RESOURCE PEOPLE Issue 05 | Summer 2014

Issue 005 Spring ‘13 – Summer ‘14

Bechtel’s Andy Greig talks Curtis Island Lng projects and 60 years in Australia

Transfield Services expanding its footprint

Industry Minister Ian Macfarlane Bluestone Mines builds capacity Abbott and Abetz: policy scorecard PLUS exclusive feature with Leighton’s global HR boss Dharma Chandran

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CONTENTS

CONTENTS REGULARS 04 | From the Editor 05 | Chief Executive’s Message 54 | Events calendar 56 | Business Partner Directory HUMAN RESOURCES 06 | Latest jobseeker trends revealed 08 | Inside Leighton’s skills empire 10 | Construction skills demand remains strong 11 | 5 Minutes with an AMMA staffer

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MEMBER FEATURE 12 | Future focus Transfield Services’ greatest asset LEADERSHIP 14 | Big challenges for Macfarlane in familiar role 15 | AFL legend’s leadership centre takes shape 16 | ‘Get on’ with reform, says ACCI 16 | A quick word with Clive Palmer POLICY 18 | Coalition policy score: where do they stack up?

19 | Six key challenges Labor left for Eric Abetz 20 | Bullying changes: obligations and risks 21 | Policy at a glance MIGRATION 22 | New immigration minister looks at 457 scheme 22 | Wrap-up of Labor’s last migration changes 23 | 457 Visa program effective, says migration council

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OHS & WELLBEING 24 | Making tracks against kidney disease 26 | Empowering healthy habits 27 | Sodexo fast tracks healthy lifestyles COVER STORY 28 | People, projects, performance:

60 years of Bechtel in Australia

COVER IMAGE Andy Greig, Bechtel RixRyan Photography PUBLISHED BY THE MAGAZINE PUBLISHING COMPANY ABN 70 010 660 009

PO Box 406, Nundah Qld 4012 Phone (07) 3866 0000 Fax (07) 3866 0066 Email sales@tmpc.com.au Web www.tmpc.com.au

www.amma.org.au | Spring ‘13 – Summer ‘14 |

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CONTENTS

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DIVERSITY 32 | Queensland women say ‘count me in’ 33 | Connecting through AWRA e-Mentoring 34 | Ozzie women meet the challenge 36 | Waking up to unconscious bias 36 | Fortescue reaches milestone 37 | Indigenous student of the year

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TRAINING & DEVELOPMENT 38 | Bluestone Mines builds training capacity 40 | How to plan for uncertainty 42 | E-campus masters marine training INNOVATION 44 | Shifting gears with Bernard Salt 45 | Wi-Fi first in Bowen Basin 46 | Keeping on course with community relations 47 | Orica invests in Newcastle ECONOMY 48 | Economist Eslake sees change on the horizon 49 | Global competitiveness continues slide 50 | Wages threat to offshore oil and gas 52 | Investment outlook with global experts EVENTS 54 | Events Calendar

34 Editor | Tom Reid Tom.Reid@amma.org.au Deputy Editor | Kylie Sully Kylie.Sully@amma.org.au Advertising | Tara Diamond Tara.Diamond@amma.org.au

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AMMA Contacts 1800 627 771 | membership@amma.org.au migration@amma.org.au miningoilandgasjobs@amma.org.au training@amma.org.au

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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REGULARS

From the Editor ANDY Greig’s Brisbane office proudly sports a poster of Star Wars Jedi master Yoda, superimposed with the Bechtel boss’ face and the accompanying slogan “Try not, do!”

The cheeky staff gift aptly describes Greig’s measured leadership style as he quietly goes about motivating the people designing and building some of the largest projects our nation has seen.

In 32 years with the company, the understated Greig has rarely donned a business suit or publicly spruiked Bechtel’s achievements or multi-billion dollar portfolio. As he tells Resource People in our cover story, his desire is not just to deliver construction of seven major Australian resources projects, including three side-by-side LNG developments on Queensland’s Curtis Island, but to leave behind a positive community legacy.

Another AMMA member seizing opportunities provided by Australia’s burgeoning LNG investment is asset management and services contractor Transfield Services. CEO of the energy and mining division, Joe Sofra, tells us why he is bullish on Transfield’s diversification strategy and provides insight into the people and planning behind complex project shutdown activities.

In Human Resources, Leighton Holdings’ global HR chief Dharma Chandran speaks of the competitive environment in which the multi-

www.amma.org.au |Spring ‘13 – Summer ‘14 |

national construction and mining contractor operates. With 30,000 employees in Australia alone across the Leighton, Thiess, John Holland and Macmahon brands, he reveals the innovative workforce engagement techniques that keep the group at the top of its game.

Other stories in this final issue of 2013 include Bluestone Mines’ leadership training, Oz Minerals’ award-winning gender diversity practices, the latest in OHS and migration and a look at wages and competitive challenges in the offshore oil and gas sector.

Economy features investment commentary from Saul Eslake and the global mining heads of KPMG and Deloitte Touche Tohmatsu. In Innovation we talk to Bernard Salt about demographics and UQ on community engagement; while Training explores maritime safety and emergency management.

The final piece to our strongest Resource People edition yet is a comprehensive look at the new Coalition Government’s workplace policies and how frontbenchers Eric Abetz and Ian Macfarlane plan to instill greater confidence and stability into our industry, which continues to deliver employment, social and economic benefits for the whole country.

So whether your interest is big project construction, workforce management, economics, training or policy and political matters – there is something in Resource People for everyone.

Tom Reid Editor

REGULARS

Chief Executive’s Message THIS EDITION OF Resource People spans an important period for Australia’s resource employers as we close out a year that’s seen some challenges, though none insurmountable, and move towards 2014 with a renewed sense of optimism.

With a new federal government that has promised a more stable and balanced policy platform for doing business in our sector and our country more widely, one political catchphrase we hope to never hear again is ‘the boom is over’.

The industry has never adopted this simplistic ‘boom versus bust’ dichotomy nor have we ever accepted that resources growth is irrevocably coming to an end.

Our industry already generates 1.1 million jobs and more than $20 billion annually in royalties and taxes, yet Australia is still to reap the full social and economic benefits of the production and export phase following the past decade’s record resources investment.

There also remains about $350 billion worth of new projects on the horizon that will continue to fuel large-scale construction activity if we get the policy mix right.

Restoring Australia’s reputation as a globally competitive and productive business and investment destination is key to bringing this opportunity to market. With the right policies, investment and growth can become the long term and sustained norm in Australia.

AMMA is working constructively with Prime Minister Tony Abbott, whom we’ve known well since first elected to parliament in 1994, and his ministerial team to do just that.

We’ve encouraged Mr Abbott to hit the ground running and to swiftly implement his government’s stated plans.

Resource People’s interview with our new Minister for Industry, Ian Macfarlane, reveals an experienced and considered leadership outlook as the former Howard Government minister takes back control of his old portfolio and once again declares Australia’s mining sector ‘open for business’.

Another minister for whom AMMA has great respect and a strong working relationship with is Senator Eric Abetz, who has been assigned the key portfolio of employment.

AMMA has long advocated for appropriate workplace relations settings that provide adequate employee protections but also allow employers to be flexible, innovate and ultimately drive a highly productive and engaged workforce.

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This has been our consistent approach regardless of who is in government.

As analysed within these pages, the Coalition’s Policy to Improve the Fair Work Laws doesn’t tick all the boxes but it makes a good start in restoring genuine balance and addressing the plethora of recent anti-business, pro-union IR re-regulation that has been so damaging to Australian businesses.

Welcome first moves include restoring the Australian Building and Construction Commission (ABCC) as an effective building industry industrial regulator, breaking the union monopoly on new project agreements and restoring some balance to what have proven to be excessive and often disruptive union site entry powers.

Another priority area for our sector will be access to responsible and economically responsive skilled migration programs, including the 457 Visa scheme and Enterprise Migration Agreements (EMA).

New Immigration Minister Scott Morrison, who has addressed AMMA forums on numerous occasions in recent years, is well versed and supportive of our sector’s needs and responsible use of specifically targeted skilled migration programs.

We will also be working with the government and maritime authorities to ensure any changes to Australia’s intercontinental migration zone doesn’t wreak havoc on our nation’s $150 billion offshore oil and gas sector.

Just as critical to maintaining our industry’s strength are the non-legislative workforce initiatives that AMMA is implementing to great effect, many in ongoing partnership with the Commonwealth.

With each edition of Resource People I am proud to read the next phase of AMMA Skills Connect is being rolled out across the country as this program works to improve labour mobility, transitioning of skills and training of people in trades roles.

Similarly, online recruitment hub AMMA miningoilandgasjobs. com continues to go from strength to strength while the Australian Women in Resources Alliance (AWRA) is rapidly developing new tools and engagement techniques to support increased female participation in our traditionally maledominated industry.

The training profile of this edition features our work with Bluestone Tin and how the company is building the leadership capabilities of its people. We can help all our members tap into the government’s Workforce Development Funding to achieve similarly valuable results.

These efforts and initiatives greatly advance AMMA’s vision of ensuring Australia’s resource industry is an attractive and competitive place to invest, employ people and contribute valuably to the national wellbeing. This is even more important with a change in government providing new opportunities for us to further progress this.

Reading about Bechtel, Transfield Services, Leighton Holdings and the plethora of other success stories in this magazine demonstrates that collectively, Australia’s resource industry remains on track to continue being a key driver of improved well being and living standards across our community.

Steve Knott AMMA Chief Executive

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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HUMAN RESOURCES

Jobseeker traits and trends revealed in new resources index Trade-qualified men aged 35-55 remain the largest group of resource industry jobseekers, but a new industry-led demographic index reveals some surprising traits among people actively pursuing careers across Australia’s mining, oil and gas sectors.

The AMMA miningoilandgasjobs.com Jobseeker Index is a new biannual analysis of the trends, motivations and demographics of resource industry jobseekers and the first edition delivered wide ranging results.

“The index shows jobseekers typically have more than 15 years’ experience in the workforce and varying degrees of education, though many hold diplomas, certificates or trade qualifications,” says AMMA miningoilandgasjobs.com director Kyla Jones.

“Many are hoping to progress their career within the industry or want to transfer from another sector and take advantage of the benefits a resource career offers.

“Jobseekers also appear to be open to flexible work arrangements, including a range of FIFO rosters with two weeks on, one week off being the most popular choice.

“While men remain the dominant demographic, it is encouraging that 30% of all people showing interest in a resource industry career are women. This shows collective employer efforts to attract more women and increase the traditional 15% femaleparticipation rate, are gaining momentum.”

The results also show that the remote locations, diverse opportunities and flexible nature on offer within the resource industry are seeing more jobseekers gather career information online.

“Networking online and visiting career websites exposes jobseekers to greater opportunities than the local paper or recruitment firm,” Ms Jones says.

“People interested in mining, oil and gas careers are proving to be very tech-savvy, with 62% actively searching through social media channels such as Google+, LinkedIn and Facebook.”

Other key findings from the AMMA miningoilangasjobs.com Jobseekers Index include:

www.amma.org.au | Spring ‘13 – Summer ‘14 |

Kyla JoneS site director AMMA miningoilandgasjobs.com • 72% of jobseekers are aged 35 or older • Men represent 70% of the jobseeker audience with an average age of 42 • 61% of jobseekers have more than 15 years of workforce experience • 23% are Degree educated; 48% are qualified to Diploma, Trade or Certificate I, II, II • Almost a third (32%) hail from Queensland, followed by 18% from Western Australia • Jobseekers are largely motivated by career progression or a change in industry • Jobseekers value information on career development more than other non-salary benefits • Workers experienced in skilled trades, administration, management, engineering and construction represented the largest respondent groups.

The AMMA miningoilandgasjobs.com Jobseeker Index is compiled from a national survey of 1,045 visitors to the resource industry owned-and-operated careers website AMMA miningoilandgasjobs.com.

The index tracks key demographics, lifestyle and job search trends to provide a biannual report on the national resource industry jobseeker audience and recruitment landscape.

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HUMAN RESOURCES

Inside Leighton’s skills empire Almost two years into his role as Leighton Holdings’ human resources chief, Dharma Chandran explains how innovative workforce engagement keeps Australia’s largest diversified construction and mining contractor at the top of its game.

DESPITE amassing 25 years in the international financial services sector before joining Leighton Holdings’ executive team in 2011, Dharma Chandran concedes his current role has given him a newfound appreciation for finding competitive advantage.

“We work in a highly competitive environment, both in the construction and mining sectors,” Chandran says.

“There is a need for businesses to innovate and engage more powerfully with our workforces so they have the necessary skills to continue to meet the expectations of clients.”

While softening commodity prices has led many in the industry to review their investment and expansion strategies, Chandran remains focused on innovative ways to engage Leighton’s workforce and foster the skills to stay one step ahead of the competition.

“Despite these falling commodity prices, there remains a skills shortage. The cost cutting is impacting the demand for labour but the demand for quality, highly skilled labour is still there and is still causing competitive pressures,” he says.

“Interestingly, even though the demand for workers is reducing a little, the expectations of our clients are rising. We have established several creative ways to ensure our business continues to grow and remains profitable in these conditions.”

Chandran’s outlook on growth is no understatement. In June 2013, Leighton Contractors announced a landmark mining deal which set a new record as the largest single contract awarded in the company’s history.

The $1.3 billion deal extended its agreement to mine Fortescue Metals Group’s Solomon Hub iron ore project in the Pilbara, bringing the total value of work to a record $2.8 billion.

www.amma.org.au | Spring ‘13 – Summer ‘14 |

The global Leighton Holdings empire includes subsidiaries across construction, infrastructure, resources and property. Already incorporating the Thiess and John Holland brands in its stable, the group acquired Macmahon Holdings’ construction business last year, taking on more than $570 million worth of additional work.

Together, the group of companies turns over $23 billion of contracts around the world annually and employs more than 57,000 people; 30,000 of whom are Australian-based.

According to Chandran, successfully engaging with a skilled workforce of this size and diversity requires a three fold approach: acquiring and building skills; sharing for success; and retaining Leighton’s best.

Acquiring and Building Skills “The employment brand is a critical component of acquiring and building skills,” says Chandran, a former Ernst & Young partner in charge of the Asia-Pacific Performance and Reward practice.

“Creating strong recognisable brands ensures that we attract the best candidates in the world. Digital communication and social media are important channels for establishing our value proposition and attracting the best people in our organisation.

“Recently, LinkedIn did a survey of the most in-demand brands on their website and I’m happy to report that Leighton Contractors ranked third, John Holland ranked fourth and Thiess ranked ninth.”

Chandran says attracting traditionally under-represented employee groups is also key to remaining competitive.

Encouragingly, women comprise about 17% of its Australian workforce, which is a step-ahead of the national average of 15.1%.

“Through our Women in Mining group together with our

HUMAN RESOURCES

reconciliation action plan we are increasing the participation of non-traditional labour and narrowing the gap,” he says.

But for Leighton Holdings, diversity is greater than gender alone. It was, in fact, Chandran’s diverse cultural background that convinced CEO Hamish Tyrwhitt that he was the right person to head the company’s HR division.

A Sri Lankan-Tamil, Chandran moved to Australia from Malaysia during his senior high school years and, while joking he “missed the plane home and has been here for the past 30 years”, sums up his experience in Australia as “tremendous”.

University educated in law and commerce, he has held a number of corporate and consulting leadership positions throughout Australia and Asia with companies including McKinsey & Co, Towers Perrin and Westpac Banking Corporation.

With 27,000 Leighton employees based in Asia, speaking multiple languages is another valuable asset.

“Diversity goes beyond gender and that’s an important perspective to have in Australia where so many of us come from overseas,” he says. “Gender equity is a serious issue, but inequity is also prevalent across other sections of our population and we shouldn’t lose sight of that.”

Chandran describes career-long learning as his passion, with each of Leighton’s operating companies running extensive career development programs from graduate level to CEO. “The Leighton Group currently offers more than 25 scholarships for engineering students at universities across Australia. We have around 600 people on graduate programs throughout the group and around 500 people in our apprenticeship programs.

“We also have a Leighton Masters in Project Management program, which we do in conjunction with the University of NSW. Each year, up to 30 of our employees are selected to undertake a Masters with all fees covered by us.

“Since I’ve taken over this role, we’ve also launched executive leadership development programs for our top 75 leaders.”

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Sharing for Success Leighton Holdings’ unique corporate structure allows it many competitive advantages, one being access to skills across the group through its internal joint ventures to capitalise on what Chandran refers to as each subsidiary’s “Centre of Excellence”.

“Each of our operating companies has different skill sets and core capabilities and we try to leverage that as far as possible,” he says.

“There have been several occasions where two or more of our operating companies have gotten together to deliver a project.”

