Stayover Chinchilla Need and Demand Assessment Need... · 2016. 9. 28. · Stayover Chinchilla – Need and Demand Assessment 3 Stayover Chinchilla b. The guarantee of a certain number

Stayover Chinchilla

Need and Demand Assessment

Prepared for Ausco Modular

January 2016

Stayover Chinchilla – Need and Demand Assessment

i Table of Contents

TABLE OF CONTENTS

TABLE OF CONTENTS ...................................................................................................................................... i

INTRODUCTION ............................................................................................................................................. ii

1 STAYOVER CHINCHILLA ......................................................................................................................... 1

2 PLANNING FRAMEWORK ...................................................................................................................... 5

3 MAJOR PROJECTS ................................................................................................................................ 11

4 PROJECTED WORKER NUMBERS ......................................................................................................... 23

5 NON‐RESIDENT WORKER ACCOMMODATION .................................................................................... 28

6 BENEFITS OF STAYOVER CHINCHILLA .................................................................................................. 36

7 CONCLUSIONS ..................................................................................................................................... 41


ii Introduction

INTRODUCTION

This report presents an independent assessment of the need and demand for the continuing

operation of the Stayover Chinchilla workers accommodation facility. The Stayover facility

on Zeller Street (Stayover Chinchilla) at Chinchilla is a non‐resident (workers)

accommodation village of 1,000 rooms, which has been in operation since approximately

2008.

This report reviews the need and demand for Stayover Chinchilla, including specifically the

role it has played in the Chinchilla economy over the past five years and the link between

the Ausco facility and the hotels/motels within town.

This report is presented in a number of sections including:

Section One reviews the existing facility.

Section Two provides a review of the planning environment.

Section Three details major projects which would result in demand for non‐resident

(workers) accommodation.

Section Four presents estimates of projected worker numbers throughout the

Chinchilla region.

Section Five reviews non‐resident worker accommodation within the Chinchilla area.

Section Six outlines the benefits of Stayover Chinchilla.

Section Seven details the conclusions of the need and demand for the continued

operation of Stayover Chinchilla.


1 Stayover Chinchilla

1 STAYOVER CHINCHILLA

1.1 The Stayover by Ausco facility on Zeller Street (Stayover Chinchilla) at Chinchilla

is a non‐resident (workers) accommodation village of 1,000 rooms which has

been approved since 2000 and in operation shortly after. The current

development has been in operation since approximately 2008. There has been a

recent amendment to the development approval in place for a 100 room

expansion known as Stage 6. It is not intended to be effected.

1.2 The Village has been designed to provide convenient, comfortable and serviced

accommodation for workers of the mining and resource companies operating in

the region.

1.3 The original facility was approved as part of non‐resident accommodation for the

Kogan Creek Power Project and will still service maintenance crews for that

Power Station. In more recent years, the facility has been an essential element of

supply in non‐resident accommodation for workers associated with the

Queensland Gas Corporation (QGC) coal seam gas project, APLNG Project and

the Arrow Energy Project.

1.4 Chart 1.1 illustrates the number of rooms at the Stayover Chinchilla facility and

occupancy rates. The key information includes:

a. The number of rooms (on the left hand axis) that have been operational at

the site, increasing from 148 in 2010 to 1,000 rooms in more recent times.

The most substantial increase in rooms happened progressively over a two

year period from March 2011 through to March 2013.

b. The occupancy rate, illustrated in red, which included the number of rooms

occupied during any one night. This indicates varying rates between 30% ‐

85% over the past five years, with substantial demand peaking from

November 2011/January 2012 until recently, in line with the construction of

infrastructure for the QGC project as the ‘workfront’ moved through the local

area.



c. The total usage of facilities at the site includes rooms held for specific

contractors/firms but not necessarily occupied on any one night. This

indicates a provision of close to 100% usage over the project until late 2014.

1.5 Overall, the Stayover Chinchilla facility has been an essential element in

accommodating the workforce in the Chinchilla region historically and more

recently as part of the coal seam gas project. For example, this has resulted in

long term contracts with QGC for 400 – 500 workers a night at times, an essential

element of demand over the course of this period.

CHART 1.1 – STAYOVER CHINCHILLA ROOMS AND OCCUPANCY

1.6 The attraction of Stayover Chinchilla to large companies undertaking projects

within the Chinchilla region is reflective of a number of factors including:

a. Workers are accommodated in bulk workforce locations and able to be

bussed to and from facilities, reducing travel times and impacts on local

infrastructure.

0%

20%

40%

60%

80%

100%

120%

0

200

400

600

800

1000

1200

Rooms (LHS) Occupancy (RHS) Total Usage (RHS)



b. The guarantee of a certain number of rooms which would always be available

for the company, to accommodate its workforce flexibly.

c. The workforce is ‘supervised’ with regard to their behaviour and impacts on

the local community.

d. A dining hall is provided, catering for all dietary needs and ensuring a healthy

diet for the workers, and relieving workers of the need to find the time and

have the skills and energy to provide food for themselves after long shift

work.

e. Modern villages such as Stayover Chinchilla provide an enhanced level of

amenity including gymnasium, BBQ facilities, landscaping, entertainment

facilities such as cinema rooms, computer/Wi‐Fi services, billiard room, duty

manager and on‐site security and the like.

f. Ease of connections to town (provided by village or others).

g. Specialised facilities such as first aid centre, training room, ice rooms, alcohol

monitoring devices and the like.

h. Substantial laundry facilities as part of cleaning requirements for miners.

i. The operator is responsible for compliance with corporate requirements

relating to elements such as HS&E (audits, reporting, microbiological testing

of food, etc), governance, local content reporting, consolidated invoicing, etc.

