Insights

In this Insight, we explore recent developments in the resources and infrastructure sectors including the risks of investing in Africa, the impact of industrial disputes and the controversy around shale gas projects. Geoff Brunsdon, Executive Chairman of ICS Advisory, also considers the pending takeover of ASX-listed Ludowici and what this means for Australia’s mining services sector.

In this Insight, we consider four leading challenges facing Australia’s resources industry in light of global market uncertainties and easing commodities pricing. We note industry concerns over local content benchmarks on major resources projects. We discuss commercial shale gas exploration in Australia and overseas, the PPSA now being in force and the impacts upon junior explorers from Queensland’s new auction system for exploration tenement auctions. We explore evidence pointing to the Kyoto Protocol’s lack of effect on worldwide emissions. Lastly, there are regular updates on the top five movers, commodity prices and the latest in M&A, capital raisings and IPOs.

Risk and uncertainty are this Insight’s lead themes. We discuss the implications around transferring risk from equity-funded mining companies to debt-funded contractors.We explore the need for mining companies to review their funding arrangements in light of European financial markets stress and Basel III. We consider Australia's bright LNG future and the need for resources companies to understand the provisions of the Personal Property Securities Act. Lastly, there are regular updates on the top five movers, commodity prices and the latest in M&A, capital raisings and IPOs.

This Insight discusses the likely impact of the proposed Minerals Resource Rent Tax (MRRT) and the importance of accurately valuing the starting base allowance. It also focuses on the importance of building strong relationships with Traditional Owners, the coal seam gas debate and provides an overview of the financial results and outlook for five major resources companies. Lastly, we provide our regular updates on the top five movers, commodity prices and the latest M&As, capital raisings and IPOs.

This Insight discusses the real impact of construction cost blowouts on a project’s Net Present Value. It also focuses on key employment issues for the industry, including union activities, continuity of tenure and Fortescue Metals Group’s unique strategy for retaining staff. Finally, we provide an update on ASX movements, commodity prices and the M&A, capital raising and IPO activity for July 2011.

While the Australian mining industry is enjoying one of its biggest booms in recent decades, growth will be constrained by increasing costs, and numerous projects are likely to be delayed or are at risk of not being delivered at all. The down-stream impact on suppliers to the resources sector will be significant.

As Australia's most globalised industry, the minerals sector has experienced significant growth in recent years, driven by buoyant commodity prices and competitive advantage. Underpinned by quality reserves, technical expertise and world-class businesses, it has led Australia’s recovery from the global financial crisis. But changing patterns of global investment, and continued pressures on local business settings, access to labour and materials, and market dynamics mean that the sector is likely to remain volatile.