to address future needs of the mining industry (e.g. in the green transition). These training programmes can be supported or outsourced to a university or a dedicated research centre for mining.

Finally, capacity and training should be increased to support entrepreneurship within the First Nations population. First Nations peoples are the layer of population with the greater unemployment and inactivity rates (Chapter 2), which is explained by unequal access to tailored education and training support, among other structural reasons discussed in the next chapter. Better involving the First Nations population in the regional economy will lead to multiple benefits in the region, including improving social cohesion, opening new growth economic opportunities locally and increasing regional attractiveness. This objective lies within a broader set of national and state policies that are undergoing a transformational process to improve the quality of life of this population (see next chapter).

There are already good cases of First Nations companies working in the mining industry that can serve as leading examples to motivate other First Nations people to start a business or access long-term jobs (Box 3.11).

Finally, the Pilbara can mobilise the women in their workforce with adapted entrepreneurship strategies. The region has a relatively low level of women’s participation in the labour market (Chapter 2), which can be associated with childcare access issues that push women outside the labour market or some mining tasks and lifestyles that can disincentive women’s participation. Increasing women’s labour opportunities would require a combination of better accessibility to family care services and specific support for work opportunities. In remote regions like the Pilbara, focusing on women’s involvement in the labour market can also mean increasing regional attractiveness for families and enhancing the sense of belonging to the territory. The PDC could revisit entrepreneurship support for women with strategies to promote role models, develop tailor-made entrepreneurship training and create women’s networks and family care services for self-employed women (Box 3.12).

Promoting a social economy can help the Pilbara strengthen community cohesion, reduce inequality and unlock job opportunities outside extractive sectors. Social innovation is particularly important in remote areas because it fills in the gaps caused by a truncated market economy that provides only a limited number of goods and services and local governments that have too few resources. In rural areas, high levels of social capital may be more important for economic and social development because it can increase social innovation (OECD, 2022[45]). Social economy refers to certain types of entities that contribute to economic activity with an express social purpose: associations, co-operatives, mutual organisations and foundations. Specific principles govern these organisations, notably: i) solidarity and mutuality; and ii) the primacy of people over capital or democratic and participative governance. Social economy organisations pursue activities in a wide range of sectors, such as banking, insurance, agriculture, health, social services and others (OECD, 2020[51]).

In the Pilbara, different social organisations are mainly working around issues of First Nations communities. These organisations perform activities to reduce addiction among the young, provide elderly and childcare, integrate persons with disabilities or help protect the environment.

The Pilbara and Western Australia have the scope to fully harness the potential of social enterprises to improve well-being and create new job opportunities. The first step is to map and showcase the existing social enterprises and their role in the different communities. Highlighting publicly the relevance of these organisations in providing support to the well-being of the communities will increase the recognition of their work and create opportunities for co-operation and funding. This is of special relevance for First Nations-related enterprises that perform activities to reduce addiction among the young, provide elderly care or protect the environment.

The second step is to support access to long-term finance for social enterprises. In the Pilbara, social enterprises mainly receive funding from the government or mining companies. However, this funding tends to be short-term and with no fixed amounts. There is a scarcity of established social or impact-driven investors in the Pilbara and Western Australia, which reduces the funding sources for social enterprises in remote areas. Therefore, providing long-term finance with a greater pool of sources can increase the resilience of these organisations, making them less vulnerable to political or mining cycles. This can be addressed by disposing of funding lines from the royalty’s system to these enterprises or creating better links with private financers. On the other hand, bridging the gap between traditionally grant-reliant social enterprises and commercially oriented private financiers requires specialised intermediaries that can broker dialogue and design a financial offer satisfactory for both parties (Box 3.13). The PDC already has a specific team working on communities that can play the role of both the broker and the provider of long-term financial support.

Finally, the region can rely on existing social enterprises to help identify and promote new business opportunities. Many of these social organisations have networks with population segments that are less engaged in mainstream economic activities or official programmes. For example, in Canadian rural regions with a significant number of First Nations people, social innovation has been especially important as a way to expand economic opportunities in societies with different social norms and as a bridge between First Nations and non-First Nations firms and governments.

The digital transition in mining will bring different opportunities and challenges for the Pilbara (Chapter 4. Opportunities span from greater salaries and productivity for the region, with fewer activities requiring human physical strength and therefore opening up the workforce to a larger pool, including the elderly and women. However, digitalisation can displace some workers, increase the inequality gap and allow for remote work from outside local communities. Many companies in the region have started automation processes, mainly in trains, trucks and mining equipment.