1.7 Reflecting the role of the facility as a non‐resident worker village, most users

locate at the site for periods of 2 – 3 weeks while they work a shift of three

weeks on, one week off. Whilst the duration of the overall stay varies by

individual, it is estimated to be an average of 9 – 12 months. The village has a

strict resident code of conduct as well as safety induction as part of the check‐in

procedure to the facility.



1.8 Overall, Stayover Chinchilla has played an important role in the development of

major projects within the Chinchilla region and can continue to play that role into

the future as discussed in the remainder of this report.


5 Planning Environment

2 PLANNING FRAMEWORK

2.1 This section outlines the key principles and policies relating to the Chinchilla

Shire Planning Scheme in operation as well as the Western Downs Planning

Scheme currently in draft. This section is not intended to be a detailed review of

planning considerations, but rather the strategic context of relevance to the

assessment of economic need.

Darling Downs Regional Plan

2.2 The Department of State Development, Infrastructure and Planning released the

Darling Downs Regional Plan in October 2013. The purpose of the plan was to

identify the state’s interest in land use planning for the region and to address the

emerging regional issues of land use competition between the agricultural and

resources sectors. The plan covers the area from Toowoomba/Southern Downs

Regional Council in the east through to Maranoa/Balonne to the west.

2.3 At page 20 of the plan under the heading Providing Certainty for the Future of

Towns, the following is stated:

“Population growth presents both opportunities and challenges for the

region. Local Governments can assist communities to adapt to population

growth by, for example, providing an adequate supply of serviceable land to

accommodate anticipated needs of the required scale and type for residential,

retail, commercial and industrial land uses. This includes providing an

adequate supply of land for non‐resident workforce accommodation, if there

are large approved projects directly associated with mining, major industry,

major infrastructure or rural uses that require non‐resident workers to stay

for extended periods.”

Chinchilla Planning Scheme

2.4 Part 3 of the Chinchilla Planning Scheme titled Strategic Direction at Section 3

details various information. At Section 3.2 titled Economic Development, the

following is stated:



“The economy of Chinchilla Shire is enhanced and diversified through

sustainable use of natural resources (including soil, extractive and mineral

resources) and through a diverse range of other economic activities that

respect the hierarchy of the urban centre and the small towns:

‐ The Planning Scheme reinforces and consolidates the role of Chinchilla as

a principal place for business, industry and commerce within the Shire.

‐ The local service roles of the towns of Brigalow and Kogan are protected

and enhanced.

‐ Productive rural land (such as the Condamine floodplains), rural industries

and natural features (including mineral and extractive resources) are

protected to reflect and enhance their continued economic viability.

‐ The industrial areas in Chinchilla are consolidated and protected to

ensure their role as a key area for economic activity is reinforced.”

2.5 The Chinchilla Planning Scheme, therefore, recognises the importance of natural

resources to the growth of the town. Facilities such as non‐resident workforce

accommodation are essential to this ongoing growth.

Western Downs Planning Scheme Draft

2.6 A draft Planning Scheme was prepared by Western Downs Regional Council,

which is still subject to a final state interest check. In Section 3.2 of the Draft

Western Downs Planning Scheme at 3.2.1.1 Regional, Local and Historical

Overview sub‐point 6, the following is stated:

“. Chinchilla is the service hub for surrounding rural activity, satellite

communities and resource sector settlements. It is also emerging as the

accommodation focus for resource sector activity in the district. The town is

centred on Heeney Street, a tree‐lined boulevard bustling with retail activity

and cafes, a main street which also supports the major cultural event in the

Western Downs, the Biennial Chinchilla Melon Festival.



2.7 At Sub‐paragraph 10, the following is stated:

“The Western Downs represents a significant proportion of the Surat Basin, a

rich energy province extending from Central Southern Queensland to Central

Northern New South Wales including the Western Downs, Maranoa and

Toowoomba Regional Council areas. With significant proven reserves of

thermal coal and coal seam gas located in the Surat Basin, the Western

Downs is set to undergo a significant degree of change and growth. The

changes will not only impact on the economy in the region, but will also have

impacts on growth management, including infrastructure provision,

environmental protection and the retention of the lifestyle so valued by the

existing community. The coal seam gas industry is not a long term extractive

industry operation and therefore a balance must be achieved in growth

management between short and long term land use impacts.”

2.8 Further at Section 3.2.2 Opportunities and Challenges under the heading of

3.2.2.1 Housing Need sub‐paragraph 4, the following is stated:

“There is an identified shortfall in non‐resident workforce accommodation in

Western Downs. Fly‐in/fly‐out (FIFO) and drive‐in/drive‐out (DIDO) demand is

often not met by mining and petroleum mining lease camps or current

accommodation providers.”

2.9 Further at 3.2.2.2 entitled Managing the Growth of the Resources and Energy

Sector, it is identified the following:

(2). Mineral, gas and extractive industry activities have the potential to

positively and negatively impact triple bottom line, including potential:

‐ Negative environmental impacts, arising from vegetation clearing,

salinity, loss of arable land, ground water and surface water

disturbance and loss of air quality through articulate emissions;



‐ Positive and negative economic impacts arising from housing price

fluctuation, growth in an emergence of complementary industries and

services, social and physical infrastructure demands;

‐ Positive and negative social impacts including increased employment

opportunities, shifts and sectorial employment, housing shortages,

social instability, lifestyle, health and amenity impacts, and loss of

generational farming communities;

(3). The likely impacts of the rapidly expanding resources sector on the

Western Downs are highly dependent on the location, magnitude and

operation of individual mining and petroleum projects.