Recently, three of Leighton’s companies – Leighton Properties, John Holland and Leighton Contractors’ subsidiary Broad – successfully partnered at the Kings Square development in Perth. The Leighton Properties development will be constructed by John Holland and Broad, and includes Shell Australia and John Holland as tenants.

This type of cross-subsidiary deployment is a critical skills sharing strategy that Chandran wants to expand.

“In the past we have not moved people freely and easily across our operating companies,” he says.

“Their cultures are quite different and employees’ affiliation with their operating brand is strong. John Holland and Thiess have been in existence for a long time.

“But we’re trying to increasingly deploy people to areas, projects and geographies where they’re most needed.”

Retaining Leighton’s Best While there has been much debate between some sections of government, community and industry on the impacts of fly-in, fly-out (FIFO) arrangements, for Leighton the practice is a vital part of its strategy to retain valuable skills.

“The FIFO and DIDO arrangements we have in place are critical for our workers to connect with their families,” Chandran says.

“It ensures family life is not overly disrupted by the remote locations and challenges of our larger projects, particularly in the north and west of our nation.”

Considering engaged employees are more likely to be emotionally committed to their job, it’s no surprise that Leighton’s workforce engagement programs are an important strategy to retaining skills.

However, Chandran explains that sometimes it pays to go back to basics and reassess the way things have always been done.

“We’re launching our first group-wide employee engagement survey,” he says.

“This may not sound very innovative and we have run engagement surveys within each operational company before, but it’s the first time we’ll have a common survey, at a common timing, right across the group.

“Certainly for us, it’s dramatic and transformational change.”

Diversification is a clear theme running through Chandran’s commentary on Leighton Holdings’ business, practices and people.

The company’s ability to carefully balance its group of operations across cyclical markets and remain committed to diversity strategies and skilled workforce engagement will ensure this world-leading contractor continues to attract both clients and candidates of the highest quality.

Dharma Chandran

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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HUMAN RESOURCES

Construction skills demand remains strong Construction labour requirements on Australia’s mining, energy and infrastructure projects have potential to peak at nearly 100,000 workers this year, according to a new labour market index launched by national resource industry employer group AMMA. The biannual AMMA-Pit Crew Labour Market Index details the labour demand of major Australian resource and infrastructure projects, breaking down specific areas of the skills shortage and capital investment state-by-state.

“This index shows that while construction workforce numbers are coming off a massive peak in 2012, during 2013/14 Australia will still see 98,869 people walk through the gate of a major resources, energy or infrastructure projects,” says AMMA director of group services Tara Diamond.

“LNG investment is having the most significant impact on the demand for labour and, despite the need for urgent policy action to address productivity and cost pressures, employment numbers are still set to increase over 2013 towards an expected peak in 2014.

“The Index also shows that while Queensland and Western Australia are home to the majority of major projects, the Northern Territory will experience the greatest labour shortages.

“Labour demand for the Northern Territory’s emerging resource industry will peak at 5,644 skilled construction and trade workers in the coming year, but availability risks being just half of that.

“The ability to meet this demand requires a collaborative approach to facilitate greater domestic labour mobility between states and ongoing investment in training and skills development.”

The AMMA-Pit Crew Labour Market Index draws from the proven labour forecasting system developed by specialist firm Pit Crew Management Consulting.

The Pit Crew modelling reveals Australia’s resource employers will experience a potential skills shortage of 4,000 specialist welders and boilermakers as the mechanical phases of major

www.amma.org.au | Spring ‘13 – Summer ‘14 |

LNG projects ramp up. Other skills shortages include: • Pipe Fitters • Mechanical Fitters • Electrical Trades • Crane Operators • Riggers and Scaffolders • Production Managers • Experienced Production Operators • Engineering Technicians.

“Pit Crew and AMMA have formed a strategic relationship to provide an updated labour market index twice a year,” says Pit Crew managing director Peter Dyball.

“Our modelling includes a range of infrastructure projects which also draw upon the resource industry’s construction labour pool. These projects include roads, power stations, port facilities, hospitals and public rail infrastructure.

“In addition to the construction labour, as these projects head towards completion they are ramping up an operations workforce, which will also require offsite support services.”

In developing the first of the bi-annual Labour Index, Pit Crew modelled 422 resources, energy and infrastructure projects within the Australian market, uncovering a total capital value of $728.8 billion.

Approximately 259 projects are approved with a value of $446.4 billion, while a pipeline of 163 less advanced projects is poised to deliver another $282.4 billion of investment.

HUMAN RESOURCES

5 minutes with...

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AMMA Skills Connect Project Manager Kim Hetherington

kim hetherington

I’ve worked in the workforce development field for: More than 10 years and have experience in the design, development, management and promotion of staff development strategies and systems within the corporate sector, including construction, coal seam gas, mining, healthcare, hospitality and asset management, telecommunications and electrical industries.

For me, the resource industry represents: Opportunities for great project management. Multiple industries working together creating legacies for future generations.

My work with AMMA involves: Two key functions: business development for the AMMA Skills Connect suite of training services and project management for the government-funded workforce skilling project aimed at attracting and skilling workers for the resources, related construction and allied industries.

The greatest challenge of my work is: Juggling extensive project deliverables with many stakeholders to meet time-based outcomes while establishing and maintaining industry relationships.

The thing I love about my job is: Meeting new people and learning about different aspects of the resources, related construction and allied services industries.

My colleagues think I am: Short!

You wouldn’t know it but: I was one of the original cheerleaders for the Brisbane Bullets basketball team from 1986 to 1988, when they moved from the Sleeman Sports Centre to the Brisbane Entertainment Centre.

My alternative career choice would be: Interior designer.

If I could be anywhere else in the world it would be: Anywhere that is warm and has a beautiful beach.

I couldn’t live without: My husband Rob and my nine-year-old daughter, Lucy.

I’m inspired by: Humble heroes.

The perfect day/night out involves: A day at the beach followed by a glass of wine overlooking the beach while feeling slightly sunburnt.

I would spend my last $100 on: A good mascara.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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MEMBER FEATURE

Future focus Transfield Services’ greatest asset Transfield Services has forged a reputation as a leading asset management and energy and mining services contractor. Here, Joe Sofra discusses how strategies for emerging markets and shifting conditions have set its resources and energy division on an ‘enticing’ growth pathway.

IN an industry where his customers’ needs are defined by cyclical periods of investment and production, Joe Sofra believes in a long-term focus for supporting client assets and building value.

But that’s not to say the chief executive of Transfield Services’ resources and energy business isn’t looking to seize more immediate opportunities.

Maintaining the energy and mining service provider’s competitive edge, he says, requires constant innovation in service delivery, a multifaceted approach to asset management and keeping a keen eye on emerging markets.

“We’re very much a long-term focused contractor and we go into new customer relationships with the view that we want to be working with them for the next five, 10 and 15 years,” says Sofra.

“But we are coming off a once-in-a-generation level of investment activity and the parameters in which Transfield Services and our customers are operating are rapidly changing.

“The same solution that worked three years ago is not going to work in three years’ time. This requires us to think about how we can best position ourselves to support our customers, which means we really need to be in tune with their critical business objectives.

“If we lose sight of that, we lose the ability to innovate and deliver a differentiated service.”

Transfield specialises in delivering site-wide maintenance, well and operations services, particularly to sustain the productivity of clients’ assets during the full operational lifecycle.

The company employs more than 24,000 people across 20 industries and 11 countries. Like the entire group, Sofra prides the resources and energy business on both its technical expertise and understanding of clients’ overall business goals.

With its mineral mining activities diversified and including BHP, Xstrata and Fortescue Metals as key clients, its hydrocarbons customer base is likewise diverse – and growing.

In late 2012, Transfield Services was awarded a five-year, $200 million contract for asset maintenance and operations services on the QGC Curtis Island LNG Project. The work covers processing plants, compression stations, about 2,000 gas wells and connecting infrastructure.

The operational contract came a month after Transfield won an $80 million construction contract for the QGC project through its 50/50 JV with Clough Limited.

Targeting emerging hydrocarbons sectors appears to be a diversification strategy to protect Transfield Services from cyclical commodity price fluctuations, but Sofra insists he does not buy into recent political and media commentary about the

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‘end of the mining boom’.

“Sectors like iron ore are coming off a ‘boom cycle’ in terms of new capital but there is a heavy investment base and still strong global demand for iron ore and steel, so while we certainly see sector adjustments as assets are sweated even harder, we can’t see the sector going into a downturn,” he says.

“I would describe the minerals sector as an ongoing sustainable operating environment, but we are also very excited about the emergence of the coal seam gas sector.

“It’s an enormous industry that is developing from what was close to a zero base in a very short space of time and it’s certainly one of our key growth areas.

“The sector feels like a good fit and we have some unique offerings in key areas including well drilling, servicing, completions and more traditional asset support services of project delivery, construction and maintenance.”

Shutdown expertise Across both minerals and energy production assets, Transfield Services is renowned as a master of complex project shutdown activities.

Sofra describes shutdowns as an intense campaign of construction, maintenance and upgrade works when a plant comes off its production cycle.

Transfield Services’ human resources capacity boasts qualified and productive people with great experience on shutdown

Joe Sofra Transfield Services CEO – Resources and Energy

MEMBER FEATURE

services, though just as much emphasis is put on managing client anxieties.

“Shutdowns make people feel incredibly nervous and uncomfortable. Every minute, hour and day the asset is offline and not producing is impacting the customer’s bottom line,” says Sofra.

“The typical shutdown process begins a long time before execution. Detailed planning and preparation for a 30-day major industrial or LNG plant shutdown will have started 12 to 18 months in advance.

“When you begin the shutdown execution, it’s a militarystyle operation. You’ve got a central headquarters, people are clear about what they have to do and the operator is clear about how they need to support the activity.

“It’s very well-orchestrated and we put a lot of effort into getting it right because it’s critically important.”

When it comes to recruitment of the often hundreds of people required to deliver a shutdown, Transfield Services’ strategy is multifaceted.

“Any one shutdown requires a large group of people to work on planning and preparation to execution and we maintain a strong network of supervisors, planners, project managers and engineers to utilise as we get closer to those key mobilisation periods,” says Sofra.

“We also maintain an extensive database across the country of trades-based personnel who are shutdown and assetcapable, including extensive LNG knowledge.

“Crucially, we are constantly looking ahead to ensure what we are doing is optimising our resourcing requirements and that we’re always retaining that core workforce capability. We don’t let that exit the business.”

Safety Culture Almost two years ago, Transfield Services introduced its “10 Million Challenge” as a new vision for workplace safety across its global portfolio.

The challenge aims to achieve 10 million working hours without any lost time injuries and has so far succeeded in reducing the company’s total recordable injury frequency rate by 17%.

With the group’s managing director and CEO Graeme Hunt personally driving the safety mantra, Sofra ensures the energy

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and mining business he leads is a standout performer.

“Coming in as the new resources chief executive, I wanted to ensure we can only ever be satisfied with zero injuries. We should always be looking for ways to improve because there’s always something more innovative we can do,” says Sofra.

“The 10 Million Challenge has helped to keep safety front of mind, regardless of roles, industry or location. Our people know what they need to do to have a good safety day where nobody gets hurt and everyone goes home the way they came.

“A big part of this is encouraging self-leadership among our supervisors and crew leaders to ensure their teams are engaged, they understand what the risks are, they lead by example and there is a good line of communication.

“And it’s not just about protecting our own folks but also influencing the way our clients and sub-contractors operate on site so that safety performance increases collectively.”

Becoming the ‘outcome contractor’ Sofra is pleased with the direction the resources and energy division is heading since he took the helm a year ago, but unsurprisingly sees plenty of room for improvement.

Reiterating the focus on expanding the company’s footprint in conventional and emerging hydrocarbon areas, he also notes better servicing the minerals sector is a critical strategy as market conditions shift.

“Certainly a big piece for me is about having that clarity of strategy and a value proposition to service those sectors moving forward, particularly given how rapid the market change has been and how quickly people are reacting to that,” he says.

“Another key strategy is looking at the commercial arrangements we have with our customers and recognising that being predominately a reimbursable contractor is probably less relevant to the changing commercial environment.

“We’re very much moving our whole commercial arrangement away from being a commodity provider of service to becoming far more a solution provider of service. We call it ‘outcome contracting’, if you like.

“I guess I’m bullish in what I see coming forward. If I stretch my horizon beyond the three feet in front of me and think about the five years to come, it feels like quite an enticing period.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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LEADERSHIP

Big challenges for Macfarlane in familiar role The Abbott Government’s Minister for Industry Ian Macfarlane is a familiar figure for many AMMA members, having held the resources portfolio under John Howard for six years. Speaking to Resource People, it is clear the Queensland ex-farmer brings passion, experience and vision back to his old post.

CIRCUMSTANCES in Australia’s resource industry have changed dramatically since Ian Macfarlane was last the Minister for Resources.

When Macfarlane lost his ministerial role in the 2007 Rudd election victory, he left the sector well on its way to what would be another half decade of record new project investment, soaring commodity prices and 25% year-on-year employment growth.

However, regaining his resources responsibility under the ‘Industry’ portfolio in 2013, he faces the challenge of helping the industry turn around a year of stagnation where confidence is down, growth is slowing and international investment interest is looking elsewhere.

“The biggest thing I’m looking forward to is getting the sector going again,” says Macfarlane, who has been the Member for Groom in Queensland’s Darling Downs region since 1998.

“We will make sure the ‘vitamin C’ that has been missing from the industry over the last few years – confidence – is reinjected into the industry.

“Not only do people in Australia need to have the confidence to invest, but internationally we will send the message that the shop is under new management and we want to see our resource industry growing again with confidence.”

Macfarlane attacks the former Labor Government’s track record on ‘choking both big and small business’ with the carbon and mining taxes and vows to reverse the impact of ‘21,000 new regulations introduced over six years’.

However, in an industry he has great passion for, his biggest disappointment with the prior government is the class war rhetoric and vilification of the resource sector that marred its latter months.

“Tony Abbott wants Australians to be proud of the mining industry like we’re proud of our farmers, like we’re proud of our innovators and like we’re proud of our educators. Australia should be proud of an industry that is a cornerstone of our economy,” says Macfarlane.

“I totally agree with that view, and there are plenty of reasons

Minister for Industry Ian Macfarlane (left)

www.amma.org.au | Spring ‘13 – Summer ‘14 |

to be proud.

“I want to see everyone benefit from the mining industry just as much as I want to see the small businesses in Toowoomba that support the sector remain strong. Those things won’t happen if you’re taxing it and berating it and changing the rules all the time.”

Early in the final week of the election campaign the Coalition released its policy for resources and energy focusing on cutting taxation and regulatory red-tape, kick-starting the next phase of exploration activity and better managing coal seam gas policy and oil and gas retention leases.

Specifically, the government’s $100 million Exploration Development Incentive (EDI) scheme will allow investors to deduct the expense of mining exploration against their taxable income, starting on 1 July 2014.

“The challenge for us now is to kick-start the industry, and that’s very much what the EDI is all about,” says Macfarlane.

“Exploration is the R&D of the resources industry and when your R&D stops the industry automatically goes into decline.

“We are sending a clear, unambiguous message to the mining industry that we want to see exploration kick-started, we want to see new deposits discovered and we want to see new mines developed.

“It takes 10 years at least from the time a deposit is discovered to get them up and running and this is why supporting exploration activity is so vital to the sector’s future.

“Another challenge is getting the resource industry to coexist better with farming, which is something I look forward to working on because resources and farming are both passions of mine.”

In a move designed to deliver certainty and confidence to the sector, Macfarlane has also begun working on an updated version of the Rudd-Gillard Government’s energy white paper.

He says it will be ready for release within a year and will focus on industry consultation as well as investigate the role of alternative transport fuel sources including biofuels, LNG, CNG and LPG. Most importantly, the Abbott Government is already demonstrating a greater understanding of the true breadth and value of Australia’s resource industry to the national wellbeing.

The former Darling Downs farmer appears back where he belongs and is tackling the current crop of challenges head-on.

“The Coalition supports a vibrant and competitive resources and energy sector, recognising the enormous benefits the sector delivers and its vital contribution to our national economy,” says Macfarlane.

“We believe in this industry and are consulting with industry and implementing our comprehensive policy plan as urgently as possible to encourage new investment and stimulate growth.”

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AFL legend’s leadership centre takes shape Michael Long may be one of the Northern Territory’s greatest AFL legends, but these days the sport is his catalyst for improving education and employment among Indigenous youth.

WHEN it opens its doors in mid-2014, the Michael Long Learning and Leadership Centre will instantly provide an education and sporting hub with facilities and services previously unavailable in the Northern Territory.

Located at TIO Stadium in Darwin, the centre is an extension of the AFL’s program to harness the popularity of football to engage Indigenous youth and introduce them to education and employment opportunities.

As its namesake, Long describes the construction of the centre as a realisation of a ‘dream’ and says it will become one of the most important educational facilities in the Northern Territory.

