WELL before BHP Billiton pays any additional royalties for its greatly expanded Olympic Dam mine, the state government will have spent most of the money.
A sprawling new Royal Adelaide Hospital on the west end of Adelaide's fashionable North Terrace will cost almost $400 million a year under a complex public-private partnership, more than the projected increase in royalties from the copper-uranium mine destined to become the world's largest open-cut pit.
The extra revenue from the fully operational mine is estimated at $350m, provided commodity prices hold up, but this money won't come on stream for another decade. Meanwhile, from 2016 the state government will start paying developers an average of $397m a year for 30 years, reaching a gross value of $11.7 billion, or 33 years' revenue from the expanded mine.
While South Australia is only a resource-rich wannabe, it's starting to follow the example of Western Australia and Queensland, which have gone deeper into debt even as mining revenue has surged.
Paul Cleary
The Australian
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