National security issues must be resolved in light of expanded Defence activities in test area

10 May 2019

Centre Alliance Senator, Rex Patrick, today called for a comprehensive security review of Chinese owned CU River Mining’s iron ore mine operations in the Woomera Prohibited Area (WPA) and their expansion plans, including a bulk commodity and port facility at Port Augusta.

The call comes after the release of a Defence report on the coexistence of mining and pastoral leases in the WPA and media reports that the company has links back to both the Chinese State and the Chinese Communist Party.

“CU River Mining’s mine operations need to receive greater scrutiny from a security perspective," Senator Patrick said. "The interests of CU River Mining, South Australia and Australia would be best served by a prompt review conducted by Australia’s national security agencies.” 

CU River Mining’s Cairn Hill Mine is located within the WPA which is expected to host an increasing range of highly sensitive aerospace tests and activities.

“CU River Mining's expansion plans need not necessarily raise insurmountable security problems, and investment in South Australia’s mining sector is welcome," Senator Patrick said. 

“However, it must be noted that CU River Mining is a company whose sole shareholder is a Chinese citizen while Jiujiang Mining Australia, a closely associated company, is wholly owned by the Jiujiang Group, a Chinese conglomerate integrated with the Hebai Iron and Steel Group (HBIS), a state-owned enterprise that is China’s largest steel producer.”

“The proposed expansion of Chinese owned and controlled mining and logistics operations in close proximity to highly sensitive Australian Defence testing and training facilities must be subject to the most rigorous examination and assessment by the Australian Security Intelligence Organisation and the Australian Signals Directorate,” Senator Patrick said.

The Defence Department told a Senate Estimates hearing in February that:

The Woomera Prohibited Area is a unique and significant (sovereign) national security asset for the testing and evaluation of advanced Defence capabilities. 

All access zones in the area will be used at an increased tempo from 2019 to support the introduction into service of new air warfare capabilities such as the F-35A Joint Strike Fighter, the EA-18O Growler aircraft and other advanced military systems being introduced under the 2016 Defence White Paper. 

The secure physical and electronic environment of the Woomera Prohibited Area must be maintained to the extent possible for Defence testing purposes, including with our allies and international partners.

The recent review of WPA access arrangements undertaken for the Defence and Industry Departments by Dr Gordon de Brouwer recommended that:

A key consideration for Defence when it assesses WPA access applications should be whether companies have substantial Australian ownership, control and influence.

The findings and recommendations of the review were accepted by the Australian Government in March 2019. 

“A recent proposal by CU River Mining’s to employ an Australian-only workforce at the Cairn Hill mine is welcome but is only part of the overall security picture,” Senator Patrick said.

“A full security assessment must consider not only mine operations at Cairn Hill in the WPA, but also the associated transport and logistic arrangements including port operations at Port Augusta and the likely regular presence of Chinese bulk ore carriers in the Spencer Gulf in close proximity to Defence's Cultana Training Area which is used for combined arms and electronic warfare training,” he said.

“Consequently, following the federal election, I will write to the Minister for Defence and the minister responsible for ASIO to urge a comprehensive security assessment of CU River Mining and Jiujiang Mining Australia's operations.”

In correspondence with the South Australian Premier, Senator Patrick has already raised a number of concerns about potential risks to taxpayers of South Australia should there be questions over the long-term viability of CU River Mining and the proposed port, particularly with any environmental liability associated with the ash dams at the former Port Augusta power station site. 

“Investment in South Australia’s mining sector is always very welcome,” Senator Patrick said.

“However, CU River Mining’s operations and expansion plans, in light of the new Defence report, raises important security issues that should be dealt with proactively. It would be preferable that a comprehensive security assessment of all aspects of the proposed mine expansion before the project and other government regulatory and approval processes proceed further.”

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