“The quality of life for Indigenous communities must improve and improve fast,” says Long.

“Education is the key. Without education the situation will remain unchanged and young Indigenous Territorians will not prosper and grow.

“Leadership is critical. Without strong leaders entire communities will continue to be blighted by chronic social dysfunction and third-world living conditions.

“I am confident that the Michael Long Learning and Leadership Centre will produce the leaders of tomorrow by engaging them in a suite of football-themed educational modules in a safe, culturally appropriate environment.”

Famed as a courageous advocate for Indigenous rights, Long’s stand against racial vilification in football led to the introduction of a racial abuse code in the 1990s.

In 2004 he completed what is now known as ‘the long walk’ from Melbourne to Canberra to bring his concerns about the plight of the Indigenous to the attention of Prime Minister John Howard.

Michael Long

As his latest endeavour, Long says the Learning and Leadership Centre comes at a time when Indigenous attendance at Northern Territory schools is as low as 15% and numeracy and literacy levels show no signs of improvement.

“Football is part of the long term solution but ultimately it is education that will help young Indigenous Territorians succeed in life,” he says.

“If you are unable to read or write, your chances of succeeding in life, no matter what path you choose, are nonexistent. Generations of young Indigenous Territorians don’t stand a chance of becoming the people they deserve to be.”

Long says the centre provides and important link between industries such as resources and the next generation of working Indigenous Australians.

“The relationship between the resource industry and Indigenous Territorians has often been an uneasy one but, like all relationships, honesty, transparency and frank discussion has gone a long way to improving this important relationship.”

The Michael Long Learning and Leadership Centre will house a gym and swimming facilities, offices, lecture theatres and break-out rooms.

A residential component consisting of 90 beds will accommodate children visiting from remote areas.

The Michael Long Learning and Leadership Centre

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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LEADERSHIP

ACCI urges Coalition to ‘get on’ with reform blueprint Australia’s business community has urged the Coalition to adopt five priorities for national reform as one of its first activities in federal government.

The Australian Chamber of Commerce and Industry’s (ACCI) blueprint ‘Getting on with Business: Reform Priorities for the Next Australian Government’ focuses on: • a stronger economy; • raising productivity and

competitiveness; PETER • accessing global markets; ANDERSON • better functioning institutions and • supporting small business.

“Getting on with business both literally and figuratively involves changes to policy and the way governments interact with the private sector,” says ACCI chief executive Peter Anderson.

“It’s hard work, but not impossible because the instinct of private businesses and private individuals is to grow new wealth and employ more people, so long as they are backed-

in by their governments.

“Economic management and creating new national wealth to pay the bills we are racking is the number one task of the government.

“ACCI’s five national priorities are developed by industry and there are literally 101 ideas in the blueprint on how they can be achieved.

“Quite deliberately, supporting small business is a top priority because two million small businesses creating half our national output and employing seven million Australians is, in the words of our election-year message, ‘Too Big To Ignore’.”

Some of the specific recommendations in the blueprint include: lower and better targeted taxes; tertiary education spending linked to industry skill needs; changes to the Fair Work Act; realistic penalty rates in service industries; restoration of employer incentives for offering apprenticeships; and a review of future superannuation levy rises.

A quick word with clive palmer CLIVE Palmer’s ambitious tilt at Prime Ministership brought great scrutiny and personal attacks on the gregarious mining identity, but regardless of your personal view, the Palmer United Party founder offered up his finances and reputation in the interests of keeping the clive major parties on their toes. palmer So what’s the man who injected great colour into the 2013 campaign actually like? Resource People got a little insight when we caught up with Clive for a quick word.

Why did you launch Palmer United and take a shot at the 2013 election?

“We launched the Palmer United Party with full intentions to be the next government of Australia. Australian politics has become very boring and our country needs a genuine alternative that doesn’t waste taxpayers’ money and is attuned to the changing needs of the nation.”

What has been your most satisfying achievement to date?

“I am proud of the businesses we operate in areas ranging from resources to tourism, which employ several thousand people around the country. I take pride in the success of operations

www.amma.org.au | Spring ‘13 – Summer ‘14 |

such as Yabulu nickel refinery near Townsville. BHP was going to close the plant before we bought it, but a strong commitment and tireless work from all staff made the plant a success once again. It was one of the highlights of my business career to reward those hard-working staff members with Mercedes Benz cars and overseas holidays.”

What do you think the future holds in terms of jobs and growth in Australia?

“I believe in building competitive enterprise through breaking down centralised controls that have held back productivity.

Australia’s best strategy for jobs and prosperity includes responsible fiscal management and industry policy that maximises Australia’s global competitive advantage and minimises the regulatory burden on business.”

Who have been your role models or mentors?

“I greatly admire John F. Kennedy and have been fortunate to have made connections with the Kennedy family, including the late Senator Edward Kennedy. I’ve also been fortunate to have had many mentors starting with my late father George. Later I was privileged to work on election campaigns with Sir Joh Bjelke-Petersen, who was Queensland’s longest serving, and, in my opinion, a great premier.”

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POLICY

Coalition policy score: where do they stack up?

With productivity and flexibility more crucial than ever to doing business in the Australian resource industry, we look at how the new Coalition Government’s policies stack up.

THE resource industry has a significant interest in ensuring Australia’s workplace framework provides maximum flexibility, optimal productivity and imposes a balanced regulatory burden on businesses seeking to respond quickly to changing markets and global demand.

So how do the policies of the new Coalition Government stack up to this challenge? AMMA’s executive director industry Scott Barklamb, says Prime Minister Tony Abbott’s team is clearly headed in the right direction, albeit with work to do in some areas.

“The Coalition’s workplace policies are a significant step in the right direction to address the triple threat to our international competitiveness - unsustainable wage escalations,

a combative labour environment, and declining productivity,” Mr Barklamb says.

“A modern workplace relations system must provide employers and employees with the capacity to determine the working arrangements that best suit their needs. We look forward to working closely with the Abbott Government to get Australia’s workplace framework up to speed.”

AMMA has analysed and scored the Coalition’s policies across 10 criteria in its Election Year Policy Scorecard. The result - a satisfactory 29 from a possible 40 (73%). So where are the strengths and weaknesses? Read on.

National regulatory framework/regulatory burden A single national workplace relations system, without the duplication and complexity resulting from the interaction of six states, two territories and a federal system is a prime requirement of a modern industrial relations system. The Coalition has acknowledged the importance of reducing the WR regulatory burden and supports some changes that will have a positive effect. Score: 3.5/4

Minimum standards and awards The Coalition did not oppose Labor’s mid-2013 overreach of employee rights to request flexible working arrangements, and its boosted paid parental leave scheme will impose a new tax on business to foot the bill.

However, the Coalition’s policy provides long-awaited clarity about annual leave loading upon termination of employment which AMMA welcomes. Score: 3/4

Agreement making Industry needs a far broader range of agreement-making options including collective agreements, new project (‘greenfield’) agreements and individual agreements, with a duration of up to five years. The Coalition’s fixes to new project agreements are heading in the right direction, however their policy does not do enough to ensure there is a workable form of individual agreement. Score: 2.5/4

Agreement processing The Fair Work Act’s agreement processing is vulnerable to delays depending on the number of agreements lodged, the review mechanism and the resources allocated by the federal tribunal for that function. A simple administrative process is needed and the Coalition’s policy supports two recommendations that would move towards this, including a workable better-off-overall-test (BOOT) for agreement approval. Score: 3.5/4

Industrial action and compliance Australia’s workplace relations laws should prohibit the taking of industrial action during the life of an agreement and provide readily accessible remedies to prevent or stop the taking of unlawful industrial action along with the capacity to seek compensation. The Coalition’s policy addresses some needs of the resource industry by reestablishing the Australian Building and Construction Commission (ABCC) regulator, both onshore and offshore, and tightening the conditions under which protected action ballots can be approved by the Commission. Score: 3/4

Unfair dismissal/general protections AMMA believes there should be a single unfair/unlawful dismissal system with exemptions for probationary employees and high-income earners. Such a system would confine remedies to the merits of the case and protect employers from vexatious and frivolous claims.

Unfortunately, the Coalition’s policy will do little to repair the damage that Labor has done in this area, by supporting a new jurisdiction for workplace bullying within the Fair Work Commission and doing nothing to overhaul the existing adverse action provisions. Score: 2/4

www.amma.org.au | Spring ‘13 – Summer ‘14 |

POLICY

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Union entry into workplaces and access to records Union access to worksites and employee records must be balanced and controlled. Employers deserve a system where under a single national law unions can only access sites for discussion purposes where they have a current or historical connection to a worksite via a workplace agreement or award. The Coalition’s policy on union access to workplaces comes very close to meeting resource industry needs by seeking to restore the pre2009 right of entry system. Score: 3.5/4

Impact on productivity Australia’s workplace relations system must foster productivity by being as flexible as possible and putting productivity on the agenda in enterprise bargaining and agreement making. The Coalition’s score in this area is only slightly ahead of Labor’s given that its policy at least directly addresses productivity issues. Tasking the Productivity Commission with a thorough review of the Fair Work laws is an important initiative and could see the Coalition deliver a more productive system. Score: 2/4

Independence of the industrial tribunal During Labor’s six years in parliament, two-thirds of appointments to Fair Work Australia were from a union or Labor-affiliated background. To ensure the independence of the tribunal, further appointments should be based on merit and not favour one side of politics over another. The Coalition is considering a jurisdiction within the tribunal where appeals of decisions can be heard independently. Score: 2.5/4

Accountability of registered organisations AMMA is incorporated with the Australian Securities and Investments Commission (ASIC) and is of the view that all registered organisations (both unions and employer groups) should be subject to the same processes, rules and penalties applying to corporations rather than receiving special treatment. The Coalition has proposed significant reforms in this area including introducing the same rules for unions and employer organisations as apply to companies and directors, but keeping separate legislation rather than using the Corporations Law. Score: 3.5/4

Six key challenges Labor left for the Coalition NEW employment minister Eric Abetz inherits a policy framework marred by six years of broken promises to the business community and Labor imposing unions and excessive regulation between employers and employees.

Here are the top six priorities, as Eric abetz identified by the resource industry, for new employment minister Senator Eric Abetz to address in order to restore confidence in the workplace system.

1) Urgently address the aspects of the current bargaining system which have seen premature and damaging industrial action become a hallmark of the current framework.

2) Reform the scope and number of allowable matters in agreements and bargaining for simpler, more flexible and productive agreement-making.

3) Create a system where employers can make ‘greenfield’ agreements for new projects in a timely fashion and have a

safety valve in the event that unions refuse to negotiate.

4) Revise the foundation for individual flexibility arrangements (IFAs) to create genuine scope for flexibility in the workplace.

5) Better regulate union access to workplaces, reverse Labor’s most recent changes that will open up lunch rooms and remote sites to unions, and return union entry rules to those that existed prior to 2009.

6) Remove the Fair Work Act’s adverse action provisions entirely or, at the very least, enact targeted changes to stop adverse action being used to bring frivolous claims and unjustified actions against employers.

In addition to these six priorities, the Coalition should urgently progress its promise to restore the Australian Building & Construction Commission (ABCC) with all its full former powers and legislative backing, ensuring the rule of law is extended to offshore construction sites as well as onshore projects.

Key changes in this area will be bringing penalties for breaches of the law back up to what they were, after the Labor government reduced penalties by two-thirds and weakened their deterrent value.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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POLICY

Know your obligations and risks under new bullying framework Big changes to how workplace bullying is regulated and investigated in Australia come into effect in 2014 and AMMA’s specialists say being prepared with the right policies and processes will help protect your business’ exposure.

THE latter half of 2013 has seen significant changes developed and passed into law that will mean Australian businesses are facing a greater level of regulation in this area than ever before and greater obligations to proactively manage bullying in their workplaces.

LISA The most hotly-contested development is MATTHEWS the new jurisdiction for the national industrial tribunal, the Fair Work Commission (FWC), which will be able to deal with complaints from workers who believe they have been bullied at work from 1 January next year.

The creation of this new jurisdiction under the workplace relations framework was opposed by employer representative groups including AMMA, saying instead it was a matter for regulators in the workplace health and safety area.

Giving the low threshold for accessing this new jurisdiction, AMMA also flagged its potential to encourage frivolous claims or claims about genuine performance management that should not be captured under the new bullying framework.

In some instances employers may be encouraged to settle matters by paying ‘go-away money’.

AMMA senior workplace policy adviser Lisa Matthews says having the policies and internal reporting systems in place will help employers manage their liabilities in this area.

“Resource employers take workplace bullying extremely seriously, however, there are concerns that these new measures could overlap and undermine employers’ own investigations, as well as the types of claims that be brought before the commission,” says Matthews.

“There also remains uncertainty as to how this industrial jurisdiction will operate and intersect with other anti-bullying measures under Australia’s OHS jurisdiction. One thing that is clear is that employers face significantly increased regulation, obligations and potential liabilities.

“One positive note is that AMMA’s lobbying on the issue has seen the Coalition Government promise to explicitly include bullying by unions in the new jurisdiction, while it is also planning to introduce new requirements for employees to meet before they can take claims to the commission.”

Another big concern for employers, according to Matthews, is a proposed new national code of practice for Preventing and Responding to Workplace Bullying which is likely to be www.amma.org.au | Spring ‘13 – Summer ‘14 |

adopted in most states around the same time as the FWC’s new jurisdiction takes effect.

“AMMA urged Safe Work Australia to adopt the information as guidance material rather than a code, which could be used in legal proceedings against employers,” says Matthews.

“However at this stage, we expect all states other than Victoria will adopt this national code once finalised in the coming months.

“As the document stands in its current draft form, it would be extremely difficult for employers to comply with all the requirements, which in AMMA’s view go further than what the work health and safety legislation warrants.”

AMMA’s director of legal services, Amanda Cochrane, says it is vital for employers to prepare for this new two-fold regime, also keeping in mind they have obligations under state and federal anti-discrimination laws in relation to workplace bullying.

To both minimise exposure to complaints in the first instance and then manage them if they are received, she says employers must ensure they have adequate policies and procedures covering the new developments, communicate these policies and all internal processes to staff, and ensure they know who the key contact points are for raising issues.

“Many employers have policies called ‘discrimination, bullying and harassment’, which incorporates workplace bullying. That is fine as long as you check they are updated to reflect these latest legislative changes,” says Cochrane.

“If you don’t have a policy that adequately covers workplace bullying, you will need to implement one that is reasonably comprehensive and ideally give examples of behaviour that you consider to be workplace bullying as well as examples of what is not considered workplace bullying, to avoid confusion.

“Once your policies are updated, you’ll need to communicate them again to all staff, ideally both verbally and in writing given that English may not be the first language of some of your employees. The final step is to provide regular refresher training in your policies. AMMA can assist you in all of these areas if required.

“Once you have strong procedures and policies in place, you must ensure you take immediate action if a complaint is received, and ensure you fulfil your number one duty of care to provide a safe and bully-free workplace for your staff.”

For advice about how to protect your business, comply with new bullying obligations and understand how to navigate Fair Work Commission processes, Cochrane can be contacted via your local AMMA office.

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policy at a glance A wrap-up of recent resource industry policy activity by AMMA executive director, industry, Scott Barklamb.

Productivity Commission review The Coalition Government has indicated it will undertake a Productivity Commission-led review of Australia’s workplace laws, the Fair Work Act. AMMA will build on its close working relationship with Prime Minister Tony Abbott and his government to ensure our members’ concerns are appropriately represented both in the scope of the review and the evidence provided to support change.

RMIT Workplace Relations Research Project The sixth and final edition of The AMMA Workplace Relations Research Project has been published on AMMA’s website. This series of six-monthly surveys was conducted by RMIT University and analysed the workplace relations environment for AMMA members in the resource industry, providing an integral body of research for AMMA’s policy and lobbying activities. Findings from the latest report include that over-regulation of workplace relations has created a costly, time-consuming and unproductive framework for doing business and employing people. The full scope of results covers feedback on industrial action, union site access, wages, workplace flexibility, enterprise bargaining and engagement with the workforce. Thank you to all participating members.

New maritime regulation A raft of amendments to primary legislation, regulations and Marine Orders have been put in place, many of which are to implement the International Labour Organisation’s Maritime Labour Convention, 2006, and other international obligations.

Revision and redrafting of Marine Orders, for example, will continue into 2014 and AMMA will continue to make submissions seeking to influence this process. For information about the commencement and practical effect of the legislative changes contact Julie Copley in our policy team.

Offshore migration zone extended The Migration Amendment (Offshore Resources Activities) Act 2013 (Cth) will commence in 2014, deeming all people operating in support of offshore resources activities to be in an extended Australian migration zone and needing working visas.

AMMA has provided clear evidence that the legislation is illfounded and inconsistent with other nations and we are working at all levels with the new government to ensure its repeal. Prior to this we are working to shape the new visa requirements and be able to advise members accordingly.

