Pilbara miners choose locally manufactured content

Rio Tinto and Fortescue Metals Group's decision to commit to local WA suppliers provided more than $1.8 billion of work to the region.

It comes as part of the Australian Government's push to include greater levels of locally made goods and services on mine sites.

Despite previously voicing concerns about creating local content tariff regulations for the mining industry, the Western Australian Government has thrown its support behind the move for set local content initiatives.

At the time of the local content announcement prime minister Julia Gillard said mining companies would lose lucrative tariff concessions unless they can prove local suppliers have been given every chance to compete with foreign imports.

The tougher mining regulations forced companies with projects worth more than $2 billion to publish a list of their requirements on a public website.

WA commerce minister Simon O'Brien said since its implementation Fortescue has reported 96% local content on construction and services at its Chichester expansion, while Rio had an aggregate local content figure of around 85% at its range of Pilbara iron ore projects.

Local procurement covered project requirements including processing equipment; transport; infrastructure; storage facilities; engineering and design; and power generation.

O’Brien said this was a great result for local suppliers, particularly in a period of volatile iron ore spot prices.
“This result demonstrates local supply continues to be an attractive option for the mining industry, despite strong competitive pressures from overseas,” he said.

“It also illustrates the continuing role the iron ore sector is playing in stimulating growth and employment across WA’s economy.  As part of the State Government’s approach to local industry participation, I am encouraging iron ore project proponents to work closely with the Government and suppliers to identify areas of future opportunity."

The Government is supporting small to medium manufacturers and companies in the regions through the Industry Facilitation and Support Program.