Against this backdrop, the state is investing in upskilling and reskilling the workforce, including the development of education and training packages specific to the renewable energy industry, such as the design and installation of on-grid and off-grid battery storage systems.

A main challenge for the Pilbara is defining how to prepare human capital for the digital transition in mining and who is best suited to deliver such instruction. There are no dedicated universities in the Pilbara that can train the workforce or young population for the specific needs of the region. Improving access locally to high-level specialised education can also help retain young people and attract families to the region. Recommendations on this will be further developed in Chapter 4.

Universities and educational institutions can help the state and local governments establish long-term plans to improve both skills and innovation systems. Outsourcing skills strategies to educational institutions is particularly important for rural governments that lack staff capacity and critical mass. Universities can also be involved in the definition of diversification strategies for the Pilbara. This type of model has brought positive outcomes to other OECD regions, for example the agreement between the regional government of Värmland and Karlstad University in Sweden to develop the Academy for Smart Specialisation with the aim of promoting regional development (Box 3.14).

Supporting the green transition of the Pilbara’s mining sector and leveraging its potential to unlock new economic activities requires a co-ordinated effort across different levels of government and the private sector. In Australia, this regional development co-ordination relies on the state government, which has the primary role in regional development. Local governments have responsibilities defined by the state and deliver a relatively narrow range of services, with decisions that can be overturned by the states (Box 3.15).

The national government (also referred as Commonwealth) acts as a key investor, mainly around regional development infrastructure (e.g. transport). Other federal funding programmes include subsidies for public services in remote locations in each state, while regional development agencies (RDAs) promote Commonwealth programmes in the region and provide the Commonwealth with information on regional issues. However, in many instances, there are overlaps in mandates between the Commonwealth and the states. For example, in healthcare, the Commonwealth funds general practitioner services, while the states are responsible for segments of primary service and for managing, running and partly funding public hospitals (OECD/UCLG, 2022[55]).

The Pilbara has four local governments that cover vast territories with low population density: i) the City of Karratha is the most populated municipality in the Pilbara; ii) Port Hedland, home of the world’s largest export commodity port; iii) the Shire of East Pilbara, the largest municipality in Australia, which is larger than the whole state of Victoria; and iv) the Shire of Ashburton, the most southern of the Pilbara shires (Chapter 2).

The Pilbara Regional Council serves as the fifth statutory local government to ensure co-ordination among the abovementioned four governments. This council was established in 2000 as a collaborative partnership between the four Pilbara local governments and undertakes tasks on bureau services (ensuring effectiveness and efficiency in project management or identifying opportunities for economies of scale) and advocacy to the state and federal government (e.g. lobbying to attract events). Each local government appoints two councillors to join the regional council.

The development of the Pilbara is mainly guided by Western Australia state policies and strategies. The state government, through its departments and particularly through the PDC that is in charge of promoting the Pilbara’s economic development. The PDC -under the WA ministry for regional development- helps link state policies with regional stakeholders, identify the main development priorities and establish the strategic vision. State departments design and implement their regional sectorial policies and help co-ordinate regional development (e.g. the central government department).

The Pilbara benefits from a range of development strategies that recognise the need to further diversify the economy and improve well-being. The overarching strategic documents guiding the development of the Pilbara have a pilar on diversification and underline the need and relevance of liveable communities (Table 3.7). These state government plans are informed by a number of thematic strategic documents that focus on specific sectors. For example, the main roadmap for the Pilbara region – the PDC 2019-21 Strategic Plan – establishes a vision for the region to attain “vibrant and sustainable communities underpinned by a strong, diverse economy” (PDC, 2019[56]).

However, the Pilbara does not count on a master plan or vision with mechanisms that help co-ordinate actions across different state ministries for long-term strategies. Development plans are often managed and delivered independently by each ministry, following its thematic portfolio. These ministries manage their sectorial funds and their implementation, which the PDC supports in some specific programmes. In this setting, there is a lack of common objectives and monitoring indicators across ministries for the development of the Pilbara. For example, the departments responsible for infrastructure and energy can both implement relevant projects for the Pilbara without necessarily having previous co-ordination or shared programmatic objectives.

