The Western Australian and Northern Territory Governments have agreed to a 12-month extension of the Memorandum of Understanding with Wesfarmers Limited and Marubeni corporation.
The extension - to December 31, 2001 - will allow for feasibility studies covering part of the Ord river irrigation Area Stage Two development.
Resources Minister Colin Barnett and Primary Industries Minister Monty House said today the extension would see Wesfarmers and Marubeni finalise environmental approvals and conclude negotiations with local Aboriginal people.
Mr Barnett said the project involved the potential irrigation of about 30,500ha of black soil land on the Weaber, Keep River and Knox Creek Plains straddling the Western Australia and Northern Territory border and the construction of a new main irrigation water supply channel M2.
The $500 million project, involving Wesfarmers, Marubeni and the Water Corporation, would result in the production of a 400,000 tonnes-per-year of raw sugar for export.
It would create about 500 jobs during the construction phase and about 500 jobs once it became operational.
Mr House, who is also chairman of the Ord Stage 2 Committee, said he was pleased that the companies had requested the 12-month extension to the Memorandum of Understanding.
“It demonstrates their continuing faith in the project which, upon reaching fruition, will also underwrite the release of land in the M2 area for independent farmers,” Mr House said.
Both Ministers said they were optimistic the proposed $500 million project would proceed to development, especially in light of strong gains in sugar prices during the past 18 months - from around US5.7 cents per pound in mid-1999 to a current trading range of US9.0 to 10.7c/lb.
The Environmental Protection Authority in Western Australia and the Northern Territory Minister for the Environment had each released the first of two environmental assessment reports on the project.
They indicated the project would satisfy all environmental issues in relation to the conservation of biodiversity and that the proposal may proceed to the second stage of environmental assessment.
Both authorities are due to release their second report focussing on environmental management issues early in the New Year.
Commonwealth environmental approval of the project may also be required.
Meanwhile, the Water and Rivers Commission is approaching completion of a revised Interim Water Allocation Plan for the Ord River.
This includes an allocation for the irrigation water requirement of the Project and Ord Stage 1, as well as other consumptive uses and environmental water provisions for the lower Ord River.
The plan is to be submitted to the EPA for approval shortly.
Diana Callander, Minister Barnett’s Office 9222 9699
Peter Jackson, Minister House’s Office 9222 9595