Notwithstanding, the flow‐on effects of this sector are likely to result in

demand spikes in non‐resident workforce accommodation, supporting

services, including industry, retail and commercial activities.

(4). Whilst the growth of the resources sector provides a significant

opportunity to diversify the economic base of the Western Downs, it is

necessary to ensure the traditional rural industries which underpin the

cultural identity of the region are protected.

(5). Population growth, including the influx of non‐resident workers

associated with the mining and resources sectors, is likely to impact on

the physical and social fabric of Western Downs. It is important to

ensure that individual settlements are maintained as strong and

resilient communities which can adapt positively to the future

opportunities and challenges.”

2.10 Section 3.3.4 entitled Element – Housing and Affordable Living specifically

recognises at sub‐point 3.3.4.1(2) that non‐resident workforce accommodation

locates within urban centres.



2.11 Overall, the draft Planning Scheme recognises non‐resident worker

accommodation as an essential part of the urban environment and essential to

the growth of the region.

2.12 In the definitions section of the Draft Town Plan, non‐resident workforce

accommodation is specifically described as:

“premises used to provide accommodation for non‐resident workers.”

2.13 This is specifically different to the definition of short term accommodation which

is described as:

“premises used to provide short term accommodation for tourists or travellers

for a temporary period of time (typically not exceeding three consecutive

months) and may be self contained. Examples include:

‐ Motel

‐ Backpackers

‐ Cabins

‐ Serviced apartments

‐ Accommodation hotel

‐ Nature based tourism

‐ Farm stay

‐ Resort complex”

2.14 It is also different to the term entitled “relocatable home park” which is

described as:

“premises used for relocatable dwellings (whether they are permanently

located or not) that provide long term residential accommodation.”



2.15 The draft planning scheme will in future, therefore, distinguish between non‐

resident workers accommodation, relocatable home parks and short term

accommodation. The first is targeted at servicing non‐resident workers, the

second permanent residents and the third being for travellers/tourists. The draft

planning scheme, therefore, reflects a distinction that did (does and should) exist

in market terms, that there is a difference in the customer base and operation

between non‐resident worker accommodation as compared with relocatable

home parks and short term accommodation.


11 Major Projects

3 MAJOR PROJECTS

3.1 Western Downs Regional Council, including the Chinchilla region, is a major

source of energy projects in Queensland.

3.2 The subject site is located in the Surat Basin Energy Resource Province (SBERP)

which contains a diverse range of energy opportunities including oil, coal seam

gas, natural gas, underground coal gasification and coal. Historically, resource

activities within the Surat Basin Energy Resource Province had been oil, and to a

lesser extent natural gas, in the western extent of the Basin and coal in the

eastern extent. Over the past ten years coal seam gas has become a major

developmental opportunity within the SBERP with a number of major gas field

and pipeline projects being promulgated including:

a. Santos GLNG Project;

b. APLNG Project (Origin, Conoco Philips and Sinopec);

c. Arrow Energy Project; and

d. Queensland Curtis LNG Project (QGC).

3.3 The Surat Basin Energy Province is highly prospective and there is a range of

coal, gas and mineral exploration projects being undertaken, some of these fall

into the remit of the larger projects outlined above, while others are driven by

smaller energy players.

3.4 The CSG projects of most relevance to the Stayover facility today and in the

future are the Queensland Curtis LNG project (QGC) and the Arrow Energy

project. Both have extensive development areas under their control in the

Warrego Highway corridor between Miles to Dalby, with pipeline construction to

Gladstone.


12 Major Projects

3.5 Figure 3.1 below shows the gas field development areas of the Arrow Energy

projects highlighting a development corridor between Wandoan to Miles and

through to Chinchilla and Dalby.


13 Major Projects

FIGURE 3.1 – COAL SEAM GAS DEVELOPMENT AREAS


14 Major Projects

3.6 The projects being developed by Santos and Origin are to the west of this area

situated around Roma and Miles and of less relevance to accommodation

facilities in Chinchilla.

3.7 The development of coal seam gas projects is characterized by a relatively long

construction phase which includes the drilling and capping of a large number of

wells and in field pipelines connected to a major transmission pipeline to

transport the CSG to LNG processing facilities located on Curtis Island in the Port

of Gladstone. A series of many field compression stations and several central

processing plants are also required in order to remove water and other

impurities and compress the gas for transmission through the pipelines.

3.8 The large employment demands of these major gas projects mean that

workforces are temporary in nature and, therefore, predominantly non‐resident

with remote communities unable to supply the large volumes of specialised

workers required to meet temporary labour demands. It also moves with the

workfront as the facilities and pipeline is built.

3.9 Large scale CSG projects entail a range of construction and operational

processes, which are located both on and off tenements. These processes

include:

a. Drilling, installation, operation and maintenance of production, monitoring,

and potentially underground gas storage injection wells;

b. Installation, operation and maintenance of gas and water pipeline gathering

and transmission networks;

c. Construction, operation and maintenance of water management and

treatment infrastructure, and associated waste (e.g. brine and solid salt)

management and end‐use infrastructure;

d. Construction of gas treatment and compression facilities;


15 Major Projects

e. Various support and ancillary activities, and the installation, operation and

maintenance of associated supporting infrastructure including, but not

limited, to:

i. installation and operation of workforce accommodation and

associated facilities, including sewerage treatment;

ii. Installation of power supply, including generation facilities and

powerlines (overhead and underground) various support and ancillary

activities for the installation, operation and maintenance of

associated infrastructure including, but not limited to access roads;

borrow pits and quarries; lay down, stockpile and storage areas;

maintenance, workshop, construction‐support, warehousing and/or

administration facilities, ordinarily co‐located with other facilities; and

f. Demolition, decommissioning and rehabilitation of infrastructure and

disturbed areas.

