The $16.5 million upgrading of the Leonora-Esperance railway announced today by the State and Federal Government will revolutionise transport in the Goldfields and through the Port of Esperance.
Deputy Premier and Goldfields Minister Ian Taylor said as well as job creation for the region and the benefits to existing and proposed mining projects, it would dramatically slash shipping costs through the Port of Esperance.
"This project will breath new life into the entire region," Mr Taylor said.
"It will also open the way for a greater integration of the region's transport system and will link the Goldfields more directly into the national rail network," he said.
"It is a reflection of the benefits that can flow into the region through reform on the waterfront and the railways."
Mr Taylor said the most immediate effect of the upgrade would be that Portman Mining which was re-opening the Koolyanobbing iron ore mine, could rail 1.5 million tonnes of ore annually from the mine to Esperance.
The Port Authority was considering dredging the harbour to accommodate 60,000 tonne vessels which would make use of the new high capacity ore-loading facility which was under construction.
Other projects which would benefit from the rail link were:
· Western Mining Corporations' expansion of its nickel concentrate operations at Leinster and development of its deposit at Mount Keith;
· it would put dominion Mining in a better position when it decided to develop the nickel deposit at Yakabindi;
· Shell's fuel haulage operations for various base metal projects.
Mr Taylor said the upgrading was particularly timely as it would create job opportunities for railway people at a time when then was concern over a drop-off in the number of railway employees in the Goldfields as a result of the new National Rail Corporation.
"In Esperance where the amount of bulk cargo handled will literally treble, the Port Authority is expected to double the size of its workforce from 16 to 32," he said.
"But just as important is the effect the 1.5 million tonne bulk handling contract and upgraded rail link will have on the economics of shipping through Esperance.
"The Authority is estimating that, with the extra throughput its new bulk loader will enjoy, handling charges could drop from $5 a tonne to less than a dollar.
"Suddenly, shipping out of Esperance is going to become very attractive and the economics of mining ventures like nickel up and down the northern arm of the Goldfields could change substantially."
The rail project would employ 25 people, and when in operation, would create jobs for 36 enginemen.
The Koolyanobbing mine, which closed in 1983, would employ 120 people in the construction stage and provide on-going work for 66 employees and extra work for contractors and service personnel.
"That in itself is going to be a boon to the nearby town of Southern Cross, but equally we should see some improvement in Norseman where extra rail crews will be stationed to handle the new freight trains," Mr Taylor said.
"The State itself is going to benefit by the equivalent of about $2 million a year in mining royalty payments and every town affected is going to see more fuller use of services and infrastructure," he said.
"The railway's upgrading shows that real microeconomic reform and a commitment to providing the necessary infrastructure for industry does bring about efficiencies that can lead to the creation of new jobs."
Mr Taylor said the upgrading also showed how the State and Federal Governments could work together to kick-start the economy.
"Critics of Government expenditure on job-creating programs fail to realise that these programs can have lasting benefits for the regional economy," he said.
"The Goldfields in particular relies on efficient and competitive transport systems and in this regard the railway upgrading is a solid investment for the future."
Mr Taylor said he would ask the Goldfields-Esperance Development Authority to begin a study into ways of maximising the use of Esperance Port and the rail network by local resources companies and businesses.
"I envisage the study will involve close liaison with the companies in the Goldfields, mining industry suppliers, the Port Authority and Westrail," he said.