Presentation to The AusIMM Board, Friday, 9 th December 2005

1. Advocacy, The AusIMM and the Sustainability of the Australasian Minerals Sector in the 21st Century Presentation to The AusIMM Board, Friday, 9th December 2005 Monika Sarder Policy and Research Coordinator, The AusIMM

2. Overview • Advocacy – why are we doing it? • Challenges to a sustainable sector in our region • Advocacy priorities that this throws up • Target audiences • Current and future projects • Challenges to successful advocacy • Invite comments on how to improve communication with members on these issues

3. Advocacy - Why are we doing it? • At 2005 Congress advocacy was considered a key priority for The AusIMM • Globalisation breeds new challenges to the sustainability of the sector in the Australasian Region • Government attitude has been that “the industry can look after itself” • Definition of professional – someone who follows a Code of Ethics, and who puts responsibility to their community and profession above individual and commercial interests • Sustainability of the sector impacts on both the community and the industry in which we work • The AusIMM is a forum for advocacy that can synthesise expert opinion, and which is not overtly constrained by commercial, sectional interests

4. Minerals Sector in the 21st Century – what has changed? • Global industry that is increasingly consolidated - market value of top five companies is $576 bn, or 44% of market capitalisation • Diminishing returns on exploration investment – new major finds have been few and far between • Sustained high demand from India and China means existing deposits are quickly depleting • Global players will now want to ‘refill the cupboard’ – strategies will determine shape of industry and our place in it. • The want ‘bang for their buck’ in terms of exploration dollars spent. May achieve this through: • R&D to become more predictive and reduce risks in exploration • R&D for minerals processing techniques and mining methods to render previously uneconomic deposits worth their while • Shifting their focus to ‘underexplored’ countries with higher political and social risk regimes

5. Where does this leave the Australia/NZ? • Major profits and record number of new projects underway ($29.4 billion) – product of past exploration activities • Signs that we are falling behind: • Annual reports of major players show decreasing proportion of new project (cf. expansion) capital allocation for this region • Exploration expenditure increased this year, but still below the 25 year average • In the last five years, Australia has slipped from 2nd to 5th place in the global regional rankings for minerals exploration spending. • Our global share of exploration investment at a record low of 12.6% in 2005 (down from 14.7% in 2003-04) • Global players have said they need to ‘increase the search space’. • Whether we can continue to be seen as a competitive destination for greenfields exploration investment depends on whether we can continue to maximise our current advantages whilst offering an expanded search space .

6. Key Areas for Advocacy • Maximise current advantages • R&D: Maintain position as R&D leader by supporting govt/uni/industry collaboration (CRC’s, AMIRA, etc) and encouraging policies supportive of in-house R&D by local SME’s. • Education: Support policies for sustainable minerals tertiary undergraduate places and adequately funded PhD programs • Attraction: Ensure sufficient number of talented and committed graduates are available for uptake to the industry. • Retention: Promote stable professional workforce by supporting measures supportive of diversity, addressing Gen Y challenge, planning for ageing workforce and assisting in career pathways. • Social license to operate: Balance need for low sovereign risk with social license to operate (best practice for materials stewardship, native title, OH&S, rational approach to uranium debate, industry self regulatory codes like JORC).

7. Key areas for Advocacy (cont’d) • To increase search space • Encourage State Government strategies aimed at increasing exploration/geological knowledge (eg PACE program) • Minerals related R&D: more predictive methods, more effective mineral processing and more efficient mining methods • Improve Access to Finance for Juniors (make most of the new discoveries) • Deal structures between majors and juniors must be more attractive

8. Whom should we be convincing?

9. Advocacy – Major Achievements to date • Increased presence in media • The Australian: exploration issues covered • The AFR: skills shortage, diversity issues • The Age: need for rational uranium policy • The ABC: skills shortage and sustainability • Major presence in AFR Exploration Feature: need for strategic R&D, skills shortage, need for more exploration. • Herald Sun: need for more exploration • Our opinion is being actively sought – building relationships with journalists • Major submissions 2005 • Commonwealth Grants submission in favour of raising funding for minerals related courses to the same level as Agriculture • Research Quality Framework Submission on appropriate assessment for minerals R&D • SET Skills Audit • Higher Education Principles Submission • Submission to add The AusIMM members to list of people who can witness Stat Decs • Major Projects 2005 • Uranium discussion paper (fed into Federal Working Group on Uranium Communication) • Research into Returning to Work After Maternity (widely distributed amongst women, profiled in HR magazines and Fin Review) • Materials Stewardship discussion paper

10. Current and Future Projects • Develop discussion paper on policy settings for minerals R&D for a sustainable sector • Issue clear statement of support for CSIRO Minerals Down Under to government and media • Increase our presence as ‘rational voice’ in the uranium debate • Pressure DEST to increase funding for minerals related courses, in light of Minister Nelson’s statement that “areas of national priority will be protected.” • Conduct survey of members on retention to gauge extent of professionals skills shortage and impact on industry - Develop retention initiatives based on results • Make submission to ALP Policy Committee – 2007 Platform • Reinforce key AusIMM submissions and elements of MEAA prior to Federal Budget (Cth Grants, Flow Through Shares, Minerals Down Under) • Increase professionals’ consultative role in development of new OH&S policies in the mining industry (member on review panels?) • Investigate policy settings for SME’s to engage in R&D – are these appropriate? • Highlight best practice by States (such as PACE program) in media. • Develop strategy for timely response to events in media - make the most of opportunities (upcoming water conference to highlight water issues)

11. Challenges to Overcome • Lobbying State and Federal Governments • attitude that, the industry is in the midst of a boom and that it is not time to ask for subsidies (tertiary funding, R&D etc is seen as subsidy cf. addressing a capacity constraint) eg “the middle of a global resources boom is not the time to argue for mining subsidies..” (Minister Macfarlane to MCA) • Making Media Presence Count • Company announcements speak louder than long term strategic warnings – company quarterly report announcements outnumber our press releases • Addressing Social License Issues with Care • Issues such as uranium, materials stewardship, industry self regulation etc need to be approached from altruistic ‘ethical’ point of view – otherwise dismissed as self interested stakeholder and can lose credibility • Engaging the Membership • Expert opinions of breadth of membership is not sufficiently tapped in to, although input from committees and a concentrated number of members has been excellent and invaluable in developing credible lobbying positions

12. In Conclusion • Current boom is a double edged sword – minerals industry is perceived as exciting, reinvigorating media and government interest in these topics, however mining industry is seen as a ‘force unto itself’ that can be sustained indefinitely. • For me – steep learning curve in developing positions and strategies – adapting to new mediums as a way of presenting information • Have been fortunate enough to have access to a number of excellent mentors. • None of the our advocacy achievements this year would have been possible without the expert input of a number of committed members: • Highlighting strategic policy considerations • Reviewing policy documents to ensure evidence drawn from secondary sources accorded with professional experience • Providing evidence and developing arguments for policy positions • Engaging in thought provoking discussion in Committee meetings • Providing well considered feedback to documents • Bringing to light new issues

13. Conclusion (cont’d) • Due to reliance on members for policy development, communication with members one of the largest parts of my role. • Communicate through: • Congress, Societies and Task Forces • Email from members – group and one-on-one • WIR, Newsletters, Bulletin, web site • Conference presentations • Welcome suggestions on how to improve this • Engaging in advocacy has been a truly collaborative process and am looking forward to refining this in 2006!