3.10 The process of extracting coal seam gas relies on the drilling of production wells

(which are supported by monitoring and storage wells), which are in turn

connected to a low pressure gas gathering system. These low pressure gathering

pipelines are connected to treatment and compressor facilities (also called field

compression stations) which compress the gas for transmission in high pressure

pipelines. These high pressure pipelines connect to hub compression facilities

(central processing plants) prior to transmission to LNG facilities in Gladstone or

other third parties (e.g. power generators).

3.11 The extraction of gas generates significant volumes of brackish water, which

requires desalinization treatment at reverse osmosis plants. There have been a

range of investigations into the potential uses for surplus treated CSG water.

Currently, irrigation is considered the most cost effective use for this water.

Using treated CSG water for irrigation could assist in stabilising annual


16 Major Projects

agricultural production volumes of the region’s core agricultural commodities of

beef cattle, grain and cotton.

3.12 The operation phase of gas projects is characterized by small ‘custodial crews’

undertaking ongoing inspections and basic maintenance of wells and pipelines

and larger overhaul crews responsible for overhauling well heads and

transmission infrastructure. Additionally, the process of extracting CSG produces

large amounts of brackish water which requires treatment through reverse

osmosis plant before the water can be discharged.

3.13 It can be difficult to differentiate between construction and operations phases of

CSG projects because individual wells may only have a life of five to ten years

(depending on reserves) and new wells need to be drilled over a long horizon to

ensure stable levels of production.

3.14 The CSG workforces are a mix of gas company employees; employees of major

engineering contractors (e.g. Laing O’Rourke, Theiss, etc.) and employees of

smaller scale contractors.

QGC Project

3.15 The QGC project is more advanced than the Arrow Energy project, with major

construction of downstream and upstream facilities nearing completion. Chart

3.1 illustrates total workforce numbers for the QGC project, based on a

presentation entitled Chinchilla CSG Local Content Forum from December 2014.

3.16 This indicates a total workforce which was approximately just over 4,000 in 2011

that increased to over 14,000 by 2013 and is projected to fall over back to

around 3,500 – 4,000 persons over the longer term. This includes a breakdown

of number of contractors and employees, indicating a substantial number of

contractors, in‐excess of 2,000 – 2,500 over the longer term.

3.17 Relevantly, in an operations bulletin dated July 2015 and released by QGC, it is

indicated that QGC recently mothballed worker camps at Kenya and Windabri

(near Chinchilla) reflecting a reduction in construction activity.


17 Major Projects

3.18 The development of drilling rigs is now the most important component of the

project with around 25 new wells being constructed each month.

3.19 In minutes from a meeting of the QGC Central Gas Field Community Committee

from Wednesday 3rd December 2014, longer term employment by QGC was

estimated at 3,400 employees and contractors, with the majority of contractors

(estimated 2,000) to be upstream (i.e. near Chinchilla). The main operational

base for QGC longer term has been established in Chinchilla. It is also indicated

in that report that in relation to camps, that demobilisation of camps has been

planned in stages with third party camps, with future requirements likely to be

around half the number of beds used in the past three years and approximately

300 – 400.

CHART 3.1 – QGC WORKFORCE NUMBERS

Arrow Energy Project

3.20 The Arrow Energy Social Impact Assessment (SIA) Chapter 22 outlines the

number of field based workers and housing requirements for the Surat Gas


18 Major Projects

project at Table 22.5 (repeated as Table 3.1). Chart 22.2 of the report shows the

likely construction workforce and operational workforce as well as onsite

support workforce over time (repeated as Chart 3.2).

3.21 The estimated temporary workforce accommodation facility sizes and years for

peak capacity at each development region is indicated at Table 22.6 of the SIA,

indicating that for Chinchilla some 310 beds would be required at peak from

2020 to 2022. Further demand will be required outside this period.


19 Major Projects

TABLE 3.1 – ARROW ENERGY WORKFORCE


20 Major Projects

CHART 3.2 – ARROW ENERGY WORKFORCE

Other Major Projects

3.22 Advance Western Downs is a key initiative of the Western Downs Economic

Development Task Group and the strategic partnership between the Western

Downs Regional Council, Local Chambers of Commerce and key business leaders

across the region. The website for this organisation lists the major projects in the

Western Downs region as at July 2014. Some of the major projects in and around

Chinchilla include:

a. Underground coal gasification projects as proposed by Linc Energy and

Golden Cross Resources.

b. Coal projects by Cockatoo Coal and CS Energy such as Krugers, Glen Wilga

and Haystack Road.

c. Solar Dawn Project

d. Braemar Power Station 3


21 Major Projects

e. Other proposed mining developments such as Sefton Park and Rywong.

3.23 Map 3.1 outlines proposed projects in and around Chinchilla as at May 2013.

This indicates a significant range of projects including coal seam gas, coal and

urban gasification as well as mineral development and power plants within the

region. A range of these projects will continue to demand non‐resident

workforce accommodation both existing and proposed for future construction

as well as maintenance and a range of other requirements.

3.24 Further, the Queensland Treasury in its Queensland Government Statisticians

Office Surat Basin Non‐Resident Population Projections 2015 – 2021 lists major

projects within the area including:

a. Kogan Creek Solar Boost Project by CS Energy.

b. Braemar 3 Power Station by ERM Power.

c. Elimatta Project by New Hope Group.

d. Ironbark Project by Origin Energy.

e. North Surat – Collingwood Coal Project by New Hope Group.

f. Surat Basin Rail Project – Surat Basin Rail.

g. The Range Project by Stanmore Coal.

h. Wandoan Coal Project by Wandoan Joint Venture.

