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PACE Supply Chain Development Program
IDENTIFY Brief – 9 February 2016
www.statedevelopment.sa.gov.au
Paul GoiakDirector, Industry Development
www.statedevelopment.sa.gov.au
DisclaimerThe information contained in this presentation has been compiled by the Department of State Development and originates from a variety of sources. Although all reasonable care has been taken in the preparation and compilation of the information, it has been provided in good faith for general information only and does not purport to be a professional advice. No warranty, express or implied, is given as to the completeness, correctness, accuracy, reliability or currency of the materials.
The Department of State Development and the Crown in the right of the State of South Australia does not accept responsibility for and will not be held liable to any recipient of the information for any loss or damage however caused (including negligence) which may be directly or indirectly suffered as a consequence of use of these materials. The Department of State Development reserves the right to update, amend or supplement the information from time to time at its discretion.
Background
3Department of State Development
Paul GoiakDirector, Industry DevelopmentDepartment of State Development
Supply Chain Development: Minerals, Energy, Information and Communication Technologies (ICT), Defence (Defence SA)
Administration of economic development programs aimed at growing South Australian supply chain capability and capacity
Sector Experience: Automotive, Ophthalmics (lens manufacture), Uranium Mining, ICT Wholesale Distribution, Public Service
What will be covered
4Department of State Development
• Why are METS so important?
• Success drivers (and constraints) for METS companies.
• Role of Government
• Where is the opportunity for growth?
• Why the PACE Supply Chain Development Program?
METS supply a very wide range of services
What are METS?Mining Equipment Technology and Services
5Department of State Development
Exploration Development/Operation Decommission/ RehabilitateFeasibility & Approvals
Information Communications Technology (ICT)Geophysical SurveysDrilling
Equipment manufactureMetal fabricationCivil ContractingAutomation/ ControlOil & Gas well servicesAccommodation campsMaintenanceWater treatmentLogistics & support
Environmental servicesRemoval of facilitiesLand Rehabilitation
Front End Engineering DesignProfessional services eg Land Access, Asset Evaluation
Typi
cal
activ
ities
6Department of State Development
Activity Examples of SA CompaniesInformation Communications Technology (ICT)
Maptek, SRAAPC Technology, Codan/Minelab, Speedcast
Environmental Services Coffey, Golder, Parsons Brinckerhoff, URS, Water Data Services, Cooe, Australian Groundwater Technologies
Professional services GPA, Fyfe, Jacobs, WorleyParsons, GHD, Aurecon, Exact Mining, Kempe Engineering
Specialised equipment (mining)
Specialised equipment (petroleum)
Liebherr, CavpowerThermo Fisher, Scantech
X Drilling, Gearhart, Transco
Automation Sage, Logicamms, Atsys
METS in South Australia
7Department of State Development
Activity Examples of SA CompaniesOil & Gas - Drilling & Completion Saxon Energy, Baker Hughes, Ensign, Condor, Farley Riggs
Water Osmoflo, Century Products, Veolia, Hydrus Technology, Baleen FiltersBasetec, RPC Pipe
Metal fabrication Ahrens, Manuel, Samaras, SA Structural,Ottoway Fabrication/Ottoway Engineering, Pipetech, Smart Fabrication
Civil Contracting Exact Mining, Lucas TCS, Bardrill
Electrical Cowell Electric, RJE, Mayfield, Nilsen
Accommodation camps (manufacture & camp services)
KJM, Ausco, Australian Portable Camps
METS in South Australia
METS State and National objectives
8
Oil, gas and energy resources
Mining, equipment, technology and services
Medical technologies and pharmaceuticals
Food and agribusiness
Advanced manufacturing
Industry Growth Sectors
METS are a priority for State and Federal governments
South Australia’s share of Australia’s key mineral resources
Department of State Development
METS supply a very wide range of services
Why grow the METS sector?