Policy paper on union access to workplaces In the first of a series of Resource Industry Workplace Relations Papers, AMMA has released its paper Trade union access to workplaces. The paper provides a comprehensive review of the Fair Work Act’s ‘right of entry’ system backed by facts, evidence and independent research into resource industry employers’ experiences under the current rules. This paper will shortly be followed up by the release of two other papers in the series

SCOTT BARKLAMB EXECUTIVE DIRECTOR, INDUSTRY, AMMA on Greenfield (new project) agreements and Adverse Action / General Protections.

CFMEU vs Mammoet Australia Pty Ltd The High Court has unanimously allowed an appeal from the decision of the Federal Court of Australia in CFMEU v Mammoet Australia Pty Ltd. The matter relates to industrial action on Woodside’s Pluto Project in April 2010 where originally, the Federal Magistrates Court found providing accommodation to striking workers was prohibited because it constituted ‘strike pay’ and the employer was right to withdraw it. In 2012, the Federal Court upheld this decision after the CFMEU appealed, however the High Court has now set aside both earlier decisions and remitted the matter back to the Federal Circuit Court to be determined afresh. AMMA’s legal team can advise you on implications for your operations.

Submission on labour mobility AMMA has made a submission to the Productivity Commission’s study into labour mobility, highlighting that it is vital for policy makers to take a realistic and pragmatic look at the complex challenges associated with domestic labour mobility. We argued that understanding the real-world challenges associated with labour mobility will generate sensible and practical policy making that takes into account the necessity and benefits of supplementary labour sources while at the same time seeking to ensure the local population is as highly and relevantly-skilled as possible. This submission can be read on AMMA’s website.

AMMA’s policy specialists, employee consultants and legal professionals are best placed to advise you on how any of these policy developments may impact your operations. Contact your local AMMA office via www.amma.org.au.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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MIGRATION

New immigration minister to look at onerous 457 changes No longer in the shadow cabinet, new Minister for Immigration and Citizenship Scott Morrison has promised resource employers the Coalition Government will return certainty to Australia’s 457 visa program.

RESOURCE employers are hopeful new Minister for Immigration and Citizenship Scott Morrison will act on his pre-election promise to restore business confidence in Australia’s skilled migration program.

Speaking at the AMMA Brisbane Migration Forum ahead of the federal election, thenSCOTT shadow minister Morrison said Labor’s MORRISON legislative changes to the 457 visa program were threatening the viability of $350 billion worth of projects yet to come to market.

“Labor’s attack on skilled migration through the measures introduced to choke the 457 visa program with union red tape was nothing more than economic vandalism,” Mr Morrison said.

“The innovation, commitment, skills and application shown in this sector is a leader to the rest of the economy and one we want to encourage and support because we are all the beneficiaries.

“Australia’s competitiveness on a global stage is slipping, business is competing for a pool of global capital and currently

there is a real risk of being overlooked because of the perception we are high cost and low productivity.

“If this continues, projects worth billions of dollars, not to mention the thousands of jobs that go with them, will only move in one direction – offshore.

“We need to be tight when it comes to the enforcement of the regulations, but fixing those problems doesn’t require more regulation.”

“The Coalition believes in a well run migration program that focuses on skills and creates jobs for Australians.”

Labor’s raft of changes followed union campaigns against ‘rampant abuse’ of the 457 visa system and included the reintroduction of onerous labour market testing, stricter English language requirements and more than doubling of the $455 visa application fee to $1035.

AMMA chief executive Steve Knott urged the government to send a clear message to the global business community that Australia’s resource employers would have access to a skilled migration program that responded to commercial needs.

Wrap-up of Labor’s last migration changes

jules pedrosa

AMMA migration services manager Jules Pedrosa reviews Migration Act amendments passed through the last sitting week of the Rudd Government, including the introduction of labour market testing and changes to the 457 visa program.

Until new Minister for Immigration

Scott Morrison reviews and puts forth the Coalition’s changes to the Migration Act (see above article), resource industry employers will need to know how the previous Labor Government’s amendments affect them.

Labour market testing (with some exemptions): A labour market testing (LMT) requirement for the 457 visa program is due to take effect on 1 January 2014. Under LMT, employers must provide details of job advertising (paid or unpaid) and relevant expenses paid (or payable) for that advertising in their 457 application. This applies to all engineers and trade and technical roles.

www.amma.org.au | Spring ‘13 – Summer ‘14 |

FWO inspectors: Greater scrutiny should also be expected as Fair Work inspectors have greater powers to monitor and enforce employer compliance with 457 visa obligations. These powers include undertaking worksite inspections, interviewing employees and requesting pay slips and other records from employers.

Increase in fees: On top of the existing doubling of fees from $455 to $900, additional fees for the ‘dependants’ of the primary visa holders have also been introduced – $900 for dependants over age 18 and $225 for dependants under age 18.

More time to renew sponsorship: The bill also extends from 28 to 90 consecutive days the period in which 457 visa holders can seek new sponsors after the termination of their job.

Sponsorship obligations: The bill enshrines into law increased market rates threshold (from $180,000 to $250,000); stricter English language requirements; the requirement for ongoing demonstration of training; and new restrictions for on-hire arrangements.

A range of additional regulatory changes and costs, were introduced by the amendment bill earlier this year, contact AMMA Migration services for more information.

MIGRATION

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457 visa program effective, says Migration Council A wide-ranging study into Australia’s 457 visa program reveals both employers and skilled migrant workers were satisfied with the scheme prior to the Labor Government’s recent amendments which included tighter labour market testing and increased application fees.

The Migration Council of Australia (MCA) report, More Than Temporary: Australia’s 457 visa program also found that 457 visa workers are critical to keeping Australia competitive in an era where 98% of innovation happens internationally.

“The 457 visa program has become a critical part of the economic toolkit. It was deliberately designed to respond to skills shortages, but the other function was to connect Australia to international development,” says MCA CEO Carla Wilshire.

“In order to secure a foothold in innovation break-throughs, access new knowledge frameworks and keep abreast of technology in different sectors, we need to have mechanisms that can rapidly connect us to other parts of the world.”

Wilshire says the MCA survey of 3,800 visa holders and 1,600 businesses debunks the myth that 457 visa workers are not contributing to Australia’s permanent skills capacity and are

negatively impacting training and workforce planning.

“The one-way negative effect on training was not evident at all; what we saw was a positive correlation between temporary migration and the development of human capital of Australia,” she says.

“About 76% of 457 workers said they helped train or develop other workers. That increased with firm size with four out of five multinational companies specifically using 457 visa holders to train their Australian workforce.”

The survey also found that 88% of 457 visa holders were satisfied or very satisfied with their employers and 85% of employers were either satisfied or very satisfied with the program.

Wilshire says the survey results do not support the federal government’s case for wide-ranging reform to the scheme.

“Employers are using the program as they are intended to.

It is a well functioning program that needs to be constantly monitored, but it is not out of control,” she says.

“The way some elements of the debate were handled would have had quite a negative impact on global perceptions and also the sense of belonging that migrant workers have.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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OHS & WELLBEING

Making tracks against kidney disease Diamond Protection has proven to be a cut above when delivering hard-line security, emergency and training solutions for the resource industry, but the company recently swapped its uniforms for race suits as it made tracks against childhood kidney disease.

Sporting a souped-up 1974 Holden Kingswood complete with a new V8 motor and roll cage, managing director Julian Smith joined more than 60 fellow contestants on a 4,500km bush rally to raise much-needed funds for Kidney Health Australia’s Kidney Kids program.

The flag dropped in Tamworth and over the eight-day bash, the ‘Kidney Kars’ crossed all manner of Australia’s toughest terrain to pass a checkpoint in Bundaberg, before again turning south towards the Armidale finish line.

“Kidney disease affects more people than most realise, and the annual Kidney Kar Rally is a great measure to help kids living with, and affected by kidney disease,” says Smith.

“It’s a great cause and opportunity to connect with wonderful people from other competing cars, not to mention the opportunity to travel throughout Australia each year, take some time off work and raise money for the kids.”

Now a five-year veteran driver for Diamond Protection, Smith rates the 2013 rally a resounding success – especially compared to his second drive during which he rolled Diamond Protection’s first car, a rebuilt 4WD Toyota Hilux now know as ‘the Rollux’.

“Over the first three days the Diamond Protection team was sitting at equal second, which is a great result, but as with every year the rally is very unpredictable,” he says.

“On Day Four, we blew a rear shocker that needed attention from a bush mechanic, but I am pleased to say we didn’t roll

Diamond Protection’s V8 Kingswood named “Kar 1995”

www.amma.org.au | Spring ‘13 – Summer ‘14 |

three times on day one, as we did three years ago.”

Despite the delay, the Diamond Protection team placed 12th overall and raised more than $7,700 for Kidney Health Australia, making the ‘Kidney Kids’ the real winners.

“This rally is an amazing journey experiencing different parts of Australia, making life-long friends and raising funds for kids who need this kind of support,” Smith says.

“Funds raised through these rallies provide children with Kidney Health Australia’s Kidney Kids program the opportunity to meet others living with the same condition in a safe and fun environment while building self-confidence and providing respite.”

The rally also raises awareness for kidney disease as it progresses through New South Wales and Queensland. At each stop Kidney Health Australia takes to the streets of local towns and offers free kidney disease risk assessments.

“One in three Australians is at risk of kidney disease and yet kidney disease flies under the radar of awareness, because it has no warning signs,” says Kidney Health Australia chief executive Anne Wilson.

“But it is treatable if caught early, and we hope that every kilometre of the Kidney Kar Rally made one more person aware of their risk.”

In its 25th year, the 2013 Kidney Kar Rally raised a total of $620,000 to help support the Kidney Kids program in 2014.

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OHS & WELLBEING

Empowering healthy habits Aon Hewitt’s services cover the full spectrum of human resources solutions but according to its wellness specialist Danni Hocking, getting the best out of your people can be as simple as helping them stay fit and healthy.

Influenza is the most common reason for absenteeism in the workplace, causing an average of four days absence per employee each year, according to Deloitte research. While ‘the flu’ is certainly more prevalent in winter, employee wellness is a year-round issue.

DANNI Not only does an individual’s health HOCKING affect their wellbeing, it also influences their productivity, morale and ultimately the organisation’s profitability.

Here are some simple tips for demonstrating a commitment to employee health that your organisation can easily adopt: Fitness – encourage your employees to get up and moving Implementing a company-wide fitness program can have overwhelming benefits to your employees and your organisation.

Studies have shown that employees who exercise on a regular basis have increased job satisfaction, improved morale, reduced injuries and increased productivity. Plus, employees who are healthy and in shape have a lower risk of high blood pressure and lower their risk of developing high cholesterol.

Many companies get creative with their employee fitness programs. You could try engaging a personal trainer for the building; consulting with local gyms for corporate discounts; introducing after-hours yoga or pilates classes; or setting up a corporate massage program designed to reduce stress and boost workplace morale.

These types of programs don’t take up much room and need even less resources, but can be very beneficial to the physical and mental health of your employees.

Mental health – create an open and supportive environment for employees Addressing depression and other mental health disorders is an extremely important part of your employees’ overall health.

Beyond Blue research suggests that depression affects one in five people; with undiagnosed depression predicted to cost organisations about $9,660 in absence each year. Start creating a culture where it is ok to talk about mental health, without judgement.

Educate your managers on how to deal with employees who experience symptoms and communicate your commitment to helping those in need.

Diet and nutrition – encourage healthy habits Chamomile tea contains polyphenols that help increase antibacterial activity and prevent illness. It also has a calmative effect, minimising stress and boosting energy.

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What workplace wouldn’t benefit from less stress and more energy?

Providing herbal tea in the employee lunchroom doesn’t sound like cutting-edge human capital management, but this is just one example of how making small changes can make a big difference on the morale and general health of your workforce.

There are many low cost ways for an organisation to show its employees that their health and wellbeing is an ongoing priority.

Providing healthy food in the lunchrooms is a popular method for keeping employees healthy and engaged. Promote items that are high in vitamins, nutrients and minerals such as fruits and nuts.

Hydration is a key factor in optimal health. Making water readily available around your office will help your employees stay hydrated and healthy all year long. Ensuring your employees don’t have far to go for water can also discourage them from snacking on unhealthy drinks such as coffee or soda.

Committing to long-term wellness One of the most important elements to keeping your office healthy is to encourage employee self-care by empowering your staff to make decisions based on their own individual wellbeing.

Have you considered conducting health risk profiling for your employees? They will learn more about their own health profile and be more motivated to engage in healthy behaviours.

Aon Hewitt believes people are key to the success of any organisation. The health and wellbeing of employees directly impacts an organisation’s success as a workplace and as a business. A year round commitment to employee health and wellbeing can not only drive productivity by reducing absenteeism and presenteeism, but can increase employee engagement and make a real difference to your workplace.

Danni Hocking is principal – workforce risk solutions, wellness with Aon Hewitt.

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Sodexo fast tracks healthy lifestyles AFTER four years of development and offshore trials in the North Sea, foodservices and facilities management company Sodexo is preparing to launch a comprehensive health and wellbeing program in its Australian operations. The program supports Sodexo’s new positioning as a provider of ‘Quality of Life Services’.

The roll-out of ‘Well Track’ has commenced at South Australia’s Prominent Hill copper-gold site, where Sodexo manages the village facilities for OZ Minerals, and focuses on physical fitness activities and nutrition, supporting family communications and mental health and boosting workforce motivation for a healthier mining lifestyle.

Participants are given a comprehensive program to follow, combining exercise and diet with personal-motivation goals.

“Without a healthy, positive work environment, you’re faced with high absenteeism and presenteeism (present for work but mentally unfit for duty), accidents, productivity loss and major health care costs. It also makes retaining quality workers harder,” says Sodexo Australia’s marketing director Maria Kucherhan.

“At Sodexo, we’ve been studying this issue for many years.

Based on extensive analyses and consumer research, we’ve developed a unique, new value proposition; a results-driven offering designed to tackle wellness head on and yield

positive, quantifiable benefits.

“Instead of just hearing pep talks about why healthy habits are so important, Sodexo’s Well Track initiative provides workers with a dedicated coach to guide and support. Our wellness coaches assess, instruct, encourage and monitor participants both at work and at home as they strive to earn points and reap rewards.”

R&D for Well Track began at Scotland’s Aberdeen University in 2009 with the program first piloted by Sodexo on North Sea offshore platforms managed for Dolphin Drilling.

Prominent Hill marks the first onshore location to undertake the initiative, while expansion plans include Sodexo’s other remote sites across Australia and in the UK, Norway and Gulf of Mexico.

“Our local roll-out of Well Track has been complemented by a literature review conducted by Professor Kerry Carrington of the Queensland University of Technology,” Kucherhan says.

“The research focused on health challenges of the mining environment and lifestyle, the impact of wellness and well-being on the performance of mining workers, and the impacts of alcohol, tobacco and obesity on company productivity.”

Ensure you read the next edition of Resource People for an update on how Sodexo’s Well Track program is tracking at Prominent Hill.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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COVER STORY

Globally, Bechtel’s mining and metals business employs 50,000 people across 11 countries and turns over about $7 billion per annum. We’re running that out of Brisbane and taking Australia to the world – I’m pretty proud of that.

ANDY GREIG

People, projects, performance: 60 years of Bechtel in Australia

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President of Bechtel’s global mining business Andy Greig oversees $20bn of contracts and 50,000 employees across the world from his Brisbane office.

While constructing seven cutting-edge engineering projects in this country alone, the 32-year Bechtel veteran is most focused on developing his people and having a positive impact on local communities.

UNASSUMINGLY sitting just offshore the central Queensland industrial city of Gladstone, Curtis Island has been transformed into a bustling hub of worldclass engineering and construction activity as the processing and export facilities for three landmark LNG projects come to life.

Bechtel, a global leader in project management and one of the world’s largest privately owned companies, is designing and building all three projects with a combined construction value well north of $25 billion.

“On Curtis Island we have three mega-projects, all fixed price and side-by-side. That’s unprecedented in our 115 year history,” says Andy Greig, head of Bechtel’s global mining business and the company’s managing director for Australia.

“It is the largest concentration of work and risk in a single place that we’ve ever had, but the projects are going well. They’re executing to plan, they’re on budget and on schedule, and the safety performance by industry standards is outstanding.”

Now a fourth generation family-led global company, Bechtel set-up ‘down under’ in 1954 and is months away from its 60th anniversary in Australia.

Its Brisbane-headquartered mining and metals business covers 50,000 employees across 11 countries while locally, 12,600 people are employed on Bechtel’s diverse range of Australian projects.

“We have an interesting portfolio in Australia. On top of the three Queensland LNG projects we’re doing the EPCM on Wheatstone LNG, which is in the early stages but very much going to plan,” says Greig.