3.25 Reinforcing much of the documentation within the relevant planning scheme,

there are numerous existing and proposed energy projects throughout the

Western Downs region area including around Chinchilla, which will demand non‐

resident workforce accommodation.


22 Major Projects

MAP 3.1 – MAJOR PROJECTS WESTERN DOWNS


23 Projected Worker Numbers

4 PROJECTED WORKER NUMBERS

4.1 In 2015, Queensland Treasury and Trade prepared estimates regarding the

projected size of the non‐resident workforce on‐shift within the Surat Basin,

contained within the publication Surat Basin non‐resident population

projections, 2015 to 2021. The report provides three alternative projection

series (Series A, B, and C), with projects in Series A including only committed

projects and projects in Series B‐C including projects at various stages of

planning. Surat Basin is defined as the local government areas of Maranoa (R),

Western Downs (R) and Toowoomba (R).

4.2 In 2014, there was an estimated 14,490 non‐resident workers on‐shift within the

Surat Basin. By 2021, the number of non‐resident workers on‐shift in the Surat

Basin is projected to decline to between 3,650 workers (Series A) and 5,470

workers (Series C). All this information is summarised in Table 4.1.

TABLE 4.1 – SURAT BASIN NON‐RESIDENT WORKERS ON SHIFT

Year Ending Western Downs Surat Basin

June Series A Series B Series A Series B Series C

2014 9,100 9,100 14,490 14,490 14,190

2015 5,170 5,170 7,170 7,170 7,170

2016 3,690 3,970 5,400 5,830 5,830

2017 3,660 4,750 5,270 6,660 6,710

2018 3,640 5,150 4,980 6,620 6,690

2019 3,650 4,360 4,930 5,750 5,850

2020 3,070 3,930 4,310 5,340 5,940

2021 2,450 3,250 3,650 4,460 5,470

Source: Queensland Treasuary, Surat Basin Population Projections, 2105‐21



4.3 There was an estimated 9,700 non‐resident workers on‐shift within Western

Downs Regional Council in 2014, having increased by 7,100 persons since 2007,

largely due to the construction workforces of the APLNG and QCLNG projects.

Under projection scenarios, the number of non‐resident works on‐shift in

Western Downs Regional Council is projected at an estimated 2,500 – 3,250 non‐

resident workers on‐shift by 2021. These levels are still higher than existing

levels prior to the development of the LNG projects. Importantly, there is still

substantial demand over the next 6 – 7 year period including peaks of 3,500 –

5,000 non‐resident workers in 2018.

4.4 The Queensland Treasury and Trade publication, Surat Basin Population Report,

2015, provides estimates of the size of the non‐resident workforce on shift

within the Surat Basin as of June 2015. This was released in December 2015,

after the above report. This indicates that there was an estimated 3,560 non‐

resident workers on‐shift within Western Downs Regional Council in 2015.

4.5 The Queensland Treasury projections relate to non‐resident workers on‐shift. At

any time a significant proportion of the non‐resident workforce will be off‐shift.

4.6 Importantly, for Western Downs Regional Council, the ongoing non‐resident

workforce over the period 2016 to 2019 is projected at close to 4,000 workers,

more than four times the non‐resident workforce prior to 2010. Even by 2021,

this figure is still around 2,500 workers according to Queensland Treasury

forecasts.

4.7 There are a number of challenges in accurately projecting the future demand for

non‐resident workforce facilities in a region such as the Surat Basin where gas

development is the current primary driver of demand. This is because gas

projects are developed over large areas and include long developmental

horizons with new wells being drilled some twenty years after a project is

commenced.



4.8 The decline in non‐resident workers after 2014 is largely associated with the

completion of the main high pressure transmission pipelines.

4.9 Energy Skills Queensland (ESQ) prepared the ‘Queensland CSG to LNG Industry

Workforce Plan‐Operations and Maintenance 2014‐2034’ (ESQ Workforce Plan),

which articulates the likely workforce requirements for the Queensland CSG

(upstream) and LNG (downstream) industries based on a number of scenarios,

including:

a. 39,000 wells ‐ Base scenario based on Santos GLNG, APLNG, QCLNG and

Arrow Energy CSG/LNG projects;

b. 45,000 wells ‐ Base scenario plus 15% more wells; and

c. 59,000 wells ‐ Base scenario plus 30% more wells.

4.10 The ESQ Workforce Plan relates to Queensland, providing a range of insights into

the CSG sector and its workforce requirements. Figure 4.1 below reports the

anticipated workforce requirements of the upstream component of the

CSG/LNG industry. Upstream refers to gas field and pipeline construction,

operation and decommissioning. While Figure 4.1 is based on a more expansive

industry than what is represented within the Western Downs region, it does

highlight that as well development activity slows, well servicing activity

increases. Also, Figure 4.1 highlights how ‘gas field and facility development’

generally tracks in line with ‘CSG drilling and well completions’. If all of these

workforce types are combined, Figure 4.2 indicates that the peak upstream

workforce in Queensland is projected to occur in about 2024 with a lesser peak

occurring in 2018. These peaks are respectively estimated at being 40% and 30%

greater than the 2014 estimate. The relevance of Figures 4.1 and 4.2 to the

Western Downs region is that both have a significant number of wells yet to be

completed.



FIGURE 4.1 – TOTAL UPSTREAM WORKFORCE REQUIREMENT BASED ON 45,000 WELLS



FIGURE 4.2 – PROJECTED WORKFORCE NEEDED (UPSTREAM) FOR THE CSG TO LNG INDUSTRY IN QUEENSLAND 2014 TO 2034 FROM ESQ REPORT FOR VARIOUS DEVELOPMENT SCENARIOS


28 Non‐Resident Worker Accommodation

5 NON‐RESIDENT WORKER ACCOMMODATION

Non‐resident Worker Accommodation

5.1 Non‐resident worker accommodation as defined in the Draft Planning Scheme

specifically targets non‐resident workers and does not include motels and

hotels.

