Western Australia has benefited immensely from its proximity to Asia and the state's former mining minister Bill Johnston believes it has more to offer the region beyond raw materials.

As he prepares to exit the political stage next March, Johnston is taking the opportunity to explain to the Future of Mining Asia 2024 what he learnt during his time as the state's mines minister and what the state can offer the region.

It should be noted that he was also WA's minister for Asian engagement for much of his government tenure.

His main area of address at FoM Asia will be on critical minerals and the opportunities for the region of working with WA.

In an interview with Aspermont's Chris Cann, Johnston said the state already had a number of relationships in place with Asian countries over its critical minerals.

"There will be increased opportunity for partnership out of WA," he said.

"We've got the Lynas [rare earths] refinery in Kalgoorlie, engineering complete and ready for ramp-up.

"We've got Iluka's Eneabba rare earths plant well into its construction phase.

"These are real opportunities for partnership in Asia."

Johnston will also be taking part in government dialogue sessions at the conference. 

He wants to listen and learn, but also explain what WA can teach when it comes to regulation, social licence, renewable power, and royalties.

WA has a long history of trade with Asia. The first export by Europeans from the state was sandalwood from its South West to India, which is how the town of Australind gained its name. Even further back, Aboriginals in WA's north traded with Indonesia.

These days WA is a state powered by mining. There are about 135,000 Western Australians working directly in the sector, roughly 15% of the state's workforce. However,  add to that those involved in supplying mining and about one quarter of the state's population is involved in the industry. That is probably the most intense involvement anywhere in the world.

As Johnston points out: "There are not many places in the world where people discuss the price of iron ore over a cup of coffee".

He said that this not only meant a strong understanding of the sector's importance but also a strong ecosystem in place to support it.

It also means the state, and indeed much of Australia, has a level of mining acumen that is the envy of the rest of the world.

"If there is a difficult-to-develop project anywhere in the world, you can guarantee there is an Australian there trying to make it work," Johnston said.

Finding better

Given the state's mining powerhouse reputation, it is surprising to learn only 20% of its landmass has been explored for minerals.

That is because what remains is much harder to find.

Johnston believes emerging technologies will help unlock the potential of that remaining 80%.

"We do see a lot of exploration upside in WA," he said.

"New technologies and new approaches are showing we can find mineralisation where we didn't expect before. That's why the government is investing in Exploration Incentive Scheme."

However, it is more than just putting up the money to help explorers drill prospects.

Johnston said half the EIS went to precompetitive geophysics to help explorers determine where to drill in the first place and the other half went towards innovative and new areas for exploration.

"The technology is an essential element of the next discoveries," he said.

"I just use Havieron as an example. The orebody is 400m under cover so you can see a traditional rock chipping metholodgy is not going to work on those kinds of projects.

"We've had a completely new understanding of the large-scale systems geology in WA, and that's helped us find deposits closer to Perth, such as the Gonneville polymetallic discovery.

"So technology helps in driving new discoveries, and if all the easy-to-discover outcrops have been developed, then this is a new opportunity to find the mineral wealth that sits under cover right across WA."

Permit me

Johnston said WA had a massive advantage in having an established regulatory framework in place.

"Look at the Pilbara Minerals Pilgangoora project," he said.

"Four years from discovery to production. There's not many places in the world that could do that.

"Certainly our good friends in Canada and the US can't believe how quickly we can move in WA.

"Where it can take decades just to get a tenement issued, we can move quickly because everybody in government and everybody in the community understands the needs of mining. 

"That isn't to say that we skip steps.

"You have to get your consents from Traditional Owners, you have to get your environmental approvals done.

"But the good news is that our bureaucracy, our community, understands the needs of mining and makes sure we can move quickly to give a yes or no on a project."

Outreach efforts

WA is also prepared to spread the word about how it manages project permitting in what are often surprisingly fragile ecosystems, given the ruggedness of the terrain they sit in.

"The government of WA, through our mining agency, engages with other governments, particularly in Africa, in skills transfer and capacity building," Johnston said.

"We do think a lot of the policy settings we have in WA are transferrable to other jurisdictions.

"We think it would benefit those domestic jurisdictions, as well as investors, if they were to apply those learnings.

"Indeed, when we engage with countries in Asia, that are looking at mining, we make the point to them that if they give a stable long-term investment environment, they'll get stable, long-term investment. If they continually only provide short-term approvals and change the regulatory framework, they'll get investors that take a short-term approach."

Obviously, particularly when looking at Asia, WA's comparatively low population density does make the mine permitting process somewhat easier.

Nevertheless,  Johnston believes there are still things WA can teach.

Things such as getting a proponent to prepare a mine closure plan alongside their plan for the mine itself.

Another is to get the proponent to explain to the government and the community what the final landform will look like when the mine closure procedures have been completed.

"Sometimes there will be a mine void left at the end of the project," Johnston said.

"But if the community understands what it is going to look like it will be more ready to approve it."

Social licence

While good regulation helped build WA's mining industry, having a mining industry prepared to develop and adopt best practice helped too.

So can this social licence be exported?

"Every community is going to have their own particular issues to deal with, so it's not that you can just transfer everything from Australia to another jurisdiction," Johnston said.

"But we do think there are a few key elements."

Johnston admitted the mining industry had not always had the best relationship with the Traditional Owners of the land it was mining but said those relationships were improving.

"So we think that's an opportunity we've learnt from others and we think others can learn from us," he said.