“In the mining business we’ve just completed five projects in the Bowen Basin for BMA. Those projects were all completed to cost and schedule and we have two more projects underway, one at Caval Ridge and the other at Hay Point.

“And since 1998 we’ve been continually expanding the Kooragang Island coal export facility in Newcastle for Port Waratah Coal Services.

“It’s really important when you execute major projects that you deliver predictably.

That involves getting the baseline right in having the right budget and schedule targets and then executing that to plan.

“Through this we can build the confidence of the people who make investment decisions for future projects. So the best thing we can do to stimulate more investment in Australia is to execute successfully.”

Productive people Born in Scotland but describing himself as an ‘adopted Aussie’, Greig joined Bechtel in 1981 as an industrial relations manager based in Gladstone.

His leadership philosophy is that ‘it is people who build projects’ as he strives to find the perfect match between technical expertise and providing an environment where Bechtel’s people can reach their potential.

“Hands-on industrial relations experience has equipped me well to lead a very large

organisation because rather than focus on the technical issues, I understand that the prerequisites for project success all start with people,” says Greig.

“My role is to provide strategic direction for the business and to ensure we have competence. That means having the right people in the right roles, creating the opportunity for people to be successful and providing motivation and recognition.

“Work is a combination of social and technical processes. Bechtel has the best technical people on the planet delivering the best technical solutions, so I focus on getting the social aspects right.

“I don’t care whether a person’s role is to weld, do the design drawings, run projects or fry eggs in the morning; if you create the right environment with the right structures, systems and processes, people will knock it out of the park.”

Greig’s IR background has also contributed to his view that ‘you get the productivity you deserve’. While acknowledging industrial instruments play an important role, he says the real key to having productive people is effective leadership and thoughtful engagement with the workforce. »

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COVER STORY

“The debate about productivity in Australia is an interesting one, but when we get it right Australia can be as good as anywhere in the world,” he says.

“People generally want to do good work. When recently completing the Yarwun 2 alumina refinery for Rio Tinto, our productivity in terms of how many job hours it takes to install a metre of pipe or a tonne of steel was at a record level.

“We had an excellent workforce which was there for a long time and the leadership, material flow, information flow and systems were all conducive for people to demonstrate their competence and their talent.”

Local legacies Bechtel’s Australian workforce is heavily concentrated in Gladstone as construction for the three Curtis Island LNG projects nears its peak. With 9,800 workers employed by Bechtel and its subcontractors in the region, controlling the impact of this level of activity on the local community is a top priority.

Admitting the company doesn’t always ‘get it perfect’, Greig is determined that Bechtel should leave a lasting, positive legacy on the community.

“Gladstone is a unique example where we’ve been there for 35 years, but major construction project work is generally itinerant – we move into a community, we build something and then we leave,” he says.

“It’s like being a guest in somebody’s home, so the single most important measure I use to gauge a project’s end success is whether or not that community would welcome us back.

“If the answer to that is yes, it

I don’t care whether a person’s role is to weld, do the design drawings, run projects or fry eggs in the morning; if you create the right environment with the right structures, systems and processes, people will knock it out of the park.

ANDY GREIG means you’ve listened to the concerns and expectations of the community, committed yourself to try to satisfy the aspirations of the community; and to mitigate the concerns of the community.”

A large part of this is communicating how work will be performed, however, with residents also expecting to see strong community benefits from large construction projects, the most important factors are local employment and local procurement opportunities.

“Wherever we have local skills I much prefer to employ locally than from other areas of the country, because it’s both cost effective and it meets the aspirations and expectations of the people from the community,” says Greig.

“So we employ locally first before expanding our scope regionally, statewide and then to the rest of Australia.

Of the 9,800 people working for Bechtel in Gladstone, 47% are Gladstone residents, 1500 are women and we are the largest employer of indigenous Australians in the region.

“We also invest massively in training, having trained about 9,000 people to date as steel fixers, concreters, plant operators, rigging, scaffolding, crane

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operators and so on. Currently we have about 250 apprentices on our payroll.”

Bechtel’s local procurement policy is to create opportunities for ‘appropriately qualified and skilful local businesses’ to participate in competitive supply chain processes.

“We have to be very careful with our clients’ money but local businesses should supply things that they are capable of supplying in a competitive environment,” says Greig.

“I can quote you on tonnes of steel and metres of pipe, but perhaps the simplest example are eggs. On Curtis Island we are buying 75,000 eggs a week and those eggs have to get there fresh, chilled and not broken.

“So local employment and local procurement is important in executing the work, but it also creates legacy when companies like ours complete construction and leave communities generally better off for us having been there, with skills and economic benefits.”

The final piece of the legacy puzzle is managing the interface of thousands of FIFO workers with the local community.

Around 5,000 members of Bechtel’s Gladstone workforce are non-locals and the

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Andy Greig on:

company invests heavily in extra-curricular activities for employees on their days off.

“We manage the activities of our fly-in workforce to ensure they interface with the community in an appropriate way,” says Greig.

“But the myth of the hard-drinking, carousing construction worker is a bit yesterday. The modern construction worker is more likely to get their iPad out and manage their investment portfolio than go drinking at the pub every night.”

Evolving Bechtel The marriage of technical expertise with family-owned company values of ethics, quality and safety has always underpinned Bechtel’s leadership mantra, both in Australia and globally. In the 32 years since Andy Greig joined the company, the biggest change has been an opening of the company’s public persona.

“Recently we’ve increased our profile.

We used to fly a little under the radar but now Bechtel in Australia employs 12,000 people, we are well known and more out there so we’re lifting our game in terms of engagement with media, government and communities,” says Greig.

“People expect engineering and construction excellence from a major E&C company but the thing that’s most important to me is the legacy work: not hurting people, doing our work to very high quality standards and having a positive impact.

“If the customer wants you to

do another project for them, if the communities will welcome you back and people want to come back and work for you – that’s what success looks like.”

Greig has lived and worked all over the world through Bechtel and is now overseeing arguably the most exciting operational period of its 60-year Australian history – but it is still the people stories that he comes back to on reflection.

“The thing I’ve enjoyed most is interfacing with people across many different cultures and seeing people develop and grow inside our organisation,” he says.

“I’ve watched hundreds of young people develop their careers or grow into leadership positions. One young fellow started with us in the mid-’80s as a scaffolder and is now running a good chunk of work as a senior area manager.

“I can go to Chile, Peru, Saudi Arabia, Iceland, Norway or Canada and see graduates from (Queensland universities) QUT and UQ, Griffith and Bond working on our projects.

“Globally Bechtel’s mining and metals business employs 50,000 people across 11 countries and turns over about $7bn annually in contract revenue and we’re running all this from Brisbane.

“I’m pretty proud of that as both a long-term Bechtel guy and also as an adopted Australian. It is a real privilege to be bringing the world to Queensland and taking Australia to the world.”

If the customer wants you to do another project for them, if communities will welcome you back and people want to come back and work for you – that’s what success looks like.

ANDY GREIG

Australia’s competitiveness: As a nation we have chosen to live in the first world with high incomes and excellent working conditions. So Australia is an expensive place to build projects but we can be really efficient and we do have advantages like resources to develop, rule of law and low sovereign risk. This is a solid foundation for investors to make decisions with predictable outcomes, but whenever I see instability like changing laws, changing regulations and doubt, I think we have to be careful not to detract from that confidence.

Working privately: As a privately held company Bechtel does not focus on growth. Unlike our publicly traded competitors we don’t have to meet quarterly earnings expectations of analysts or the market’s expectations in terms of returns and growth. We have to perform, deliver projects and meet the expectations of our customers. We focus on quality and safety and looking after our people.

Growth is an outcome and will take care of itself if we get all this right.

Industrial relations: On Curtis Island we have an industrial agreement with three unions, the AMWU, CEPU and AWU. We have had some issues and some moments but generally the support from the union leadership has been excellent.

Australia’s construction men and women are skillful, talented and competent. If our leaders provide the right environment on the ground and treat our people the right way, they will perform in a way that’s commensurate with that.

The ‘end of the boom’: I don’t like the term ‘boom’ or ‘bust’ or any other emotive term. I’ve been in the business of large project engineering construction for 32 years and it is a cyclical business of growth and contraction. While the last investment period was more dramatic than those previously, what we are seeing now is a return to normality. Provided the boardrooms of the world’s resource companies believe Australian projects can meet their schedule and budget targets, we will stand ourselves in good stead for continuous future investment.

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DIVERSITY

Queensland women say Count Me In For Australia Pacific LNG Project partner Origin, ensuring the local Darling DownsSurat Basin workforce can seize opportunities that come with the economic and employment growth in the region is key to its social impacts management plan.

But it was through extensive engagement with communities that the integrated energy company saw potential to make an even broader impact on the futures of local women.

“Origin is committed to respecting the interests of the communities in which we operate by engaging with them, listening to them and understanding the impacts of our activities,” says Origin’s social program execution lead Kent Weastell.

“After engaging with women living in Toowoomba, Dalby, Tara, Chinchilla, Miles and Roma, we identified that the barriers women faced were quite unique.

“So it made sense to develop a program to address their specific needs. To help them overcome the barriers to finding suitable employment.”

Women living in the Darling Downs-Surat Basin region are now the beneficiaries of the Count Me In project, delivered by Origin in partnership with women’s community organisation YWCA and workforce solutions provider AMMA Skills Connect.

The aim is to assist local women to overcome barriers to employment and successfully secure work that meets their needs, but Weastell says the project’s mandate extends far beyond the region’s gas industry.

“Now that we are in the peak construction period for the Australia Pacific LNG project, the region has seen an increase in the number of jobs available and the number of people relocating to the region,” he says.

“We found that many local women don’t have the appropriate

level of training for the careers they want to pursue and that they require greater flexibility in work hours and conditions.

“Working with local employers, the Count Me In program aims to match women with employers offering training and more flexible working arrangements.”

Origin has provided YWCA with funding to employ a fulltime project officer to support the delivery of the project, while AMMA Skills Connect exposes employers to the benefits of workforce diversity.

AMMA Skills Connect project manager Kim Hetherington says the Count Me In project is an example of how the positive impact of the $81 billion worth of resource activity currently underway in Queensland can reach far wider than the industry alone.

“The Count Me In project is an extension of AMMA Skills Connect’s project mandate to assist in the upskilling and training of workers directly and indirectly employed in the resource industry,” says Hetherington.

“While some local women aspire to gain the skills to transfer into a resource career, we understand that others wish to follow different employment pathways in their local community.

“Through Count Me In, industry is able to more broadly assist community members to take advantage of the region’s growth and the broad range of employment opportunities that are created in the region.”

The Way Forward Guides: Strategies in gender diversity The organisational benefits of gender diverse workforces and inclusive cultures are widely acknowledged across the Australian and international business communities, but turning theory into practice can be challenging.

Now, Australian resource employers have access to a suite of targeted online guides containing practical information, tools and case studies to assist in the implementation of multifaceted workforce diversity strategies.

Developed by the Australian Women in Resources Alliance (AWRA) with support from the Australian Government, The Way Forward Guides are the first of their kind for the Australian resources, construction and allied industries and cover strategies including:

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• Diversity as a Business Imperative – Leadership • Developing a Diversity Strategy and Program • Building an Employment Brand and Selling an Employee Value Proposition • Successful Attraction and Retention • Building an Engaged and Inclusive Workforce • Work-Life Strategies • Developing Women • Mentoring and e-Mentoring • Becoming a Preferred Employer of Women.

The AWRA Way Forward Guides can be downloaded from www.amma.org.a/awra.

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Michelle and Jazmin Connect through AWRA e-Mentoring Chances are, anyone who’s been involved in career mentoring will tell you how mutually beneficial the experience is. For the mentee, it can build confidence and help to navigate the early stages of a career. Mentors can gain greater career satisfaction, improve leadership skills and enhance professional networks.

At a time when women comprise just 15% of the mining workforce, it is not surprising that mentoring has been identified as a mechanism to achieve greater participation and advancement of women working, or aspiring to work, in resources, construction or allied sector occupations.

An industry-first, the Australian Women in Resources Alliance (AWRA) e-Mentoring Program connects experienced male and female mentors with female mentees across the national resource industry – regardless of location.

Forge Group’s Brisbane-based general manager minerals and resources Michelle Tracey, and final-year chemical engineering undergraduate at Townsville’s James Cook University, Jazmin Kesteven, learnt about the AWRA e-Mentoring Program through a LinkedIn networking group.

The ability to take part in a mentor-mentee relationship through a structured online platform instantly appealed to them both. Tracey saw it as a way she could draw on her experience and support others in the industry, while Kesteven wanted advice on how to prepare as she embarks on a mining career.

“The AWRA e-Mentoring Program allows a broader access to experienced mentors that may not be available if you are limited by location,” says Kesteven.

“It has been really great for me because otherwise there would be no chance to engage with a mentor like Michelle.

“The last few months we’ve been working on graduate applications and preparing for job interviews, so it’s allowed me to gain some advice and guidance before I finish university in six months time.”

Tracey’s 25-year career has seen her work across project management, operation and maintenance on mega resource projects in Australia and internationally. It was the ability to maintain her travel commitments while supporting an aspiring young woman that convinced her to become an AWRA mentor.

“Because I travel a lot, I always felt I couldn’t make a commitment to a mentee when I wasn’t actually going to be physically present,” Tracey says.

“So the fact that the AWRA e-Mentoring Program is based online and supports people that are predominately in remote areas made it easy to manage my travel and make a commitment to others.”

While Tracey is now Brisbane based, much of her career was spent in remote locations where she was often the only woman on site.

As Kesteven’s mentor, she’s found herself reflecting on the early years of her career and drawing upon all of her past experiences.

Mentee: Student, Jazmin Kesteven

Mentor: Forge Group’s Michelle Tracey

“It’s only since I’ve moved back to Brisbane, which has been in the last third of my career, that I’ve had access to networks to provide support and meet people outside of my direct industry,” she says.

“Most of the time, there were very few females in the work environment, and even less senior females. People were looking to me for mentoring but there wasn’t an available program that I could rely on.

“We’ve been working on strategies to improve Jazmin’s confidence in the skills and experience she has and how to successfully communicate that in an interview situation. We’re also talking through some of the challenges in interacting with other professionals and working collaboratively in groups.

“Using the communication techniques that are available it’s really easy to make myself contactable. Being flexible with communication is what you’ve got to do in this industry because you might be sitting in an airport one day and on a mine site the next.”

While AWRA e-Mentoring is allowing Tracey to help Kesteven achieve her ultimate goal of becoming “a confident, knowledgeable and successful chemical engineer in the mining industry”, the formation of a mentor-mentee relationship can mark the beginning of an important career-long connection.

“At the end of the nine-month mentoring program I hope to have achieved the goals I set out and also keep in contact with Michelle as my career progresses,” says Kesteven.

The AWRA e-Mentoring Program is delivered by national resource industry employer group AMMA with funding from the Australian Government’s National Resources Sector Workforce Strategy.

To register your interest in becoming a mentor or mentee, contact AWRA on (07) 3210 0313 or via awra.e-mentoring@ amma.org.au.

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DIVERSITY OZ Minerals’ Leading My Career program matches women with a mentor

Ozzie women meet the challenge As the recipient of the Australian Women in Resources Alliance (AWRA) Award two years running, OZ Minerals is already an industry leader in workplace diversity, but that hasn’t stopped it from continuing to raise the bar.

CONSISTENT and targeted efforts to create an inclusive culture continue to position OZ Minerals as a resource industry leader in workforce gender diversity.

The copper-gold miner has lifted its direct workforce female participation to 24%; a significant achievement compared to an industry average of 15.1%.

OZ Minerals’ key South Australian assets, the Prominent Hill mine and Carrapateena exploration project, account for 460 direct workers or 1,500 including contractors.

Organisational development manager Carly Taylor is often asked to reveal the secrets behind her employer’s success.

“We are constantly thinking outside the box to create opportunities for our people to grow and develop,” says Taylor.

“And we have found that the more women we have in our company, the more women we attract.”

Taylor says the company’s diversity strategy is underpinned by an ambitious target to achieve 25% female representation in every job band across the company. Traditionally, mine operational roles are especially male-dominated.

“Our diversity objectives are incorporated into company-wide www.amma.org.au | Spring ‘13 – Summer ‘14 |

Carly Taylor Organisational Development Manager, OZ Minerals

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Josie Lombardi Metallurgical Superintendent, OZ Minerals

key performance indicators so that diversity is directly measured as part of evaluating overall company performance,” she says.

“We aim for at least one female candidate to be interviewed in 80% of job categories.

“We want a pipeline of women, role-models at every level and most importantly, diversity among our key decision-makers.”

While already punching above its weight in female participation, in 2012 the company identified a barrier that is not uncommon across the national workforce – a lack of women in middle management tiers.

