13 December 2013
North Queensland Register
THE Ord Irrigation Scheme is set to double in size with the State Government signing a new development agreement with Kimberley Agricultural Investments (KAI) last week.
Under the agreement, KAI is required to construct on-farm infrastructure and develop and crop farmland to secure a 50-year lease over 7400 hectares of Goomig land.
As part of the agreement there is also a three-year option to further develop 6000ha once Federal environmental approvals and an Aboriginal Development Package are finalised.
The agreement was signed by Premier Colin Barnett and outgoing Regional Development and Lands Minister Brendon Grylls and initiates a staged investment process worth an initial $200 million.
KAI also committed to achieving significant project milestones over the next four years.
The State Government has already spent $322.5m through Royalties for Regions to support the Ord expansion.
Mr Barnett said KAI’s investment would create new agricultural land in the Goomig and Knox Plain areas of the Ord Valley.
He said the State’s own extensive investment and now the investment by KAI, will foster sustainable economic growth in the East Kimberley.
KAI will construct infrastructure – such as additional irrigation channels – and develop and crop new farmland which will eventually double the size of the Ord Irrigation Scheme.
“The State this year has successfully completed 41km of new road, a 40km extension of the main irrigation channel and 86km of supporting channels and flood protection levees,” Mr Barnett said.
“This has provided an injection of about $92m into the local economy across 82 businesses, including indigenous ones.”
KAI is an Australian company but it is wholly-owned by Shanghai Zhongfu (Group) Co, whose parent company is major Chinese construction group Shanghai Zhongfu Real Estate Co.
KAI was named as the State’s “Preferred Proponent” in November 2012 and the two parties signed an Early Access Agreement earlier this year.
KAI has already cleared 2000ha which is now ready for levelling.
“Over the long term, KAI plans to create a substantial sugar export industry, diversifying the Kimberley economy through the creation of about 300 jobs in both agriculture and manufacturing,” Mr Grylls said.
“The Ord project is an excellent example of the progress that can be achieved when government, the private sector and traditional owners work together.
“This is the biggest agricultural development in the Kimberley in more than 40 years.”
Australia China Business Council (ACBC) in WA president Adam Handley said the council was delighted to welcome KAI and Shanghai ZhongFu (Group) Co’s expanded involvement in the WA economy.
He said that investment in agricultural food production was already an important and growing part of WA’s relationship with China and the doubling of the Ord Irrigation Scheme represented a huge opportunity for WA and China.
He said WA accounted for more than 70 per cent of Australia’s total merchandise exports to China in 2011 and 80pc of China’s investment into Australia over the last five years.
Courtesy of the North Queensland Register