5.2 Within Chinchilla, there are two non‐resident worker facilities including:

a. Base Camp Chinchilla: 314 room accommodation village.

b. Stayover Chinchilla: 1,000 rooms.

5.3 In addition, there have been a number of non‐resident workforce

accommodation facilities on actual mining leases operated by the gas company.

As indicated recently, facilities operated by QGC at Kenya and Windabri with 200

and 140 rooms respectively, have been closed recently.

5.4 Other information in relation to gas company leases are more difficult to

ascertain.

Motels/Hotels

5.5 There are a range of other accommodation facilities within the region that can

contribute to accommodation of workers if required. Table 5.1 lists

hotels/motels within Chinchilla, with these facilities illustrated at Map 5.1.

5.6 The quality of services provided and management of these facilities varies and a

number would cater for workers outside the gas industry in terms of

representatives from broader industries and the like.

5.7 Information from the ABS publication No 8635 indicates there were some six

motels/hotels with 15 rooms or more within Chinchilla and that these facilities

supplied some 169 rooms with 447 beds as at June 2013, the last official date of

this publication. The room occupancy in the June Quarter 2013 was around 90%,

with bed occupancy at close to 43.6% (refer Table 5.2).



MAP 5.1 – EXISTING ACCOMMODATION FACILITIES CHINCHILLA



TABLE 5.1 – EXISTING ACCOMMODATION FACILITIES CHINCHILLA

% of total Camps or % of total

Facility No. of rooms Motels/Hotels accommodation

Non‐Resident Workers Accommodation/Camps

Base Camp 314 23.9% 16.4%

Stayover Camp 1,000 76.1% 52.2%

Total 1,314 100.0% 68.6%

Motel/Hotels

Kings Park 72 5.5% 3.8%

Chinchilla Tourist Park 70 5.3% 3.7%

Stonewood Villas 70 11.6% 3.7%

Bottle Tree Apartments 70 11.6% 3.7%

Chinchilla Motor Inn 62 4.7% 3.2%

Cypress Pines 45 3.4% 2.3%

Downtown Motor Inn 44 3.3% 2.3%

Palms Motor Inn 31 2.4% 1.6%

Great Western Motor Inn 26 2.0% 1.4%

Central Motor Inn 23 1.8% 1.2%

Commercial Hotel/Motel 23 1.8% 1.2%

Acacia Motel 18 1.4% 0.9%

White Gums Motor Inn 16 1.2% 0.8%

Riverdell Park Estate 12 2.0% 0.6%

Chinchilla Motel 10 0.8% 0.5%

Laurells B & B 10 0.8% 0.5%

Total 602 100.0% 31.4%

Total Accommodation 1,916



TABLE 5.2 – ABS HOTEL/MOTEL DATA, JUNE 2013

5.8 Relevantly, the average length of stay as reported in the ABS publication from

2013 was 2.6 nights. This is reflective of a short term accommodation visitor as is

typically expected of a motel, compared with non‐resident workers spending up

to three weeks each shift within non‐resident workforce facilities.

5.9 The number of rooms as at June 2013 in the ABS Publication is less than

indications of existing motel/hotel rooms, meaning a number of more recent

approvals/developments must exist. The number of rooms within motels is

currently estimated at around 600 rooms, significantly lower than the 1,314

rooms within the non‐resident worker accommodation facilities. Importantly,

the 600 rooms in motels would not have been enough to accommodate all

workers in the past 3 – 4 years.

5.10 Overall, there is a large difference in the services, nature and pricing of facilities

between hotel/motel accommodation and non‐resident worker accommodation

villages. The former is more attractive to visitors and independent business

travellers and short term contractors, while the latter is more attractive to

employers seeking to accommodate a large number of workers close to their

place of employment and where all amenities can be provided in the one

location (e.g. three meals per day, recreation facilities and the like) with

consistency.

Chinchilla

Establishments 6

Rooms 169

Beds 447

Persons employed 109

Room nights occupied 13,655

Guest arrivals 6,732

Guest nights occupied 17,734

Average length of stay 2.6

Room occupancy rate % 88.8%

Average takings per room night occupied ($) 146.4

Takings from accommodation ($M) 1,998,675.0

* Statistics for hotels, motels and serviced apartments with 15 or more rooms

SA2 level from March 2013 ‐ June 2013.Source: ABS Cat. No. 8635.3.55.001



Choice Between Non‐Resident Worker Accommodation and Hotels/Motels

5.11 The choice of housing transient workers in hotels/motel and houses versus non‐

resident workforce accommodation facilities varies from employer to employer.