The realisation led OZ Minerals to partner with South Australian oil and gas company Beach Energy to develop Leading My Career - a program designed to assist senior specialist women in both companies to articulate their career goals and advance to leadership positions.

“We ran focus groups to understand the aspirations of our senior specialist women and it was clear they wanted to expand their networks, engage with a mentor and identify the next steps to move into a superintendent or middle management position,” she says.

“Many of these highly talented women were approaching their careers with the view that if they worked hard and did a good job, they would eventually be recognised. This is not always the case.

“Through research we know that women are less forward in applying for roles when they don’t meet all of the selection criteria, whereas men reach for more opportunities to pursue their career development.”

Employed in a mix of traditional and non-traditional roles, participants were matched with a senior executive as a mentor.

They honed leadership skills and formulated actions plans for career development through a series of group workshops.

“The program provided a platform for women to openly discuss their career goals with their managers and mentors.

Several participants achieved promotions or were seconded to senior positions,” says Taylor.

Josie Lombardi was nominated for the program as a senior project metallurgist.

Describing herself as having a passion for ‘all things minerals processing’, Lombardi is a classic example of a woman who had all the dedication, drive and skill to succeed but was more focused on performing her role than thinking strategically about advancement.

“Until that point, I had not once reflected on my career or thought about how it was going to progress,” she says.

Lombardi was partnered with a male director at OZ Minerals; a mentor-mentee relationship she describes as rewarding and fundamental to her career development.

“The program gave me a new perspective on career progression,” she says.

“I used models to profile my strengths and weaknesses, tools to build on my strengths and learnt techniques to increase resilience.

“When the metallurgical superintendent position was made available, I felt inadequate about applying because I only met nine out of the 11 selection criteria and other applicants had been in the industry longer than me.”

Encouraged by her mentor who assured her he had not met all the criteria for the majority of jobs he had applied for, Lombardi went for it and was selected.

The new role saw her lead a team of 13 employees and a contractor analytical laboratory consisting of 28 personnel. Eight months later she was seconded to acting processing manager.

“My mentality has changed as I now see the positive results from my work and my team’s work,” says Lombardi.

“OZ Minerals has installed in me the confidence to go forward and strive to help break down the unconscious bias and perceptions about women working in the resource sector.

“I believe if we take a leading stance in proactively increasing diversity in the workforce, the pool of talent we develop will improve the productivity, sustainability and success of the Australian resource industry.”

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Waking up to unconscious bias The business case for gender diversity in the resource industry is a logical one, but the key to achieving it may lay in unlocking our subconscious.

ACCORDING to Duncan Smith, unconscious biases influence many of the decisions people make, from which breakfast cereal to eat to who to offer a key promotion.

“Unconscious bias is an important piece of the gender diversity puzzle,” says Smith, an associate with professional services firm Diversity Partners.

DUNCAN SMITH “It’s not the only piece of the puzzle, but talking about unconscious bias is a good way to engage people who are struggling with diversity and inclusion.”

Smith explains that to cope with the daily flood of information coming through our senses, our brains categorise the information, form stereotypes and rely on those stereotypes to make decisions.

“It’s not possible to be human and avoid using stereotypes,” he says. “We use these unconscious meanings all the time.

“When a hiring manager believes ‘leader’ equals ‘male’, it doesn’t necessarily mean they’re going to reject a female candidate for a leadership role if she has shown outstanding leadership potential.

“However, the bar the woman has to clear is much higher because the hiring manager must consciously overcome the belief in the stereotype.”

According to Smith, there are three key strategies to overcoming unconscious bias.

“Firstly, don’t just look at the other person as having the problem,” he says.

“The biases always go in both directions.

“Secondly, understand and engage the dominant culture. In a male dominated organisation, unless you can engage the men in the diversity conversation, you’re going to have limited success.

“The third strategy is to understand inclusive leadership and this requires you to be self-aware in order to attract and retain the best people.

“Remember that equity is not equality. If you treat everyone exactly the same way you’ll get different outcomes. If you want equitable outcomes, you need to take a different approach.”

Smith says the challenge for resource industry leaders is to be aware of how the unconscious drives decision making around workforce diversity and illustrates his point by drawing a parallel to safety.

“You wouldn’t just tick the box and say ‘we’re done with safety, we don’t have to think about it anymore’. Safety is a mindset,” he says.

“Being aware of biases and engaging in inclusive leadership is also a mindset that must be consciously applied.”

FMG Aboriginal business deal smashes $1bn target FORTESCUE Metals Group (FMG) has achieved its goal of awarding $1 billion in contracts to Aboriginal businesses, months ahead of schedule.

The ‘Billion Opportunities’ milestone was reached when FMG recently awarded $500 million in contracts to six joint ventures owned by Native Title Groups for the procurement of services across the company’s Pilbara accommodation villages.

The target was set in 2011 for a two-year period, with eligible contractors required to be at least 25% owned by an Aboriginal person or group. The latest deals represent the largest ever package of contracts awarded to Aboriginal business.

“We could have given our traditional owners money but that would have been the easy option,” says FMG chief executive Nev Power.

“Instead, we have given them something more important – an

www.amma.org.au | Spring ‘13 – Summer ‘14 |

opportunity to provide jobs for their own people, build capacity and build assets.”

Of the 102 contracts and subcontracts awarded since the program’s implementation, more than 80% were businesses at least 50% Aboriginal-owned.

Brian Tucker, of the Nyiyaparli people, secured a contract as part of a joint venture with Morris Corporation and says the opportunity was a welcome one for the Pilbara’s Aboriginal people.

“For a long time we struggled and felt that nobody believed in us, but we kept knocking on doors and now Fortescue has given us an opportunity. We want to take it and do the best job we can,” says Tucker.

FMG’s Pilbara workforce is 26% Indigenous, with 460 Indigenous people directly employed and an additional 500 through contracting partners.

DIVERSITY

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Santos GLNG apprentice wins Indigenous Student of the Year Beaming as he shows off his award for the 2013 Manufacturing Indigenous Student of the Year, Jesse Johnston represents a new generation of highachieving Indigenous workers in Australia’s resource industry.

The Santos GLNG manufacturing apprentice was

My apprenticeship has allowed me to combine my interest in the engineering industry with my love of mechanical work and the hands-on experience I gained has really helped me to fast-track my career.

JESSE JOHNSTON

MSQ Indigenous Student of the Year Jesse Johnston with his Santos GLNG mechanical supervisors Peter Stronskyj (left) and William Baker (right)

recognised for his outstanding achievements in vocational education and training at the 2013 Manufacturing Skills Queensland (MSQ) Awards.

On track to become qualified as a diesel mechanic, Johnston says the award was confirmation that his career aspirations were coming true.

“This is a major accomplishment in my life and I’m so honoured to receive this reward – it makes me want to continue to challenge myself and puts me a little closer to achieving my goals of becoming a diesel mechanic,” he says.

“My apprenticeship has allowed me to combine my interest in the engineering industry with my love of mechanical work and the hands-on experience I gained has really helped me to fast-track my career.

“I hope I can inspire other young people to follow their dreams and know that great things can be achieved through hard work, dedication and the right training.”

Roma local Johnston commenced work with the $18.5 billion Santos GLNG Project as a school-based trainee in 2010 through a partnership with Golden West Apprenticeships. He completed his Certificate II in Engineering while finishing Year 12 and then secured a diesel mechanic apprenticeship with Santos GLNG. Santos GLNG aboriginal employment adviser, Che Cockatoo-Collins hopes Johnston’s achievements encouraged other Indigenous students to build their skills through further training and education.

“The school-based traineeship program, which Jesse was involved in, aims to empower local Indigenous students to build new skills as they complete their schooling,” Cockatoo-Collins says.

“Jesse is a testament of what young Indigenous students can achieve and he is already applying the skills he has learnt to mentor other young Indigenous trainees.”

Santos GLNG has been working with Golden West Apprenticeships to provide training and apprenticeship programs in the Maranoa Region for four years.

Located on Curtis Island, Gladstone, the Santos GLNG Project has delivered more than 170 indigenous training and employment opportunities to-date and provides additional school-based traineeships, apprenticeships and cadetships in the areas in which the project operates.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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TRAINING & DEVELOPMENT

Bluestone builds training capability Expansion at Australia’s only operating tin mine is gaining momentum and Bluestone Mines Tasmania’s Steve Rush says qualifications in training and assessment ensure staff are equipped to meet the challenge.

RENISON not only has great economic and historical significance to Tasmania, but as Australia’s largest tin mine the underground project is a major player in global tin production.

First discovered in 1890, the deposit accounts for more than 85% of Australia’s economic tin resources and earlier this year reported a 16% increase in the mine’s total tin metal reserve to 53,100 tonnes.

Born-and-bred Tasmanian Steve Rush has more than 30 years of local mining experience and says the importance of a strong mining workforce in Tasmania cannot be overestimated.

“For 20 odd years I was an underground miner, on the shop floor so to speak,” says Rush, safety and training coordinator for Bluestone Mines Tasmania.

“Modern technology has contributed to a slight downscaling of the workforce (since the 1980s), but here on the west coast, mining is effectively one of the only sustainable industries. The industry is very beneficial to the region and the state.”

The Renison Expansion project is currently under reassessment to ensure Bluestone Tin (a subsidiary of JV project owner Metals X) can tap into the region’s full potential – a massive minerals reserve of 19.25 million tonnes of ore at 0.45%

www.amma.org.au | Spring ‘13 – Summer ‘14 |

tin and 0.21% copper.

With 140 staff working on the surface at any one time, Rush welcomed the decision to put the employees through a nationally recognised training and up-skilling program.

In particular, Bluestone Mines Tasmania engaged AMMA’s Registered Training Organisation (RTO) to put staff through a Certificate IV in Training and Assessment to ensure skills could be appropriately shared among the workforce.

“The structure of our processing mill is very large and there are a lot of different roles. It’s far too difficult for one trainer to cover everything so it became clear that we needed to have more staff qualified to train and assess,” says Rush, who implemented the program.

“We identified four employees that had demonstrated outstanding performance when undergoing training in the Certificate III in Resource Processing and who we knew could assist in ensuring the workforce is kept up to speed.”

The Certificate IV in Training and Assessment comprises 10 units of competency spanning design of training packages and programs, planning and delivery of learning, and assessment.

AMMA Training and Development consultant Craig Gilvarry delivered the course onsite and says it is allows high-performing

TRAINING & DEVELOPMENT staff to extend their skill base while contributing to companywide risk mitigation.

“As the resource industry’s registered training organisation, AMMA receives many requests from employers wanting to ensure a higher proportion of staff can adequately perform verification of competencies,” says Gilvarry.

“Skilled and experienced staff are an organisation’s greatest asset and are inevitably relied upon to act as leaders in the workforce, so it makes sense to get them qualified to train and assess.

“Employers have the added convenience of a dedicated training resource which is able to respond to variable project needs in a timely manner, and in Bluestone Tin’s case, ensure employees meet the latest process and safety standards.

“Needless to say, once employees are qualified, their value to the organisation increases dramatically.”

While on site, Gilvarry also introduced the TAELLN401A – Address adult language, literacy and numeracy skills module, which from July 2014 will move from an elective to a compulsory unit in the course.

“When administering vocational training, it can be easy to overlook the differing language, literacy and numeracy skills of workers,” he says.

“Although this unit is not compulsory until mid-2014, Bluestone Mines Tasmania recognised the importance of trainers and assessors being able to customise training packages to support the different needs of learners and ensure they meet the requirements of the workplace.”

Commercial benefits aside, Rush says one of the most valuable aspects of the training was the response from staff.

The structure of our processing mill is very large and there are a lot of different roles. It’s far too difficult for one trainer to cover everything...

STEVE RUSH

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“It was great to see how much our employees enjoyed the training and emerged with a positive outlook on their abilities and sense of worth to the organisation,” he says.

“If they can see a clear career pathway then they are more likely to stay with the company.

“They work alongside our other employees every day and already have a reasonable sense of skill levels. Now they have the qualification to approach and train others in a timely manner.”

With production at Australia’s landmark tin operation showing no signs of slowing down, Rush says the next step for Bluestone Mines Tasmania is to work with AMMA to become certified as its own registered training organisation (RTO).

“For Bluestone Mines Tasmania, it just makes sense. If we can conduct all the training onsite ourselves, we essentially have a one-stop-shop,” he says.

“We don’t have to bring in external training providers, we can undertake our own in-house training and that’s obviously going to keep our costs optimised.”

Funding available for your workforce plans AMMA’s Training and Development team can greatly assist in your workface development plans and also help you secure federal funding to up-skill your employees.

We are the specialists in securing grants for resource organisations from the National Workforce Development Fund, which has $700 million allocated for eligible employers. But hurry – this is on a ‘first-in best-dressed’ basis.

Why use AMMA Training? We can develop an application with a business case outlining: • The impact of the resource industry on your organisation; • The resulting effects on the competitiveness or viability of

your organisation; • How your project or organisation currently addresses these impacts; • The training that will be funded and how this training will assist in your above plans; and • A clear ‘line of sight’ to a nominated resources development project as defined in a supporting workforce development training plan.

Workforce planning is an urgent issue in the Australian business community but you don’t have to tackle this alone – contact AMMA Training and Development on 1800 891 662.

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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TRAINING & DEVELOPMENT

Emergency management: planning for uncertainty Just as advances in technology have transformed the way natural resources are extracted and processed, the evolution of emergency management has steered the way resource organisations prepare for disaster.

In the 60 years since its inception, the Australian Emergency Management Institute (AEMI) has grown from a school of civil defence to a national centre of excellence for education, training and knowledge development.

“In the early days we taught skillsRAELENE based approaches like how to climb THOMPSON ladders and rescue people from buildings,” says AEMI executive director Raelene Thompson.

“Today we educate managers and leaders on the communication and coordination requirements of their environment, where there are different stakeholders and legislation in place.”

Embedded in the Australian Government’s AttorneyGeneral’s Department, AEMI’s range of information products and services caters to more than 3000 professionals each year – many undertaking the Institute’s flagship Advanced Diploma of Public Safety (Emergency Management).

A diverse range of participants are introduced to the framework of emergency management strategies that includes coordinating resources for multi-agency incidents, managing a recovery centre and designing and managing exercises. Other programs include leadership in crisis, business continuity and organisational resilience.

Thompson says resource organisations need to recognise both the risk factors unique to their particular sector of the industry, but also how this is impacted by geographical location.

“We are all part of a community of some sort and no matter how remote you are, a community is formed by people just living together,” she says.

“In a remote community, your span of influence means that you must think of everything that is needed to ensure your community is resilient to disaster.

“Conversely, in a very populated area, there will be a number of players who may have discreet functions in that environment and you will need to work with all of them.

“Whether it is a scenario related to fire or an event impacting critical infrastructure, organisations need to think about how they will communicate with other agencies, the affected community, senior managers in the organisation and those in the political environment.

“All of these broader issues are expected to be handled well in the modern incident management environment.” www.amma.org.au | Spring ‘13 – Summer ‘14 |

It may not be possible to have a perfectly laid plan for every instance of emergency, but for Thompson it is important for leaders to have the skills to respond to ‘black swan events’; unpredictable or rare occurrences that have the potential to cause major harm and damage.

“We educate about uncertainty, anticipating the unknown and having generic skills to apply to any circumstance,” she says.

“When planning, leaders should take into account all the known threats and be able to utilise their resources to perform an environmental scan and consult with others to ensure information is disseminated to all parts of the community.

“A plan should be flexible, regularly reviewed and tested and incorporated within the broader planning of the sector, community and state.

“The model is not just about having a plan that someone puts on the shelf. It’s really about the process and the ongoing review of that plan to ensure it is alive and agile.”

As well as an education provider, AEMI has a role as a national thought-leader and runs regular workshops on emerging issues that help form future emergency management strategy.

“We regularly connect with various sectors of the community to ensure we build on our education products with the latest thinking and issues emerging in Australia and internationally,” she says.

“In partnership with state and territory emergency management colleagues we have recently conducted workshops in order to enhance the analysis and sharing of lessons from disasters on a national basis.

“The information will be available through the institute’s Emergency Management Knowledge Hub website where we also host discussion forums and information for decision-makers to ensure they are aware of the latest regulations and commentary.

“We aim to make sure the entire resource sector’s capability is developed and improved because that’s really the remit of this institute – to develop Australia’s emergency management capability across all sectors.”

It’s easy to picture the costs that an organisation faces if unprepared to mitigate an emergency, but Thompson says what is often ignored is the opportunity to emerge from a disaster in a positive light.

“Disasters are terrible, but if an organisation can demonstrate its robustness, its ability to help others and show it’s resilience, then from disaster can come real opportunity,” she says.

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TRAINING & DEVELOPMENT

e-Campus masters marine training Kelly Harvie got her sea legs at a young age, and her unwavering passion for the deep blue is the driving force behind e-Campus Australia Maritime College.