On top of that, the Pilbara’s policy making has been historically top-down driven. The Pilbara’s top-down approach is grounded in the region’s industrialisation process that relied on direct agreements between the state and private companies to secure the significant investments needed to activate natural resources in the region.

This approach has resulted in limited integration of local initiatives in regional development and subsidiarity in governance, which hampers responsiveness to local needs and aspirations and, in turn, the capacity to sustainably address well-being and economic diversification challenges. The footprint of the Pilbara’s mining industry, combined with a significant portfolio of what is termed “state agreements” has led mining companies to conduct government functions at the local level, such as provision and management of utilities (e.g. water or electricity), housing and even some public services such as childcare.

While initially this development approach helped ensure quality lifestyles, especially for mining workers and their families, this has also restrained the scope for local government revenue raising (Wilkinson et al., 2023[54]) and reduced public capacity to broaden these services to non-mining workers. This has been recognised by the Pilbara local governments for some time (ALGA, 2023[57]) as well as companies who are not in the position nor equipped to fully overtake government functions at the local level. In this structure, bottom-up projects defined by local associations or LGAs often need to apply for funding from the state, which can lead to delays in time, given the capacity of LGAs to design and structure the project application. The limited involvement in policy decision making also extends to First Nations and communities, which face even fewer institutional channels to participate in the planning and development decisions for the region.

The government had already implemented strategies to promote a bottom-up approach to improve well-being in the region. A significant sub-programme of the Royalties for Regions programme was an investment agenda referred to as Pilbara Cities that was intended to transform the population centres across the Pilbara region to attract new permanent residents from Australia and overseas. Between 2009 and 2015, approximately AUD 1.7 billion was invested under the Pilbara Cities programme, which helped build health, education and recreational facilities. Programmes were identified based on local needs and the PDC performed a key role in the co-ordination of resources and implementation of projects. Despite the positive results of this programme in delivering projects tailored to the basic needs of quality of life in the Pilbara’s towns, it found difficult to create complementarities with economic diversification strategies to unlock new job opportunities and empower LGAs to ensure sustainability and ownership of the projects.

Against this backdrop, attaining a more diversified and inclusive development in the Pilbara relies on the capacity of the different governments to follow a common vision and work with regional stakeholders to implement strategies tailored to the most pressing local needs. To this end, the Pilbara needs a modern policy framework that: i) sets a long-term vision for development; ii) improves the participation of LGAs, First Nations and other regional stakeholders in policy making to adapt policies to local needs and grasp bottom-up solutions; and iii) strengthens the co-ordination of policies within the government to improve efficiency and scale in implementation.

The Pilbara would benefit from such a long-term vision that helps guide the state ministries’ actions as well as provide investment certainty in the region and create the ecosystem for synergies among regional stakeholders (LGAs, First Nations, mining and non-mining businesses).

For the Pilbara, this vision needs to better clarify the role of the extractive industries in improving regional well-being in economic, social and environmental terms and also outline strategies for a future without those extractive industries. This plan should include a strategy to benefit from the strategic proximity to Asia and the existing commercial links with this market. With investors, companies and society increasingly focusing on social and environmental outcomes of extractive industries, the Pilbara can position itself as a benchmark region in “responsible sourcing” of emissions-free raw materials and products (e.g. green iron ore, lithium or ammonia) and in the integration of First Nations within the economy. This means further ensuring and promoting extraction, processing and trade of minerals conducted in socially, environmentally and economically sustainable ways that do not contribute to the generation of human rights abuses (OECD, 2016[58]). In doing so, the Pilbara can increase social licence for future investments and unlock other market opportunities for its METS companies in Asia. To do so, the PDC and Western Australian government could support conferences on responsible sourcing with a focus on Southeast Asian participants.

Developing this overarching vision requires consensus within the regional government and different actors at the local level. This vision needs to gather views on the role of mining for local development and concerns about the effects of this activity on the environment and society. Some useful techniques to set strategic visions include interactive methods of brainstorming, community assemblies and roundtable discussions. This vision is usually defined first by a small group of main stakeholders and then shared with wider stakeholder groups for discussion and consensus.

Other OECD mining regions have developed long-term mining visions based on strategies that go beyond the support of mining towards an overall goal to improve the well-being of the region. This is the case of the region of Antofagasta, which has developed a mining strategy for well-being with a vision until 2050.

