Malcolm Roberts (Queensland, Pauline Hanson's One Nation Party) Share this | Link to this | Hansard source

I move:

That the following matter be referred to the Rural and Regional Affairs and Transport References Committee for inquiry and report by the first sitting day of 2023:

The project known as the Iron Boomerang, with particular reference to:

(a) the employment likely to result from the project during construction and once completed;

(b) the effect on Australia's gross domestic product and balance of payments from this significant change in Australia's productive capacity;

(c) capital, energy and resources required to build and operate the proposed 10 steel plants, 5 at Port Headland, Western Australia and 5 in the Bowen Basin, Queensland;

(d) the feasibility of the proposed clamshell design and electric/diesel propulsion to safely transport iron ore and coal across the 3000 kilometre route;

(e) the environmental benefit of the reduction in bulk ore exports in regard to marine pollution and energy consumption;

(f) any environmental impacts from the proposed alignment;

(g) any impacts of the rail line or steel parks on the Aboriginal community;

(h) the relevance of the Iron Boomerang project to our national security; and

(i) any other related matters.

As a servant to the people of Queensland and Australia, I say that Project Iron Boomerang is an exciting and visionary project that can make our country's north and can make our whole country. Project Iron Boomerang's main elements are a 3,300-kilometre transcontinental railroad with heavy duty axle capacity connecting existing rail networks in the iron ore region of the Pilbara to the existing rail networks in Central Queensland, on the way linking with the existing Darwin-Adelaide rail line to improve freight movement nationally.

The essence of this project is that iron ore will be transported from west to east, and those carriages will be then backloaded with coal to transport coal to Western Australia—hence the boomerang name. Steel blast furnaces and steel parks at both ends—in the east in the Bowen Basin of Queensland and in the west in the Pilbara in Western Australia—will in turn turn the iron ore and coal into steel slabs for export from Port Hedland in Western Australia and from Abbot Point and the Port of Gladstone and Queensland. Fibre optic, water, power and potentially gas lines can be laid along the rail alignment for additional commercial benefit.

Project Iron Boomerang will strengthen Australia's balance of payments. It will lift our gross domestic product, and, with that, lift our whole economy, restoring our national security, restoring opportunity. We have allowed too many industries to be closed and sent overseas. Too many jobs have been exported. It's time to turn that around. Project Iron Boomerang is not unique. The 1,440-kilometre Tarcoola-Darwin railway was completed only recently in five years at a cost of $1.2 billion across similar terrain, so we know we can do it. The total Adelaide-Darwin line is 2,975 kilometres. We can do this. Iron Boomerang is feasible and well within our grasp.

At the very least, the project will create a freight and passenger line that will open the Top End and improve services to remote regions. The alignment will be used to lay fibre optic cable and a power line. These services would ordinarily accompany a railway having this line's economic and security implications. Remote communities and often disadvantaged Aboriginal communities will benefit enormously from access to high-speed, reliable internet, reliable power, transport and permanent jobs. Imagine the transformation of inland northern Australia.

There is a strong case for adding a water pipeline along the alignment to add potable water to the services that Project Iron Boomerang will offer remote communities. Lake Argyle in Western Australia is part of the Ord River Irrigation Scheme. At 5,600 gigalitres, it is mainland Australia's largest dam. The Ord River irrigation network extends close to the start of Project Iron Boomerang. A connection could be made to bring potable water, which is town, stock and station water, to remote communities.

For too many years successive government have offered remote communities nothing except platitudes and paternalism whilst housing and services get worse and worse. Project Iron Boomerang offers a chance to change that future to bring prosperity to Aboriginal communities, Australian communities, northern Australia communities.

The private sector, anxious to access cost-effective, reliable transcontinental and intercontinental freight and internet services, will meet much of the cost. Telcos are now showing a lot of interest in the fibre-optic cable. The steel parks at either end are a large part of why Australia should move this project forward. In 2020 the world's largest steel manufacturer, China, produced one billion tonnes of steel—1,066 million, to be precise. By contrast, Australia's two largest manufacturers, Liberty and BlueScope, produced just 12.7 million tonnes between them—one per cent of China's production. And by the way, the Chinese get their iron ore and their coal raw materials from Australia. Despite accounting for less than one per cent of world production, the Australian steel industry employs 100,000 Australians and adds $29 billion to our gross domestic product.

Australia should be a leading manufacturer of steel. We hold the world's third largest reserves of metallurgical black coal and the largest reserves of high-quality iron ore. Yet we mostly export the stuff: $145 billion worth of iron ore and $100 billion of coal, creating jobs overseas instead of here in Australia. The growth of underlying world steel demand is expected to remain at two per cent over the medium term, with the new developing region of India, Bangladesh and Pakistan taking up the slack from maturing Chinese, American and European markets. If exports of coal for power are cut in the name of climate change—which One Nation strongly opposes—then substituting the use of coal for power with the use of coal for domestic steel will provide continuity of employment for the coal industry. Even Adam Bandt has at last woken up to the fact that we need coal for making steel, so it's okay to burn coal now—something that should keep the unions and the coalminers happy.

Steel is critical to the new economy, being an essential component of wind turbines and electric vehicles, amongst many other uses. Another economic benefit is fly ash, which is a by-product of steel manufacturing when the power source is coal. Fly ash can replace 20 to 30 per cent of the cement in concrete. Project Iron Boomerang will result in the construction of new concrete plants to utilise the steel park's by-products. This will provide more employment and of course produce more concrete to secure the foundations of all those wind turbines that the Greens want to build and the dam walls that One Nation wants to build.