In general, there has been an increasing demand for non‐resident workforce

accommodation as a result of the following factors:

a. Villages allow the workers for a single company undertaking a contract in the

area to be accommodated all together in the one location. This controls

employment conditions giving an employee uniformity of conditions for a

large workforce rather than being spread across a number of accommodation

styles, with different services and standards.

b. A centralised accommodation location to coordinate the transport of workers

to and from the project site and alleviates multiple transport routes in the

township area.

c. A food mess or dining hall is provided inhouse , providing for all dietary needs

and ensuring a healthy diet for the workers, relieving workers of the need to

find the time and have the skills and energy to provide food for themselves

after long shifts.

d. Villages can be designed and segregated for day and night shift workers to

ensure that night shift workers are not disturbed during the day. This is

difficult to achieve in hotels/motels and traditional houses in residential areas

with other users in the surrounding areas as well as other housemates being

active during the daytime.

e. Modern villages provide an enhanced level of amenity in terms of room

quality, landscaping, etc. compared to the older styled camps.

f. Cleaning, gardening, repairs and maintenance issues can be left to others.

g. The ability of modern villages to provide amenities for each worker rather

than shared facilities.



h. There is direct access to first aid on‐site together with other facilities such as

entertainment and a gymnasium.

i. Workers have substantial cleaning requirements and specialised, extensive

laundry facilities can be provided at the villages.

j. Appropriate provision for vehicle parking (typical residential houses and

hotels/motels do not cater for the private vehicles of 4 – 5 single workers

resulting in undesirable street parking practices.

k. A resident code of conduct is enforced by site based management and

security, ensuring that protocols and standards of behaviour are observed,

encouraging an appropriate balance between lifestyle, sleep and nutrition.

5.12 In reality, therefore, major employers within the Chinchilla region would

ultimately be choosing between operating their own camps on remote mining

leases or facilities such as Stayover Chinchilla and Basecamp.

5.13 The hotels/motels within Chinchilla appear to only have been used during peak

periods of construction demand and, therefore, accommodation needs at that

time. With the completion of initial construction, the demand for

accommodation facilities has fallen from peak levels and, consequently,

hotels/motels are now attracting minimal, if any, business from this non‐

resident workforce, with the preference from the major companies for the

workforce to be in non‐resident workforce accommodation villages.

5.14 Another important element in the performance of existing motels/hotels can be

seen in the data presented previously at Paragraph 5.7 – 5.9, which indicated

the number of rooms in hotels/motels with 15 or more rooms, increasing from

169, to almost 600 by 2015. There has been substantial additional supply

brought on during the peak construction period for CSG by the hotel/motel

industry itself in the area. With the fall in demand due to the slowing

construction, there is now an oversupply of this type of facility for its traditional

tourist and traveller market.



5.15 This reflects the importance of modular non‐resident workforce

accommodation, as compared with permanent bricks and mortar hotel/motel

accommodation in locations such as Chinchilla. Modular accommodation can be

downsized in line with demand, whereas now there are a large number of

motels/hotels without sufficient customers at this current point in time.

5.16 The large provision of motels/hotels does not take away from the need for

Modular accommodation, with the two separate style of facilities able to

operate in conjunction with each other, serving different roles, in appropriate

quantities to meet market demand.



Conclusions

5.17 The importance of non‐resident workforce accommodation is evidenced through

information provided in Section 1 which indicated that Stayover Chinchilla has

1,000 rooms fully occupied across an extensive period of time. The amount of

rooms occupied at the site was well in‐excess of the number of motel rooms

within the region, indicating that without a facility such as Stayover Chinchilla,

accommodating the needs of non‐resident workers within Chinchilla would have

been difficult in that timeframe.

5.18 Further, assessing the supply and demand for non‐resident worker

accommodation facilities (i.e. a perfect matching of supply and demand) is not

appropriate. In reality, there should always be a supply in‐excess of demand

(such that the average occupancy is well below 100%) to accommodate the

potential peaks, which could be either expected or unexpected, and to provide

for choice of location and operator.


36 Benefits of Stayover Chinchilla

6 BENEFITS OF STAYOVER CHINCHILLA

6.1 In addition to being an important element of meeting the accommodation

demands of major workforce and construction projects in the region, non‐

resident workforce accommodation such as Stayover Chinchilla has other

important benefits including:

a. Housing price impacts.

b. Money spent within the local economy.

c. Flood evacuation centre.

6.2 Each of these issues are discussed below.

Housing Impacts

6.3 Historically, within Chinchilla during the peak of the gas construction boom,

occupancies were running at 90% ‐ 100% as evidenced by the use of motels as

well as information provided in relation to Stayover Chinchilla (Section 1). This is

not an ideal situation due to increased demand for traditional housing and the

impact on housing prices for locals.

6.4 Chart 6.1 reviews residential house price growth within Chinchilla over the

period from 2005 to 2015. This indicates rapid growth in house prices, a more

than doubling in that timeframe, with a fall in the most recent year in‐line with

the decline in demand from the construction workforce associated with the coal

seam gas project. It would be expected that house prices would likely continue

to fall over the next few years.

6.5 Information is also available in relation to rental data which indicates that rents

in Chinchilla for three and four bedroom houses as sourced from the Residential

Tenancy Association of Queensland increased rapidly from June 2010 to June

2013 and have halved since June 2013 through to June 2015 (refer Table 6.1).



6.6 Consequently, with spikes in accommodation demands, facilities such as

Stayover Chinchilla help to ease pressures on household rents and prices

generally in areas where peak demand occurs for local resident populations.

6.7 The rapid house price movements as well as rents indicate the market being

unable to respond to increases in demand when projects are being undertaken.

When mining projects are committed, the mining company usually starts

construction within a short period of time. Without the certainty of

construction, it is very difficult for investors to invest in new accommodation in

towns like Chinchilla. Consequently, investment in accommodation will always

lag investment in mining construction.

6.8 During periods of high demand, such as experienced recently at Chinchilla, large

increases in rental housing prices have the potential to result in significant social

impacts. Large increases in house prices also lead to large increases in rents,

leading to division in places such as Chinchilla with existing residents priced out

of the market.

6.9 The ongoing use of Stayover Chinchilla, therefore, is vitally important to a stable

economic environment. The large transient nature of construction workforces is

better suited to modular accommodation, rather than building permanent

buildings such as hotels/motels or houses, with a number of hotels/motels now

experiencing low vacancy levels due to the short term construction demand now

being over, and the lower level of demand, in line with lower construction

activity, being over catered for by bricks and mortar buildings.