10Department of State Development
• Diverse nature of METS will grow economic complexity of SA
• Technology driven sector – long term jobs
• Global growth will continue to drive demand
• Global market – jobs/capabilities remain after primary commodity exhausted
• Complementary to our comparative advantage – Oil & Gas, Copper, Uranium, Graphite, Iron Ore
METS
METS in South Australia (more significant than previously thought)
Gross sales $3.9B
Total Employment1 17,830 FTE
GSP contribution1 $2.4B (2.6%)
Revenue/employee = $220,000
Source: Econsearch METS analysis, 2012/13 input/output tables1 Tier 1 and Tier 2
National average METS contribution to GDP 4.7%
MINERALS & PETROLEUM
Gross sales $6.2B
Total Employment2 15,800 FTE
GSP contribution3 $3.3B (3.7 %)
Sources: Gross Sales, DSDABS 5220.0 and Data Cube2 Direct only3 exclude taxes, royalties and subsidies.
How do we grow?Successful METS do their homework
12Department of State Development
Globally competitive
Connect and build relationships
Understand the Issues
Provide innovative solutionsGrowth
Are there constraints ?
13Department of State Development
Source: 2015 Austmine National Survey
SA/NT not leveraging international opportunities like other States
Base: Total Sample (n=432)Q23. Does your company export equipment, products, services or technology to other countries?
Companies Currently Exporting:by State, 2015
Total NSW & ACT WA VIC & TAS QLD SA & NT0%
20%
40%
60%
80%
100%
66% 64%74%
66%82%
36%
Top Growth Opportunities:by State, 2015 (selected)
Growth Opportunity
Total QLD SA & NT
International / Export
42% 58% 20%
Industry Collaboration / Partnership
17% 10% 26%
What is the role of government?
14Department of State Development Source: A Scorecard for Growing South Australian METS, 2015
• Provide a compelling set of programs for encouraging increased investment
• Expose local mining services companies to global supply chains as a measure to build relationships
• Provide an environment where technology can be integrated from universities and the ICT sector into the mining services sector
What is the government doing?
15Department of State Development
•Connect and build relationships•Understand the Issues
PACE Supply Chain
Development Program
• Provide innovative solutions
Mining & Petroleum
Services Centre of Excellence Globally
competitive
Where are the opportunities?
16Department of State Development
Tapping external markets is the key to growth
SA Australia Global0
50
100
150
200
250
300
Development Phase Minerals ProjectsCapital Cost US$Billion
Feasibility Stage Projects
Committed Projects
257
7
92
Source: BREE April 2015; SNL Metals and Mining July 2015
Where are the opportunities?
17Department of State Development
Source: A Scorecard for Growing South Australian METS, 2015
1989
-90
1991
-92
1993
-94
1995
-96
1997
-98
1999
-00
2001
-02
2003
-04
2005
-06
2007
-08
2009
-10
2011
-12
2013
-14
0
50
100
150
200
250
Labour Pro-ductiv-ity
Capital pro-ductiv-ity
Mining Industry Multifactor Productivity, AustraliaIndex 2013-14 = 100
Productivity Growth 2014-15, By Industries, Australia Hours worked basis
Average
Arts and recreation
Professional & technical
Transport & warehousing
Administrative
ConstructionRetail trade
ManufacturingRental, hiring & real estate
Wholesale trade
Agriculture, forestry & fishingAccommodation & food
Utilities
Other services
Financial & insurance services
Media & telecommunicationsMining
-10 -5 0 5 10 15 20 25
LP2 MFP2
• Develop relationships, understand value drivers
• Transition companies from other sectors into the resources sector
• Delivered by industry experts
• Supported by the State Government
Why the PACE Supply Chain Development Program?
18Department of State Development
19Department of State Development
What’s in the PACE Program?
► Stage 1 – Identifyincreasing market intelligence and awareness
► Stage 2 – Developdeveloping sales and marketing capabilities
► Stage 3 – Extend
preparing companies for export market opportunities
Final word - The world is investing in METS …
20Department of State Development
TSX, the primary stock exchange globally for exploration companies and junior miners, is transferring its capital raising to the Technology and Innovation space which:
• is the fastest-growing sector on TSX/TSXV since the start of 2013
• is now collectively valued at over $250 billion • has raised nearly $12 billion in equity capital since the start of 2014
For more key facts visit http://www.bctia.org/Blog/2015/7/3/Canadas-Thriving-Tech-Sector
21Department of State Development
… are you on board?
Thank you
www.statedevelopment.sa.gov.au
PAUL GOIAKDirector, Industry DevelopmentT: 08 8303 [email protected]