"Benefit sharing with local communities, I think that's something that needs to always be considered."

Another is the royalties factor. WA has an ad valorem royalty regime, essentially a tax on the value of the minerals being extracted. The federal government taxes the profits the mining companies get from extracting those minerals.

Johnston's view is that regardless of the approach taken, being clear about what it is up-front ensures all parties understand how things will work.

"There's a whole range of opportunities we think for an exchange of views with our friends in Asia and we're keen to continue to do that," he said.

Asian engagement

Asia has been a particular interest of Johnston's throughout his political career. He was, for several years, WA's minister for Asian engagement.

He said there were six countries that were considered to be of great strategic importance to the state. Japan, South Korea and China are the existing partners and India, Indonesia and Vietnam are the emerging ones.

About 30% of the state's trade is with China.

"We think there is a lot of opportunity in the services sector," Johnston said.

"We'd happily see raw material sales. We'd happily see Australian companies investing in these jurisdictions. But we also see the opportunity for Australian services, including mining services to be made available to these jurisdictions.

"India, for example, has a very inefficient mining industry. We think we'd be an ideal partner for training the workforce in India, training the leadership of the mining sector in India, exchanging leaders and regulators so everybody has a better understanding of the more mature jurisdiction and what we've learnt over time.

"We think some of our mining service companies would be able to provide additional benefits to the Indian mining industry.

"We think there is a good opportunity for partnership in Asia."

China growth

The lion's share of WA's Asian engagement in terms of trade is with China. 

Obviously a lot of that is in the form of the billions of tonnes of iron ore that have been sent there from WA's northwest. Indeed, Rio Tinto recently waved off its four billionth tonne of iron ore to China.

However, China has also become a major investor in WA. Its investment in the Rio Tinto-operated Channar joint venture in WA's Pilbara was China's first-ever mining project investment. 

"Projects like the Sino Iron project, a multi-billion dollar, and as I understand it the single largest Chinese investment in a Western country, where 3000 Western Australians work," Johnston said.

"They have highly-skilled, high-paid jobs. That's exactly what we're looking for.

"The Tianqi joint venture with IGO has delivered a lithium hydroxide plant, one of the first lithium hydroxide plants outside China. That's a clear opportunity for WA."

Remote power

Johnston said when it came to the sustainability of the mining industry, on-site renewable power generation was something the industry was fast learning about. 

WA has a particular challenge when it comes to power.

"More than half the electricity generated in WA is not distributed through a grid," Johnston, who was also the state's energy minister for several years, said.

"It's generally on-site power at mining and mining-related projects.

"We can see the rolling out of new technologies in those mine sites.

"What WA business brings to the table there is they're experienced at integrating all these different technologies to make them work in an independent way on a particular mine site."

Johnston also pointed to the capabilities of the government's remote power agency Horizon Power, which provides power to 138 Indigenous communities across the state and is rolling out renewable energy projects to each one of them.

He said that was not dissimilar to the issue Indonesia faced with its eastern islands.

"The technology being applied out our Aboriginal communities could also be applied to reduce diesel use at individual communities in eastern Indonesia," Johnston said.

"We don't make solar panels. We don't make the batteries. But we do have the ability to integrate it all into a solution for remote power."

Hard lessons

Johnston said dealing with First Nations peoples was not something the government had always gotten right.

"If you go back 20 or 30 years ago there was strong conflict," he said.

"But we think we're starting to move past that because both sides have learnt to live with the other side.

"Our federal government legislation in terms of Native Title is very strong. You can't issue a mining tenement in WA without the consent of the First Nations Traditional Owners of the site or the approval of a court process.

"So the mining industry of WA has come to terms with that.

"That usually includes benefit sharing with the Traditional Owners and that's a way of providing strong opportunities for development for local communities.

"We think that's something we've had to learn over time.

"And again, there're always improvements in environmental performance and expectations of environmental outcomes have changed over time.

"We now, particularly in iron ore and other large-scale mining, look to in-pit waste disposal so that reduces the impact on landforms."

Nickel back

With BHP shuttering its WA Nickel arm, the latest blow to the state's nickel industry, Johnston said he believed there was an argument for a sustainability dividend in the nickel price.

That means those operations producing nickel more sustainably would get a higher price.

The challenge the WA nickel industry has faced has come from its Asian neighbour Indonesia, which has been very efficient in developing its own nickel industry with the benefit of Chinese investment.

That development has been so successful that it led to a glut in nickel supply, which cut the nickel price to a point where many Australian nickel miners could not compete.

"I'm not here to reflect on Indonesia's decisions in how they develop their nickel industry but what I would say is in the new carbon-constrained world we all have an obligation to reduce carbon emissions and we certainly think in the nickel space those companies that are lower carbon and lower environmentally-impacting processes should be rewarded for their work," Johnston said.

"If there was perhaps some price reflectivity that might be something that would be helpful to the Australian industry and then it would be up to others to decide what they wanted to do with their own industry.

"I think customers will need to do that [pay more for more sustainably-produced goods]. I think there is an expectation of better outcomes for embedded carbon in products. I think that would be good for everybody.

"People would argue you're talking your book for the WA nickel industry and that is probably true. But at the same time it's an opportunity for other nickel producers to see how they can also apply technology to reduce their carbon emissions.

"I admire how quickly Indonesia has developed its large nickel industry. They've clearly had a good partnership with Chinese investment to make that great achievement.

"I see it as another opportunity for Indonesian industry to take the benefits available through lower carbon technologies."