CHART 6.1 – HOUSE PRICE GROWTH, CHINCHILLA

$‐

$50,000

$100,000

$150,000

$200,000

$250,000

$300,000

$350,000

$400,000

$450,000

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Median Price ($)

Financial Year

Median Price for Houses (Financial Year)

HouseSource: Location IQ,Price Finder



TABLE 6.1 – RENTAL GROWTH, CHINCHILLA

Local Community Spending

6.10 Information provided by Stayover Chinchilla indicates that in 2014 some $5.86

million dollars was spent directly in the Western Downs Local Government Area

by the operation of the vilage. This comprised a range of industries including

pest control, Australia Post, landscape supplies, concreting, stationary supplies,

electrical repairs, waste removal, hardware supplies, air‐conditioning services

and the like.

6.11 This $5.86 million in direct spending would also have multiplier effects in the

wider economy, usually resulting in at least a doubling in spending.

6.12 In addition, the workers at Stayover Chinchilla would also spend in the town, by

virtue of them staying in town rather than out on mining tenements/leases. This

spending in particular would be directed to the following types of facilities:

a. Service stations as part of petrol/refuelling.

b. Food and catering stores, with a number of workers choosing to eat offsite at

various times during their stay.

Chinchilla 3‐Bedroom House 4‐Bedroom House

Number of Houses Rented

• Year to June 2010 35 39






Median Rent ($)

• Year to June 2010 $280 $380

• Year to June 2011 $300 $400

• Year to June 2012 $365 $500

• Year to June 2013 $450 $615

• Year to June 2014 $380 $445

• Year to June 2015 $200 $270

Source: The State of Queensland Residential Tenancies Authority



c. Local RSL/hotels in terms of entertainment spending.

d. Liquor outlets.

e. Taxi services.

f. Local convenience facilities such as supermarkets, newsagents, health‐food

stores, chemists and the like.

6.13 It is difficult to be precise on how much money is spent by non‐resident workers

at Stayover Chinchilla. On average, individuals in Queensland spend around

$13,500 each year on retail items. Allowing for most food/meals to be catered

for at Stayover Chinchilla, this figure would reduce to around $10,000 a year for

non‐resident workers.

6.14 If Stayover Chinchilla is 50% occupied, the total spent on retail items by non‐

resident workers would be equivalent to $5 million a year (i.e. 1,000 workers by

50% occupied by $10,000 a year). The proportion of this retail expenditure by

non‐residents workers spent locally could be as high as 40%‐50% given workers

are in the village three out of every four weeks and away from home, meaning

an additional $2‐$2.5 million available locally.

6.15 The amount of money spent annually within the town, therefore, is significant,

with a wide range of businesses benefiting directly from Stayover Chinchilla, and

also indirectly in terms of workers spending on local facilities.

6.16 Most of this spending would be lost from the local economy if Stayover

Chinchilla was closed and these workers were redirected to camps provided on

the mining leases, with no flow‐on benefits from their easy access to the town.

Flood Evacuation Centre

6.17 In addition, the Stayover Chinchilla facility played an important role during the

floods in the Chinchilla region, being a nominated evacuation point.


41 Conclusions

7 CONCLUSIONS

7.1 There is a clear need and demand for the Stayover Chinchilla facility for the

following reasons:

a. Major mining investment is being undertaken and proposed for the Chinchilla

region which will result in ongoing demand for accommodation and

appropriate planning for accommodation should continue.

b. With Stayover Chinchilla's existence, the Council can seek to attract large

workforces to use the town as a base and obtain the economic benefits of

that.

c. The need to accommodate non‐resident workers within the town is also an

important factor to consider in this analysis as compared with camps on

mining leases.

d. The majority of future workers within the Chinchilla region will require single

person non‐resident worker accommodation.

e. Investment in major housing is unlikely to occur given the uncertainty of

housing as a long term investment for a town like Chinchilla.

f. This is evidenced by the low housing prices that have traditionally occurred in

Chinchilla prior to recent CSG activity.

g. The Stayover Chinchilla facility allows for orderly development of residential

uses and lessens pressure on rapid price increases in house and rental

markets that has occurred in Chinchilla and other mining towns in recent

years, affecting local communities.

h. The single persons quarters in the form of the non‐resident worker

accommodation benefits the entire Chinchilla community by adding people

who will spend money on a range of facilities within the Western Downs and

surrounding regions. Information provided by Stayover Chinchilla indicates


42 Conclusions

that in 2014, some $5.86 million was spent directly in the town by the

operation of the village, with further spending by users of the site in relation

to service stations, RSL, retail outlets, liquor and the like.

7.2 The hotels/motels in Chinchilla are not of the size or composition to cater for the

demands of major CSG operators and contractors. If Stayover Chinchilla was to

close, the CSG operators would most likely reopen their recently closed camps on

mining leases or relocate to more remote gas tenement locations where there is

excess accommodation capacity. This would result in a loss of business to the town

due to these facilities being located some distance from town, and workers not

visiting regularly the retail facilities, clubs, pubs etc as they do now given the

Stayover facility forms part of the Chinchilla urban area.

7.3 Alternatively, there are existing approvals for over 700‐800 room non‐resident

worker accommodation in Carmichael Street which would could effectively replace

the Stayover facility (at a more limited size). The notion that the existing

hotels/motels would attract non‐resident workers is unfounded given the

operational requirements of the larger companies, including workers consolidated

in one facility/precinct.

Location IQ 02 8248 0100

Level 6, 56 Pitt Street Sydney NSW 2000

www.locationiq.com.au

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