Australia is one of the leading producers of minerals, worldwide, with over 400 mines producing 19 minerals. All of the Australian states, Christmas Island, and the Northern territories produces minerals. However, there is no mining in the Australian Capital Territory, although they do have quarries for mining construction materials, like aggregate.
Minerals accounted for 10 percent of Australia’s gross domestic product (GDP) in 2012-2013, making it an important part of the country’s economy. According to the Australian Bureau of Statistics, the mining industry employed 260,000 people directly as of June 2012.
According to the Bureau of Resources and Energy Economics (BREE), the mineral industry, excluding gas and oil, exports are estimated to be worth $107 billion in 2012-2013, which makes it one of Australia’s largest exports. Minerals account for about 71 percent of merchandise exports and 59 percent of good and services exports. Mining companies trade on a global scale, exporting goods worldwide, with the principal markets being Japan, India, South Korea and China.
Australia has the world’s largest resources of certain minerals. It has the world’s largest resources of uranium, zircon, iron ore, zinc, rutile, nickel, lead and gold and the second largest in niobium, tantalum, ilmenite, silver, thorium, cobalt, copper and bauxite. Australia is ranked in the top five of the world for its resources in rare earth, brown coal, lithium, vanadium, manganese ore, magnesite, black coal, and tungsten.
Production and Resources
Every year, Geoscience Australia creates a report on the national inventory of minerals. The report compiles information from publically released documents from Australia’s Mineral Resource Assessment and Australia’s Identified Mineral Resources. Along with the report, a national scale map is released showing endowments and mineral deposits, by region, for a number of mineral commodities.
Australia’s Mineral Resource Assessment was compiled by Geoscience Australia and the Bureau of Resources and Energy Economics. This report contained information on mineral exploration, identification of mineral resources, new mining projects, and mineral production.
Australia’s Identified Mineral Resources provides estimates of Australia’s mineral resources for all major and some minor commodities. This report is based on published company reports of mineral resources and oil reserves. This report seeks to provide a long-term view of the mining industry. The figures in this report are generated by the Bureau of Resources and Energy Economics and compiled by Geoscience Australia.
Bureau of Resources and Energy Economics reports each quarter on mineral productions and exports in the Resources and Energy Quarterly. This report also contains an outlook for consumption, trade and supply and commodity prices.
Many of the minerals produced are essential to modern lifestyles and have various applications. For example, coal can be used to generate electricity, but it also needed to produce steel. Mineral ores are needed to produce many metals and mineral products, including iron ore. Iron ore is used to produce steel which can then be used to create ships, machinery, motor vehicles or in construction projects. Bauxite is used to make aluminum. Copper is needed for electrical wiring, plumbing and in the creations of various alloys. Nickel is used for stainless steel. Many of the metals and minerals produced in Australia are used to create many of the items that you use in your everyday life. That is one reason the Australian mineral resources are essential to the international mineral commodities market.
There is a standard sequence used to extract minerals. It starts with the exploration of an area using geophysical, geochemical and/or geological tools. The area is then drilled in order to find and evaluate mineralization. If the area looks promising, more detailed testing is done to estimate the quantity and size of the mineral resource.
A pre-feasibility study is performed in order to assess the economic potential of the resource. All testing, evaluations, and studies must be complete before moving to the next step. If any of these findings are not favorable, it is unlikely that a mining project will begin, and exploration will begin again.
If the study if favorable, a feasibility study is undertaken to assess the resource’s commercial viability. This might include mine planning so that the commercially recoverable part of the deposit can be evaluated. This includes the value and market potential of the ore, the metallurgy, the cost of financing, mine closure and rehabilitation and the cost of mine development which includes mine milling, the recovery of the ore and infrastructure.
If the feasibility study is not favorable, then the project will not proceed. Though this is a long process it is necessary in order to ensure that the minerals being mined are commercially viable. Since mining is such as important part of the Australian economy, the process of determining when and where to start a new mining project is essential. A favorable feasibility is the first step in creating a new mining project.
Japan, India, South Korea and China are the biggest importer of Australian minerals. The European Union is one of the largest consumers of non-ferrous metals. Generally, Australian coal and iron ore are traded between suppliers and consumers, based on contracted prices which are negotiated quarterly using various benchmarks.
International trade is important to the Australian mineral industry since a large percentage of its resources are exported. With over $107 billion in exports, in 2012-2013, it’s important for the Australian mining industry to maintain a good relationship with their international trading partners, while developing new relationships with other international commodity markets.