For rural and low-density regions, policies that adopt a consistent approach to enable communities to translate their needs into concrete strategic plans benefit from tailored solutions and local buy-in to ensure their implementation over time (OECD, 2020[59]). While a policy approach that includes bottom-up initiative in the Pilbara might take longer to build and imply greater resources to integrate the views of dispersed communities across a vast territory, the process itself will help create social cohesion and more sustainable policy outcomes while improving the sense of belonging in this region. This approach should help identify common development objectives for the Pilbara and specific actions per state department are instrumental in the horizontal co-ordination.

Other OECD mining regions have adopted such a place-based approach in collaboration with the private sector to shift the narrative about structural challenges, such as remoteness and harsh weather, towards advantages. For example, previously thought challenges in Lapland, Finland, like the remoteness, the cold temperatures (-30 degrees Celsius or °C) and darkness (50 days of 24-hour darkness), are now some of its main assets, attracting tourists and investors to experience the advantages offered by this particular setting (e.g. environmental beauty or First Nations know-how).

In the same vein, Fort McMurray, an urban area located in the province of Alberta, Canada, and considered one of the hubs of Canada’s petroleum production, has seen its population more than double between 1990 and 2022 (Government of Alberta, 2023[60]). This is despite a subarctic climate with average low temperatures of about -22°C in winter and only 3 months in which average temperature is higher than 10°C being prone to wildfires, one of which led to the evacuation of the community in 2016. This continued growth of the region has been supported by a number of factors other than economic attractiveness, including the commitment of extractive companies in the region to support housing development with industry-owned housing construction companies and the role of a specific federal development corporation dedicated to improving quality of life in the region (NADC, 2022[61]).

In contrast, policies that are delivered in a largely top-down centralised manner are only likely to work in countries and subnational governments whose different regions are broadly equal on a wide range of socio-economic indicators, including productivity, wages, educational attainment, public investment, professional networks, social capital and civic engagement (McCann, 2023[62]).

In this context, a place-based approach relies on adopting a principle of subsidiarity, where decisions about problems are taken as close as possible to where they take effect, thereby providing greater input to decision making from people whom those decisions affect (Drew and Grant, 2017[63]). Subsidiarity is a growing process in the structure of most modern federated states such as Canada, the United States and the European Union and many of its member nation states. Subsidiarity is particularly relevant for regions with characteristics such as the Pilbara. Its remoteness from centres of state and national government, dispersity of settlements, diversity of First Nations and singular industry dependency place its population and local governance structures in a unique position to grasp development priorities and identify solutions to improve their well-being.

An important step for the Pilbara to ensure views from communities are taken into account in shaping the future of the region is to involve local government structures in the preparation and monitoring process of the main strategic plans at different levels of government. Federal plans often guide state government policies but offer few involvement opportunities for local communities, especially those remote. The state government should adopt a proactive approach to integrate local views with platforms to allow frequent communication and discussion with communities. Some OECD regions have implemented citizen platforms, which contribute to promoting specific regional development strategies and overseeing implementation (OECD, 2020[59]). Relying on social enterprises to discuss policy drafts or propose concrete projects in a strategy can benefit the Pilbara.

Increasing LGAs’ capacity in co-developing strategies is a cornerstone towards a stronger subsidiarity and local participation in policy making. For the Pilbara, this can include involving LGAs in negotiations of new state agreements (which are increasingly rare) or in amendment processes for current agreements. While state agreements were widely used by resource extraction companies at the beginning of the industrialisation of the region, these are less common today. As a number of historical state agreements either had a set end date or a set term for the mining leases issued, parliament has had to consider extensions over recent years. In the last decade, out of 16 bills that have passed through parliament concerning a state agreement, only 3 have ratified the new agreement in its entirety, while the majority (10) have approved amendments. Over the last decade, the Government of Western Australia has increasingly taken the amendment of an agreement as an opportunity to modernise and standardise it or impose additional obligations, again with the agreement of the proponent, for example placing further obligations on the company for community development plans, local participation plans or local content to be implemented for the project. In this case, these amendments are an opportunity to keep modernising the state agreements with the participation of LGAs to improve outcomes for local communities and the environment.