THEY say successful businesses are born from a passion and Kelly Harvie’s is the ocean.

However, the founder and CEO of e-Campus Australia Maritime College didn’t expect to have to initially give up her life on the water to be where she is now.

KELLY “We’ve always had vessels in the HARVIE family,” says Harvie.

“I lived in Fort Lauderdale, Florida, for some time and had my own boat detailing and varnishing company.

“I used to deliver vessels up and down the east coast of the United States, around the Bahamas and then I got an opportunity to do an Atlantic crossing. When I came back to Australia I worked on mother ships, prawn trawlers and cargo vessels, I was only supposed to be here for six weeks but ended up meeting my husband.

“He worked on cargo vessels, tugs and mother ships along the east coast of Australia and throughout the Torres Straits, while I worked on luxury white boats. One of us had to give up our career and it wasn’t going to be him.”

Finding herself working on land and feeling like a fish out water, Harvie knew she had to get back to her passion.

“It became obvious to me that I needed to create my own

position, my own company, and it had to be in the marine game,” she says.

Fast forward 20 years and the husband-wife team operate e-Campus Australia, a maritime training institution delivering accredited training from entry level ship safety to engineering and mastering of commercial vessels.

With offices in Cairns, Gladstone and soon Brisbane, the company undertakes competency-based training as a Maritime Safety Queensland accredited registered training organisation (RTO). As a result, e-Campus Australia can provide training under the new national system for domestic commercial vessel safety.

“Since I’ve been doing this we have grown every year, we are continuing to expand and pick up bigger clients,” says Harvie.

“Working with the maritime authorities we intend to expand our scope of registration to include higher-end courses.

“We want to take the college to the point where our students can drive or fix any ship in the world.”

Harvie says a large part of e-Campus Australia’s success can be attributed to the flexibility offered to clients.

“While large colleges have fixed course dates and programs, we prefer to work closely with our clients to achieve a positive, flexible and more conducive training program to assist with skilling employees, ” she says.

“More often than not companies have to pay staff wages while they are away studying, along with course fees, relocation

e-Campus marine training in action

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TRAINING & DEVELOPMENT fees and the cost of replacing that worker.

“It’s our goal to be able to offer a more flexible way of training, to reduce the amount of time in the classroom and to assist companies to get more of their workers qualified.

“Whether they’re an individual or a corporate client, every person is treated depending on their needs and we specialise in developing programs to accommodate people keeping their job.

“Some students may choose to attend classes for some subjects and study remotely for the remainder of the time.”

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By gaining contracts to crew and deliver vessels to different ports and projects around Australia, Harvie says e-Campus Australia is able to offer students ‘real life’ experience and the perfect opportunity for on board training.

“It has always been our goal to include active marine jobs and projects for students to work on,” she says.

“Through delivery contracts, we are able to have trainers and assessors on board as delivery crew, while students which have the required qualifications can be included on board as paid crew.

“This offers a unique training platform and an opportunity for students who are looking for a career change to get paid while gaining commercial experience and knowledge within the industry.

“We have a very proactive team of mariners, trainers and assessors who actively work in the industry and they are not going to sign-off on someone unless they have a full understanding of what the job entails.

“At the end of the day it’s about getting the students skilled and getting them licensed. We offer a personalised service with trainers who actually care. e-Campus Australia may be going from strength-to-strength but Harvie never stops dreaming about a return to the sea.

“My goal is to run my company from the middle of the ocean while navigating ocean passages with my students,” she says.

“I’m passionate about being at sea and I want to continue to take students onboard as I circumnavigate the world.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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INNOVATION

Shifting Gears: Adapting to a 21st century workforce Will FIFO practices be sustainable in a decade’s time? And how will business cope amid the mass retirement of baby boomers? Australia’s most recognisable demographer, Bernard Salt, discusses the trends that will direct our workforce strategies of the future.

IT may all be based on statistics but for Bernard Salt, delving into the lives of the people behind a demographic study is where all the fun lies.

He’s the man to call to find out which town has the highest proportion of eligible bachelors and his use of catchy acronyms such as DINKs (Double Income, No Kids) and NETTELs (Not Enough Time To Enjoy Life) have brought the study of social trends into mainstream media.

But when it comes to business, the KPMG partner’s keen analysis of the evolving lifestyles and values of Australians has earned him a reputation as the social commentator leaders pay attention to.

When focusing on the resource industry, Salt has some important lessons for employers who want to prepare for the workforce of tomorrow. He says the rapid advancement of fly-in, fly-out (FIFO) workforce practices, with about 115,000 workers engaged, is one of the most significant trends to emerge in the last half-decade.

“Australia is going through a transformation. We are leaving behind a 20th century economy and skill sets, and moving towards a 21st century which is far more fluid, far more skilled and far more mobile than ever before,” says Salt.

“FIFO was not a term that was used in the 2006 Australian Census and yet arguably, the FIFO movement was the most important single feature to come out of the 2011 Census.

“The impact of FIFO is felt across the Australian continent.

With a destination like the Pilbara, the labour market is drawn primarily from Perth but also from Adelaide, Brisbane, Melbourne and Sydney – all parts of Australia.

“This is extraordinary mobility and a model for working that was not possible a generation ago.”

Even with a rising permanent population in Australia’s northwest, Salt predicts an increase in military and aviation presence in the region will further impact resource employers’ recruitment and talent sourcing efforts over the next few years.

“There are 60,000 permanent residents in the Pilbara and that has doubled in the last five years,” he says.

“It might double again over the next five years, but even if it does, it will still not provide enough labour, skills, talent or diversity for the mining industry, let alone aviation, infrastructure, military, nation-building and servicing.”

Salt is not alone in this prediction. In June 2013, the Coalition released its 2030 Vision for Developing Northern Australia paper, addressing the need for a “clear, well-defined and timely policy platform” to facilitate a greater movement of people and

www.amma.org.au | Spring ‘13 – Summer ‘14 |

BERNARD SALT partner, kpmg business to Northern Australia.

Supported by lobby group Australians for Northern Development and Economic Vision (ANDEV), headed by Gina Rinehart, the paper proposes such growth could be driven by doubling agricultural output, increasing tourism and building a $150 billion energy export industry.

“Whether this is the solution or not, I don’t know. But I don’t think we should be afraid of having the conversation,” Salt says of the idea.

“At no point in the last 50 years has the level of interstate migration to Western Australia exceeded 10% of total migration to the west. It is easier to attract a worker to Perth or the Pilbara from across the Indian Ocean than from across the Nullarbor Plain.

“And if in the future people start questioning the carbon footprint of FIFO and you decide it is not going to work, where are you left then?

“We need to start thinking big picture.”

Salt says Australia’s population will grow by an additional three million people in the next 10 years.

Moving into their 30s, Generation Y will seek a more stable lifestyle with mortgages and children, leading to a more stable workforce.

However, he says one of the biggest challenges for

INNOVATION

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employers will be the retention and transfer of skills as baby boomers retire.

“Baby boomers are moving from their 50s to early 60s.

They’re exiting the workforce and taking their skills with them,” he says.

“Employers need to consider what programs they have in place to retain the corporate thinking, the corporate knowledge and skill base.

“Baby boomers are not just going to retire. I think we’re going to see a redefinition of what it means to be aged 55-72.

These people may work one or two days per week instead of 60-hour weeks.

“The opportunity is to write business into the narrative of how Australians want to live their life over the next decade. It’s more inspirational, more lifestyle orientated.”

While jobs in sectors such as agriculture and manufacturing are contracting, Salt says the resource industry has generated around 100,000 jobs since the Global Financial Crisis and is one of the key generators of wealth and prosperity.

With skilled workers expected to remain in demand, it will be the most strategic employers that can marry innovative workforce practices with skills retention programs to successfully ride the waves of Australia’s shifting demographic trends.

Wi-Fi first in Bowen Basin In what the company calls a ‘world-first’ for the resource industry, Greyhound Australia has installed Wi-Fi internet services within its fleet of Bowen Basin coaches.

Along with the convenience of having access to the highspeed Telstra Next G service, the technology initiative is part of Greyhound’s move to address the risk of motor vehicle accidents within long-distance commuters in the region’s mining sector.

Greyhound hopes the Wi-Fi will incentivise workers to avoid driving long distances and instead take up company supplied coach travel, with research by the Australian Safety and Compensation Council (ASCC) showing vehicle accidents represent about 41% of all compensated work fatalities.

Similarly, a study by the Adelaide Centre for Sleep Research found that a person who has been awake for 17 hours faces the same risk of a crash as a person who has a blood alcohol content reading of 0.05g/100ml. This puts them at twice the risk of having a road accident than a non-fatigued person with zero blood alcohol content.

“There are inherent dangers involved in commuting to and from work in the Bowen Basin and miners often travel long distances at night and on remote roads,” says Greyhound commercial manager Ben Tune.

“Offering Wi-Fi on a coach is an added incentive for workers to rest and unwind in comfort and safety, and it means fewer cars on the roads.

“It also offers FIFO/DIDO miners a chance to Skype or email their families at the end of the day. This is a world-leading

service for the resources sector.”

General manager resources Mike Goodall says Greyhound was aiming to deliver first-class travel for all of its passengers and benefits for mining companies.

“We’re taking it up to the airlines in terms of passenger experience,” says Goodall.

“We want to offer ways to turn bus travel into productive time by making use of our Wi-Fi technology to conduct employee site inductions or online training on the coach. We expect this will result in cost savings for mine companies.”

Bowen Basin workers can now connect to high-speed Wi-Fi on Greyhound Australia coaches

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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INNOVATION

Keeping on course with community relations Holly Phillips and Ben Bryant represent a growing number of resource professionals who are reaching new career heights through Australia’s only specialised postgraduate programs in community relations for the resource sector.

WHEN thoughtfully executed, corporate social responsibility in the resource industry can enrich communities and positively impact generations of people.

But while the technical aspects of project construction and production have been refined over many decades, Jo-Anne the practice of community relations is an Everingham emerging discipline, requiring the delicate management of community expectations and organisational goals.

Six years ago The University of Queensland’s Centre for Social Responsibility in Mining (CSRM), part of the Sustainable Minerals Institute, recognised the need for resource companies to engage with communities in an intentional and structured way. Consequently, the CSRM developed the industry’s first specific postgraduate certificate, diploma and masters courses in community relations.

Today the courses are both more relevant and more popular than ever before.

Holly Phillips and Ben Bryant are two resource industry professionals who recently completed qualifications through the CSRM’s programs. Both have completed the graduate certificate and are now working towards the graduate diploma.

“I wanted to strengthen my understanding of the social impact assessment process and develop new community engagement skills, but I learnt a lot more about how the industry is evolving as a whole,” says Phillips, community relations coordinator at Kalgoorlie Consolidated Gold Mine’s Super Pit operation.

“The mining industry is moving towards more participatory forms of engagement and people expect a greater say in who will benefit from the proceeds.

“Effective operations are those that can manage their activities in a socially responsible way and can work with local people to understand and achieve the best possible outcomes for both.”

As senior community relations adviser at Newcrest Mining’s Telfer goldmine in the Pilbara, Bryant applies the course teachings to his work delivering community support programs focused on employment, sports, health and infrastructure for the area’s traditional Martu people.

Despite a decade of experience in the community engagement field, he undertook the program to complement his ‘on the ground’ training and to learn from others sharing

similar challenges.

“I consider effective community relations in the resource industry as both the community and the company benefiting from the company’s existence,” says Bryant.

“As a discipline it is extremely broad and two professionals working in the same industry can have completely different jobs, issues and challenges.

“There’s no doubt I have a better understanding of the industry than I did before undertaking this study. I have learned a great deal about social research, company reporting responsibilities and ethics, anthropology and community economic development.”

CSRM senior research fellow Jo-Anne Everingham coordinates the programs which were designed with an industry panel to set a benchmark for professionals like Phillips and Bryant whose careers centre on building relationships with communities.

“We realised that resource companies were prepared to upskill their employees, but there previously weren’t any formal courses available specific to the industry,” says Everingham.

“Recognition of this work is an important part of the whole supply chain and it also provides a career advantage to people who move from project to project.

“Without the skills acquired in this program, you may see a company’s social license to operate break down due to an inability to manage community engagement around, for example, the development of a mine or the construction of a FIFO camp.”

Designed to be undertaken part-time and based primarily online, the programs have attracted resource industry professionals from across Australia and 30 other countries.

KCGM’s Holly Phillips (right) taking part in community activities

www.amma.org.au | Spring ‘13 – Summer ‘14 |

INNOVATION

Newcrest Mining’s Ben Bryant (second from right) on-site with Aboriginal workers

“The course assessment pieces allow students to utilise real community engagement challenges and consider how to manage these with the tools and teachings of the course material along with the personal experiences of others in the industry,” says Everingham.

“We realise that a lot of what people learn comes from their peers, from exchanging experiences and solving problems so the online discussion boards are one of the most important learning facilities.”

Agreeing that the course framework is immediately applicable to their personal experiences and professional challenges,

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Phillips and Bryant both say the course structure is perfectly suited to the nature of their work.

“I have been able to draw on the experience of a faculty that is engaged in best-practice community relations on a daily basis but also form friendships with industry peers who share similar community challenges,” says Phillips.

Bryant agrees: “It helps that the course coordinators understand how demanding a community relations role can be and that we can be in remote locations for extended period.”

While the merits of the postgraduate qualifications are clear, the CSRM also regularly works with companies seeking tailored, short-term training packages for their own specific operational training needs.

While conceding the industry’s market conditions are characterised by cyclical peaks and troughs, Everingham is adamant the demand for resource industry professionals with specific community relations qualifications will only continue to rise.

“The resource industry is not going away any time soon and with escalating tensions at mine sites around the world, the need for effective community relations is only going to get greater,” she says.

“With the right approach, no new project should be phased by resistance from a community which feels it has not been consulted properly or because stakeholder relationships have not been built.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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ECONOMY AND FINANCE

Economist Eslake sees change on the horizon One of Australia’s most highly regarded economic minds has weighed into the discussion on productivity growth, the transition of the resource industry and a possible recession. His message is clear – remove barriers to doing business, let competitive pressure take its course and focus on human capital.

WHEN Saul Eslake talks economics, people listen.

The former chief economist for ANZ Bank and now Bank of America Merrill Lynch Australia has forged a reputation as one of the country’s leading analytical minds.

Understanding the nation’s current SAUL economic paradigm, he says, is to first look ESLAKE at Australia’s positioning through the GFC. Buoyed by the strong capital inflow underlying its $650 billion resource industry, Australia fared exceptionally well through the global economic crisis, avoiding recession and gaining 13% GDP growth since 2007 – while the rest of the first world went backwards.

While many commentators are now predicting a great transition for the Australian economy as the booming resource sector moves from its decade of record capital investment and into its production period – Eslake’s analysis carries serious weight.

“A rise in unemployment in Western Australia, coupled with a decline in the rolling commencement of new engineering construction projects suggests another transition point is on the horizon for Australia’s resource industry,” says Eslake.

“Once Australia’s gas projects shift from construction to production, some economic growth will come from increased mineral exports, since that’s what the investment has all been intended to produce.

“But equally, the 35,000-strong (construction phase) workforce will diminish to 7,500 (production) and that merits a need for the Australian economy to focus on nurturing investment in any way that it can.”

As capital inflow dries up a result of this transition, Eslake predicts a decline in the value of the Australian dollar. He warns however, that the dollar may never return to its former longterm average of US75c.

Many Australian firms are still operating on the assumption that the national currency will remain close to parity with the USD and Eslake believes this is a smart move – given the only sustainable response is to lift productivity and cut costs.

Diagnosing the cause of deteriorating national productivity though, is a multifaceted endeavour.

“For most of the past decade, Australia has been close to full employment and the outcome of that is shortages of skills, bottlenecks in infrastructure and other productivity detractors you wouldn’t typically encounter during periods closer to the last recession, where labour and machinery were abundant,”

www.amma.org.au | Spring ‘13 – Summer ‘14 |

Eslake reasons.

“Since the 90s, there has also been a significant lack of productivity-enhancing reforms, instead replaced by a deluge of productivity-sapping regulation and legislation, the large majority of which have been implemented without any costbenefit consideration at all.

“Even technological innovation has slackened globally, targeting consumption experiences rather than boosting productivity, as the Internet did in the 1990s.”

Overcoming the challenge of productivity growth is, according to Eslake, a balance of managerial decision-making and a ‘productivity agenda’ from the government source. But what constitutes a productivity agenda?

Eslake believes it begins with structural change and investment in education; and a renewed managerial focus on human capital efficiencies.

Eslake says the government’s prerogative should remove any stringent and unfounded regulations not subject to realistic costbenefit analyses.

Australia’s industrial laws fall right into this category – as do measures from government to protect weak Australian industries from competitive pressures.

