Olympic dam expansion no more. Whats going to happen to property prices?

http://www.businessspectator.com.au/bs.nsf/Article/BHP-wont-proceed-with-Olympic-Dam-expansion-pd20120822-XE94U?opendocument&src=idp

I think it is a real blow for SA. The expansion was an enormous amount of activity for SA. Personally I am not changing my investment plans, I just think we'll miss out on a Perth / WA like boom, at least for the time being.

If someone was speculating on land in SA to go through the roof due to Olympic dam they might have to wait a while longer yet.

http://www.propertyobserver.com.au/south-australia/bhp-s-scrapping-the-olympic-dam-mine-expansion-won-t-affect-sa-property-investors-much-terry-ryder/2012082256193?utm_source=Property+Observer+List&utm_campaign=97e63e3f7e-August_23_20124_10_2012&utm_medium=email

Interesting, but unfortunate for the area.

Cheers

D

This is what Due Diligence is all about.

If you do your own research and you make sure the property suits your investing needs, then that's the end of it.

Good luck with it all Zahn

Cheers

D

I work in Engineering in WA.

BHP have an external hiring freeze. A few months ago there was all talk of boom time, I can tell you I don't see it here.

If anything companies are now bringing in cheap 457s to increase profit margins, its diabolical really.

The company I'm sub contracted to, and its a big multinational vendor, has NO big projects in the foreseeable future, they also lost the Olympic Dam work this week.

What boom?

BHP are a Blue Chip company that need to look after their share holders. Their decision is one more for the current conditions. I believe they will still proceed with the project when the time and conditions are right again. Be that a new government or world commodity prices.

Whyalla is still a good place to get an early foot hold in.

Mines are already there moxi

A bit of SA state govt feel good PR. Wouldn't get too carried away with it. You'll be bouncing great grand kids on you knee by the time mining booms again.

Moxi it's not pessimism it's called realism. I'm in logistics directly related to resources. I make business decisions based on reality not hope.

Woomera is 18% of SA in land area. It already has several miners active in that area. The geology is reasonably well understood as well as its potential. Only about 80% of Woomera will be available, the remaining 20%+ will stay exclusive for testing purposes. 

• We have more supply of the major ores (iron, aluminum, lead, copper etc) than the world can absorb presently. It may take another 2 decades to grow into the current supply capacity.
• Uranium has a big question mark over it as China reevaluates its own nuclear energy program, Germany and Japan decommissions out of nuclear and alternative nuclear reactor fuels become viable.
• Gold is usually mined in conjunction with other minerals like copper. As it increases in value it will make currently uneconomic deposits viable however it's a very small player in the resource space.
• Compounds required for tech and high tech applications will probably see growth (graphite, silver, rare earths) over the coming years but still only represent a fraction of the resource industry.
• Oil and gas will take the lead in resources – shale gas/oil may have some legs in the future but it's still early days in Australia
• thermal energy looked promising early on but is apparently dying a slow death as the economics of it play out.

If your going to take a punt on RE on a resource demand basis then you have to look at the major resources, coal and iron ore. It's only the big resources that push local areas hard and drive demand in local towns. Olympic Dam will probably muddle along for decades unless they can find;

1. a significant market for uranium, and
2.  a way to separate copper and uranium economically.

SA is probably the least attractive state to invest in my opinion and Woomera holds no more opportunity than a thousand other places around Australia. Qld got its lift from coal and gas. WA got its lift from iron ore and gas. SA by comparison has no major resource but instead a fragmented resource profile of many small mine operations. Now that OD has been put on the back burner there is no real driver that will lift SA like the other states. Until there's a business case for investing in SA I'd personally look elsewhere.