There are significant economic and environmental efficiencies from replacing the export of coal and iron ore with the export of steel slabs—much higher value. Australia currently exports 950 million tonnes of iron ore, including 350 million tons of dirt, and 177 million tonnes of metallurgical coal for steel and 213 million tonnes of thermal coal for power generation, freeing the world's poor, who haven't got electricity in some cases. This is shipped, trucked and railed around the world. Then those transports return home empty. Project Iron Boomerang will eliminate that overhead from the price of steel and eliminate all the wasted energy in that supply chain. That gives Australia an enormous competitive advantage in the steel sector. Australian steel slabs will be sent overseas as backloaded cargo for container ships that are currently leaving Australia empty—more advantage to all importers and exporters from our country.

It's likely—and this is one of many claims for the committee to test—that these new steel parks will be able to produce quality Australian steel 15 per cent more cheaply than Chinese steel and of far higher quality. It's safe to say that the project, with the support industries that will grow around the steel parks, will produce an economic benefit in the hundreds of billions of dollars. The world steel market is worth $1.3 trillion. There's no reason Australia can't dominate that market, and with this project it will. Around 40,000 new breadwinner jobs will be created directly and, indirectly, double that—or possibly much more.

Project Iron Boomerang was granted the status of project of state significance in Queensland in 2006, yet this appears to have lapsed, partly through the need to coordinate three states on the project. This is where the federal government is much better suited to advance the project. One Nation are proposing a committee referral with a view to recommending for or against the listing of Project Iron Boomerang as an Infrastructure Australia high priority project. The next step will be a full business case, and that has a price tag of $240 million. Government must fund this before private equity can have the confidence to put billions of their own money into it. We have nobody but ourselves to blame for the difficulty this project has had in getting capital to complete a detailed business case. It's no surprise private industry are in effect saying to the government, 'We don't trust you.'

Once the federal government provides surety, it's likely that private equity will fund the major project elements. The railroad itself is costed at $20 billion, the steel parks at around $40 billion and the supporting infrastructure at another $10 billion. Increased government revenue of $25 billion annually is likely for each $100 billion of additional domestic economic activity. One Nation does have a concern that the funding model will result in a high degree of foreign ownership. This is something the committee can discuss. While we recognise that steel customers may want to secure steel supply through joint ventures, One Nation wants Australian control through ownership. The work done so far on the business case proves the need to get serious about Project Iron Boomerang. I ask you for your support for this motion.

Glenn Sterle (WA, Australian Labor Party) Share this | Link to this | Hansard source

I just want to take a couple of minutes to support and thank Senator Roberts for bringing this to my attention. I hadn't heard of Project Iron Boomerang, but I sat down and got a briefing from Senator Roberts. It comes back to when I was a kid growing up. I remember in the great state of New South Wales we used to do all of this sort of stuff. We actually used to make our own steel. We used to have proud steel cities, where there were communities, there were bonds and there were families, before all this 'fly-in, fly-out' nonsense took over. It was before the farm was sold—if I can use the terminology of a farm. It breaks my heart to think, as I'm watching my grandchildren grow up, how disgusted they should be with the politicians before us who thought it was a good idea to contract out work we used to do and we did well. I hear conversations like those I've picked up in Senate inquiries on the Inland Rail, where there are concerns about cheaper steel coming from China, nowhere near the Australian standard. Regardless of who's in government, I always have a fear: Who are the ones who are supposed to be out there monitoring this stuff? Are they doing their job properly? That's not a blue-versus-red conversation or blue-versus-red argument. I nearly said blue-versus-blue, but you know what I mean.

So I want to support this. I know the Labor Party and Prime Minister Albanese—the Albanese government—support you, Senator Roberts, for bringing this to us. I think it's a magnificent thing, and I also think this is what we should be doing. These are the big-ticket items that, when I first came into the Senate, lo and behold, I thought we would be discussing on a daily basis. How tricked I got! But, anyway, at least let's get back to the big stuff about building a better nation, as I said in my first speech, and leaving it better than how we found it.

I want to share a quick comment with the Senate. I was in China. I met with Madam Fu Ying. Some may think, 'Who's Madam Fu Ying?' Madam Fu Ying is very highly regarded in the CCP. She was China's Ambassador to Australia during the Howard regime. I was joined by Senators Gallagher and Dastyari when Madam Fu Ying made it very clear to us how wonderful it is: 'Thank you, Australia, for sending us your coal. Thank you, Australia, for sending us your iron ore, because we turn it into steel, and we make a heck of a lot more money selling it back to you, and we appreciate that.'

I want to support this, and we will support this, Senator Roberts. I understand the opposition are, hopefully, getting behind this too, because this is the stuff we need to do. The beauty of speaking after Senator Roberts is you've heard the whole guts and crux of the matter. I can't pick an argument there. There's not a downside that I've seen. The beauty of it is that I know my committee—the Rural and Regional Affairs and Transport Committee—has been predicated for all of the years I've been here to put aside all the political bulldust, to actually dig deep, go wide, go varied and listen to everyone who has got a thought and to actually try and deliver in the best interests of our nation.

Senator Roberts, I tip my hat to you. I look forward to joining you on the tour. Let's try and put these two great industries together: iron ore in my state of WA and coal in your state of Queensland. It just makes too much sense. I'm starting to get a headache because it's sounding too easy.

Jess Walsh (Victoria, Australian Labor Party) Share this | Link to this | Hansard source

The question is that the motion moved by Senator Roberts be agreed to.

Question agreed to.