“What I want to see, and improved industrial relations law is a part of this, is deregulation that reduces compliance costs, eliminates duplication and which promotes competition in the movement of resources from low to high productivity uses,” argues Eslake.

Eslake also criticises a complex taxation system that drives investment into areas of low productivity.

“There is a lot that could be done by way of eliminating distortions in the tax system that encourage the flow of investment into low productivity areas by way of tax breaks,” he says.

“Negative gearing, for example, failed to boost the supply of housing and instead increased the cost of housing, highlighting a significant flaw in the current taxation framework.”

Australia’s resilience through the global financial crisis drew both praise and envy from its worldly counterparts, but without significant reform to boost productivity and allowing competitive pressures to drive natural evolution, Eslake believes Australia is not yet clear of a potential recession.

With 25 years at the top of his game and now one of Australia’s most recognisable economic identities, how the country’s policy makers respond to Eslake’s advice could well determine how Australia’s economic transition will play out – one of prosperity or one of hardship.

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Australia’s global competitiveness continues slide A GLOBAL measure of national economic, investment and business competitiveness has ranked Australia 21st in the world in 2013-14, sliding one place from last year and continuing a worrying downward trend.

The Global Competitiveness Report 2013-14, produced by the World Economic Forum (WEF), is a well-respected measure of a nation’s investment attractiveness and ranks 148 countries across a number of business-related criteria.

Underscoring the argument for workplace reform, the WEF research shows it is again labour inefficiency that is dragging down Australia’s overall global ranking.

“This edition marks the first time that Australia (21st, down one) exits the top 20 and is overtaken by New Zealand (18th), which jumps five places,” the WEF report states.

“Australia delivers a consistent performance across the board, the highlight of which is its seventh rank in the financial market development pillar, the only pillar where it features in the top 10. The country also earns very good marks for higher education and training, placing 15th.

“The main area of concern for Australia is the rigidity of its

labour market (54th, down 12), where the situation has deteriorated further. Australia ranks 137th for the rigidity of the hiring and firing practices and 135th for the rigidity of wage setting.

“The quality of Australia’s public institutions is excellent except when it comes to the burden of government regulation, where the country ranks a poor 128th. Indeed, the business community cites labour regulations and bureaucratic red tape as being, respectively, the first and second most problematic factor for doing business in their country.”

AMMA chief executive Steve Knott says the results ‘should ring real alarm bells for those overseeing our economy and our labour market’.

“This globally recognised report demonstrates why there is no credible argument to support Labor’s six years of forcing unions and bureaucracy between employers and employees an obsession that has failed Australia,” he says.

“The Coalition Government must do better and deliver concrete policies, especially labour market policies, that actually support investment, competitiveness and the ability to successfully do business in this country.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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ECONOMY AND FINANCE

Excessive wages threaten Australia’s offshore oil and gas industry – Deloitte report A Deloitte Access Economics report into the economic pressures in Australia’s offshore oil and gas marine support sector has found its profitability and international competitiveness has been eroded by excessive labour costs and increasing macroeconomic challenges.

The Deloitte report, Analysis of the offshore oil and gas marine support sector, provides critical economic context for the current round of enterprise bargaining agreement (EBA) negotiations that will set wages and conditions for vessels servicing Australia’s offshore resource industry for four years.

“The biggest driver of Australian economic growth in recent years (the resource industry) is set to slow sharply. That will slow revenue in Australia’s offshore oil and gas marine support sector and, with costs rising sharply, will affect the long term sustainability of the sector,” says the Deloitte Access Economics report.

“Over the last decade the (marine support) sector has benefited from a considerable surge in exploration and investment activity. More recently, however, cost pressures in the sector, including labour costs, have increased notably.

“Strong wage growth combined with weakening profit margins over the past few years has left the offshore oil and gas marine support sector in a position where any significant, sustained growth in wages could threaten the ongoing viability of the sector.

“The pace of wage growth in the sector has clearly been disproportionate to wage and price growth in the Australian economy overall. Wage growth which is not reflective of productivity improvements in the sector is detrimental to the

www.amma.org.au | Spring ‘13 – Summer ‘14 |

profitability and sustainability of (the) businesses.

“It is therefore critical for the ongoing viability of the sector that the EBA process facilitates the employer flexibility and wage outcomes required to support the sustainability of vessel operators.”

With the resources boom credited as the major systemic driver of the Australian economy, the expansion of resource extraction across the globe has seen supply begin to catch up with demand.

As a result, Deloitte Access Economics is of the view that the peak of the price phase has already passed, though Australia’s terms of trade is expected to settle at a historically high level.

“The impact of a softer demand outlook, combined with the current cost pressures felt by operators, could significantly erode the business case underlying many of the proposed LNG developments scheduled to commence in Australia in the next few years,” says Deloitte Access Economics.

“Maintaining the international competitiveness of the Australian market is critical to the ongoing viability of domestic industry.”

With assistance from resource industry employer group AMMA, Deloitte Access Economics undertook a survey of vessel owner-operators. The results show the viability of the vessel operators has been tightly squeezed in recent years as the cost of labour rose sharply:

ECONOMY AND FINANCE • On a ‘per vessel’ basis, wages and total expenses have increased by around 40% since 2007-08, while revenue has increased by only 8%; • Between 2008-09 and 2009-10, the sector’s profits fell by 27% while at the same time wage costs grew by around 19%; • Profit per vessel in 2011-12 was half the level recorded in 2007-08; • Since 2007-08, wages and total expenses have doubled while revenue increased just 50%; and • Profit was more than 26% lower in 2011-12 compared to 2007-08.

AMMA chief executive Steve Knott says the competitive challenges facing vessel companies in Australia’s oil and gas sector have changed dramatically since the last EBA negotiations in 2009-10.

“This Deloitte report supports the growing concern within the national debate that cost pressures and productivity issues present very real challenges to operators within Australia’s resource industry, and the economy more widely,” says Knott.

“The group of vessel operators that commissioned this analysis felt it was critical to build a factual basis for discussion about these challenges amid the shifting economic conditions in Australia’s offshore oil and gas marine support sector.

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“Given the significance of this key industry to the national economy, all parties to the current EBA negotiations must work together to keep Australia’s oil and gas industry financially viable and ensure it can provide sustainable employment opportunities.”

As part of the research Deloitte Access Economics also investigated the potential impacts on the rest of the Australian economy should the offshore oil and gas sector fail to regain its international competitiveness and secure more long-term investment projects.

“Any outcome which constrains the operations of the wider oil and gas industry would therefore have implications for Australia’s national prosperity overall,” the report says.

“Not only would the economy forego significant investment and export activity, it would also see the delicate transition between the investment and net exports phase of the mining boom being pressured. The offshore oil and gas marine support sector is at the frontline of this transition.

“Relative cost pressures have pushed Australian projects back in the global development queue; that is a problem not merely for the Australian gas sector, but also for the Australian economy as a whole.

“Other things equal, that underscores the importance of cost control to the outlook for both this sector and for the wider Australian economy.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

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ECONOMY AND FINANCE

Investment Outlook: Competition in a global resource marketplace For more than a decade Australia has been in the midst of unprecedented levels of resource investment, but recent concerns about over-regulation, high taxation, development costs and excessive wages are plaguing the country’s mega resource projects. Here, global economic and investment advisers Adi Karev and Helen Cook discuss with Resource People trends in international investment and competition for capital, North America’s emerging LNG sector, and where Australia fits in to the global resource marketplace.

On Australia as an attractive place for investment: “Australia has abundant technically recoverable gas resources, existing export infrastructure that could be expanded, a historically stable economic and political environment, and proximity to other Asian countries that are driving growth in world energy demand,” says Karev.

“The arguments against investing in the Australian resource sector include a high cost environment, extensive and convoluted regulatory approval processes, and a lack of infrastructure and related service providers in the areas with potential growth in shale, such as South Australia, Western Australia and the Northern Territory.”

On North America overtaking Australia as an LNG powerhouse: “The prospect of North America as the world’s largest LNG supplier remains to be seen. Australia is ahead of the curve with A$200 billion in export LNG facilities under construction. By contrast, exports from North America, particularly the United States, may be limited depending on government approvals, cost, and other factors,” says Karev.

“Nonetheless, North America and other countries will be major exporters creating a supply competition dynamic that hasn’t been seen before in the LNG market.

“Such supply competition will likely have a significant downward effect on global import prices, but at the same time there are increasing numbers of buyers who aim to have a diverse supply portfolio and are attracted to non-price benefits such as project equity stakes, contract flexibility, and supply stability.”

On cost-competitiveness: “High costs, including regulatory compliance, are a real concern for companies looking at new or expanded investment decisions. One of the main challenges for Australia is achieving high productivity, especially compared to other resource countries,” says Karev.

“A number of potential solutions exist to mitigate loss in costcompetitiveness, including changes to regulation and taxation structures, investment incentives for new gas sources such as shale, supporting innovative technologies to drive productivity, and collaborative behaviours where there is little competitive advantage, such as infrastructure.

“Australia is still considered for investment, but in the

www.amma.org.au | Spring ‘13 – Summer ‘14 |

Adi Karev Global Head, Oil & Gas Regional Head, Energy & Resources Asia Pacific China Managing Partner, Oil & Gas Deloitte Touche Tohmatsu

current cost environment, the expansion of existing brownfield investment is likely to be more attractive than new greenfield LNG projects.”

On emerging resource markets: “Asia is a major source of global investment in the oil and gas sector as the region is projected to have the largest share of the world’s energy demand. Currently, mature and emerging resource markets are in a relatively open phase due to the high cost in exploration and development of new resources, such as unconventional oil and gas,” says Karev.

“As production targets are met, technology and technical know-how are transferred, and supply deals locked-in, we expect to see a shift towards more restrictive resource policies that may constrain international investment.”

ECONOMY AND FINANCE On policy requirements: “Australia should accelerate its ability to leverage its advantages to meet the new investment opportunities such as unconventional oil and gas, FLNG, and expansions of existing projects rather than greenfield investments,” says Karev.

On Australia as an attractive place for investment: “The long-term fundamentals of the need for energy and commodities to fuel developing regions around the world continue to apply, despite the impact of the recent drop in commodity prices over the past 12 months. This is part of a normal cycle of commodity supply and demand, together with the impact of uncertainty in global markets,” says Cook.

“However, uncertainty around climate change settings and resource-related taxes such as the MRRT, together with increased costs driven by the high Australian dollar and demand on human and other inputs to massive resource project development has caused some investor concern.

“We anticipate that the dropping Aussie dollar, together with the slowing of commodity demand will temper the cost environment and take some of the heat out of the market, as it has already started to do.

“Many resources companies around the world are struggling to raise capital in constrained markets to further develop their projects. But we are also seeing continued interest from Asia, China, Japan and Korea in Australian projects that are now more financially appealing than 12 months ago.”

On North America overtaking Australia as an LNG powerhouse: “Australia continues to play a key role in the global LNG market which is changing due to the development of North America as a potential major LNG provider by the end of the decade,” says Cook.

“However, Australian projects under execution/past final investment decision in 2013 are expected to come on stream during 2014/15 to 2018, adding significantly to current LNG production in the country.

“The further planned expansion projects in Australia with off-take agreements yet to be signed may be challenged by a possible lower unit price of gas ex US. “US gas via current developing facilities is planned to come to market in 2018. There may also be further significant LNG quantities from other regions such as Mozambique potentially reaching the market by 2018/19 but subject to infrastructure and other issues.

“So the dynamics of the global LNG market are shifting but subject to significant variables. Australia is likely to remain a key provider to markets in Asia due to proximity and a history of reliable supply.”

On cost-competitiveness: “Certainty of investment parameters is important for attracting capital and driving development. Escalating costs have been an issue for Australia given the massive development activity, high Australian dollar and pressures on costs of materials and labour,” says Cook.

“Over the past two years there have been some concerns

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“This can be achieved by creating attractive government policies and regulation around taxation, mobility and access to global labour, expanded infrastructure and helping Australia to become a research/innovation hub for gas in the region.”

Helen Cook Head of Mining, KPMG Australia

from international investors regarding Australia’s taxation measures such as shifting climate change regulation and the introduction of the MRRT on coal and iron ore.

“The industry hopes the post federal election environment will provide certainty on some of these measures.

“Nonetheless, there is still significant foreign interest in Australian resource projects, particularly with alternative investment locations such as Africa and South America carrying associated risks including sovereign risk, remote location operation and infrastructure development costs.”

On policy requirements: “Economic policy and regulatory settings that attract productive foreign investment and protect Australia’s interests are a key part of maintaining Australia’s economic growth given the importance of foreign investment to our economy,” says Cook.

“Leading up to the 2013 federal election, the message the industry sent to both sides of government was that it is critical to ensure the regulatory and fiscal settings support continued foreign investment in the Australian resource sector, given its importance as a key contributor to the economy.

“The industry is looking for the new government to support the economy as we transition from massive project development to a production phase.

“A stable macro-economy, political stability and regulatory frameworks conducive to foreign investment, particularly into resources, will ensure Australia is well-placed. This will be watched closely by the investment market.”

| Spring ‘13 – Summer ‘14 | www.amma.org.au

EVENTS 54

EVENTS

OCTOBER

Monday 14 – Tuesday 15 Set to run alongside Australia’s premier Longwall Mining Conference, the Electrical Engineering in Mining Conference will address specific issues faced in coal mining to design, maintain, manage, improve and implement electrical equipment and safety guidelines. Held at Crowne Plaza, Hunter Valley.

More info at: informa.com.au/conferences/mining-conference Tuesday 29 – Friday 1 Mines and Money Australia features a large number of investors revealing where they will be looking for smart investments in the mining industry in 2014. Held at the Melbourne Convention and Exhibition Centre.

More info at: minesandmoney.com/australia

NOVEMBER Thursday 21 AMMA’s Perth team is looking forward to hosting a special networking event for local members and valued clients at the Origins Pan Pacific. Enjoy drinks and canapes and learn from our special guest speaker Peter Tinley, former Deputy Commander of the SAS Special Forces Task Group.

More info at: amma.org.au Friday 15 The AMMA 2013 Tasmania Conference will cover the post-election IR landscape and delve into employers’ daily operational issues from managing bullying complaints, to drug and alcohol testing and innovations in healthy workplaces.

Whether based in Tasmania or mainland Australia, this conference covers the gamut of workplace issues relevant to all employers. Held at MONA, Hobart.

More info at: amma.org.au Tuesday 26 – Thursday 28 The Australian Institute of Mining and Metallurgy in association with the Centre for Water in the Minerals Industry present the Water in Mining Conference, promoting a practical and operational approach to integrated water resources management and a focus on open dialogue with local communities. Held at Sofitel Hotel, Brisbane.

More info at: ausimm.com.au/waterinmining2013/

DECEMBER Tuesday 3 – Wednesday 4 Mining IQ’s Mining Procurement & Supply East Coast 2013 will address how organisations in the mining industry can reduce costs and improve efficiency through procurement and supply-chain departments. The conference program includes case studies, panel discussions, interactive workshops and networking. Held at QT Hotel, Gold Coast.

More info at: miningprocurement.com.au

www.amma.org.au | Spring ‘13 – Summer ‘14 |

AMMA Industry Briefings These member-only events provide valuable legislative and operational updates for resource employers. Engage with AMMA specialists on important workplace matters, and network with friends and colleagues from across the industry. Contact your local AMMA office to confirm venue.

Melbourne – November 28 Strahan – December 13 Sydney – December 6 Adelaide – December 6 Brisbane – December 4 Townsville – TBA More info at: amma.org.au

Australian Resource People Summit AMMA National Conference, 29-30 May 2014 We’re making AMMA’s most popular annual event even better in 2014 with a sophisticated style change.

The AMMA National Conference has undergone a revitalisation and will make an entrance in 2014 with a new look and feel.

Now known as the Australian Resource People Summit, the event remains the resource industry’s largest annual gathering of workforce focused professionals.

Determined to build on the success of previous years, AMMA quizzed its membership of resource industry employers to deliver a revamped program featuring the latest influencers and issues across industrial relations, human resources, recruitment, training, safety and diversity.

Condensed into two-days, the high-intensity program will be loaded with even more substance, but with less time away from the workplace.

Of course, the crowd favourites will be back with a vengeance – interactive workshops, lively panel debates, best-practice case studies, national identities, networking and the renowned AMMA Industry Awards Ceremony and Gala Dinner.

What else is new? How about the five-star luxury of the Pan Pacific Perth Hotel? AMMA will warmly welcome delegates to this classic venue on the Swan River, providing the perfect conference experience in Australia’s resources capital.

Look out for the Australian Resource People Summit ‘Call for Papers’ and ‘Program at a Glance’ hitting inboxes soon.

More info at: amma.org.au

Senator Eric Abetz speaking at the 2013 AMMA National Conference

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BUSINESS PARTNER DIRECTORY

www.amma.org.au | Spring ‘13 – Summer ‘14 |