Furthermore, the region needs to advance its anticipatory policy approach and build strategies aiming at outcomes for the region, even by preparing for a future without mining. The Pilbara Regional Investment Blueprint was a good example of setting policy strategies with a forward-looking approach. Despite this increasing acceptance of the importance of future thinking in policy, the state of Western Australia seems to adopt a passive policy-making process for the future of the Pilbara, without clear strategies for imagining the legacy of mining in the region for a more diversified future. The state government of Western Australia should embed a forward-looking and adaptive approach to adapt to unexpected shocks and this entails possible strategies for a different future in the Pilbara. The example of Ireland’s national rural policy can be of guidance for the Western Australian government (Box 3.16).

Implementing a common long-term goal for the region also needs an institutional mechanism that works at the local level to ensure co-ordinated actions horizontally across different state departments and vertically among different levels of government. A specific master plan for the Pilbara’s development must be supported with mechanisms to co-ordinate implementation and ensure long-term monitoring. The monitoring of this plan needs public communication of progress to allow stakeholders to track efforts and improve the accountability of government actions in the region.

LGAs also tend to act in silos in the Pilbara, partly because of the territory’s extension and low incentives for co-operation in the region. The historical transition from closed-mining towns to self-governed areas that look after resources and services to remain attractive has likely impacted self-centred local strategies that relate little with neighbouring areas despite sharing all of the same natural resources. Few LGA strategic plans to attract business or improve well-being involve common actions with other LGAs. At the same time, these LGAs struggle to attract a skilled workforce for a long-term stay, with many public servants coming from outside the region and leaving after a certain period or being hired by mining companies (see next chapter).

The PDC can further support LGAs by providing technical advice and helping them identify synergies among their policies. Co-ordination of the implementation of plans in the region should further benefit from the existing outreach of the PDC. The PDC can further collaborate with the chamber of commerce of each town and the LGAs to identify main local priorities and proposals of action for state programmes. Other mining regions like North Karelia, Finland, have an inter-municipal development agency, Business Joensuu Ltd, from whom municipalities buy services that are not efficiently performed in the LGA due to lack of staff or capacity, including business advisory services, placement and marketing services or space, community and event services (OECD, 2019[65]).

Co-ordination is also required across the different ESG strategies and investments of mining companies in local communities. Most extractive companies in the Pilbara have projects with local communities and towns, spanning from the provision of water and electricity to health and recreational infrastructure. However, these projects are dispersed and they are not taught to replace the long-term provision of public service. Therefore, there is a need for government involvement to help these programmes attain scale and obtain a long-lasting impact for these interventions. For this, the government needs to map the existing projects and their impacts to examine opportunities for co-investment and synergies. The PDC, in collaboration with the DMIRS, can advance in this mapping and, subsequently, co-ordination role.

To improve co-ordination across state departments and among local policies, the state government could leverage existing task forces and outreach with stakeholders to formalise a mechanism to oversee policy implementation with representatives of different stakeholders at once (companies, academia, communities). These multi-stakeholder co-ordination mechanisms have been used in other OECD regions to identify main local needs and agree on differentiated priority strategies for each regional area. This mechanism can take the form of a formal meeting to establish long-term commitments, supported on short-term projects focused on improving well-being in the Pilbara. These mechanisms often need strong political support to maintain the participation and interest of stakeholders in time. The case of Eindhoven, Netherlands, could be a guide for the Pilbara (Box 3.17). The newly created governance mechanism of the region of Antofagasta, Chile, to oversee the regional mining strategy and monitor its implementation is another multi-stakeholder platform that is set to remain beyond the political cycle and provide continuity to projects and the vision in the long term (OECD, forthcoming[66]).


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← 1. Lithium resources occur in two distinct categories: lithium minerals, largely from the mineral spodumene (Li2O.Al2O3.4SiO2), and salts, largely from lithium-rich brines in salt lakes. Australia, Canada and China have significant resources of lithium minerals, while lithium brine is produced predominantly in Chile, followed by Argentina, China and the United States. Lithium brines are the dominant feedstock for lithium carbonate production.

← 2. A critical mineral is a metallic or non-metallic element that has the two following characteristics: i) it is essential for the functioning of our modern technologies, economies or national security; and ii) there is a risk that its supply chains could be disrupted (Geoscience Australia, 2023[68]).

← 3. Scope 1, 2, and 3 are categories of carbon emissions created by a company’s operations and in the wider value chain. Scope 1 emissions are Green House Gas (GHG) directly made by the company. Scope 2 emissions are indirectly made by the company. See: https://ghgprotocol.org/sites/default/files/standards_supporting/FAQ.pdf

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