ANNUAL REPORT 2021/22
ACKNOWLEDGEMENT OF COUNTRY Mid West Ports Authority acknowledges and respects the Wilunyu, Nhanagardi and Naaguja peoples of this land and waters we stand on. Elders past and present, the youth and Yama(t)ji people of the Mid West region who hold the stories and hopes for the future leaders. MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 2
CONTENTS 1.0 OVERVIEW 1.1 Port Overview 1.2 2020/21 Highlights 1.3 Key Business Results 1.4 Combined Chair & CEO Report 2.0 OPERATIONAL STRUCTURE 2.1 Board of Directors 2.2 Executive Leadership Team 2.3 Organisational Chart 3.0 PERFORMANCE 3.1 Performance Against Targets 3.2 Major Achievements 3.3 Key Projects 3.4 Operations 3.5 People 3.6 Planet 3.7 Prosperity 3.8 Trade Map GOVERNANCE ANNUAL FINANCIAL STATEMENTS 5.1 Directors’ Report 5.2 Statement of Profit or Loss 5.3 Statement of Financial Position 5.4 Statement of Changes in Equity 5.5 Statement of Cashflows 5.6 Notes to the Financial Statement 5.7 Directors Declaration 06 08 14 16 18 22 24 25 27 28 30 34 36 42 44 56 58 59 68 70 76 77 78 79 80 105 5.0 4.0 62 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 3
Vision TO BE BOLD SUPPLY CHAIN ENABLERS FOR THE SUSTAINABLE LONG-TERM FUTURE OF REGIONAL AUSTRALIA. Purpose To provide a sustainable gateway for trade and tourism. Values Accountability Caring Courage Collaboration Integrity MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 4
Statement Of Compliance For the year ended 30 June 2022 To the HON Rita Saffioti BBus MLA Minister for Transport; Planning; Ports In accordance with section 63 of the Financial Management Act 2006, I hereby submit for your information and presentation to Parliament, the Annual Report of Mid West Ports Authority for the reporting period ended 30 June 2022. The Annual Report has been prepared in accordance with the provisions of the Financial Management Act 2006, Port Authorities Act 1999 (WA) and other relevant legislation. Noel Hart Chair Mid West Ports Authority The aim of this report is to inform Mid West Ports Authority (MWPA) customers, community and other stakeholders about the organisation, its strategy, performance and governance for the 2021/22 financial year. An online version of this report is available at: www.midwestports.com.au For any inquiries please contact us at: [email protected] ABOUT THIS REPORT MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 5
1.0 OVERVIEW MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 6
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PORT OVERVIEW Mid West Ports Authority (MWPA) provides an essential service for regional Australia and Australia’s economy in the provision of facilities that connect the regions to national and international markets. With a vision to be bold supply chain enablers for the sustainable long-term future, MWPA is ideally situated 430km north of Perth providing direct access to Western Australia’s hinterland and Mid West Gascoyne. As one of Australia’s most diverse ports, MWPA is recognised as a specialist port catering to boutique operations, collaborating closely with the customer to achieve mutual success. MWPA appreciates the value in its diverse operations and the opportunity this extends to the regions, playing an essential role in planning, facilitating trade and striving to future-proof growth of the Mid West region for current and future generations. As a Government Trading Enterprise (GTE) MWPA operates under the Western Australian Port Authorities Act 1999 and associated regulations. As the gateway to trade and tourism for the Mid West and as the key economic stabiliser and growth driver, MWPA facilitates the export of grain, minerals and livestock, and imports fuel, minerals, fertiliser, and bulk cargo while welcoming cruise ships and specialty vessels. Port Assets Used To Facilitate Trade MWPA operates with seven (7) commercial berths and associated marine assets including the harbour basin and channel. These assets are critical to the delivery of port services. Berths 1/2 through to 6 are owned, operated and maintained by MWPA. Berth 1/2 are accessed by naval vessels, fuel bunkering, and other assorted vessels. Berth 3 ship loading infrastructure is owned, operated and maintained by Co-Operative Bulk Handling (CBH) for the export of grain. CBH also owns and operates a train unloader within the Rail Terminal. Berth 3 is also accessed for cruise ship visits and import of minerals (self-discharge vessels). Berths 4 and 5 circuit and shiploaders are owned, operated and maintained by MWPA. These berths are primarily utilised for the export of iron ore, industrial minerals, mineral concentrates and sand. Berth 6 is accessed for fertiliser, minerals and fuel imports; cruise ship visits; livestock and mineral exports; and break bulk cargo. Berth 7 berth and ship loading infrastructure is owned, operated and maintained by Karara Mining in the export of iron ore. Karara Mining also owns, manages and maintains their dual wagon rail tipper. MWPA is responsible for the operation of the Rail Terminal, maintenance of three of the four rail tracks within the port and the bottom dump iron ore train unloading infrastructure. Environmental Licences MWPA owns and manages environmental licences for commodities exported and imported through the Port of Geraldton. Geraldton Fishing Boat Harbour MWPA manages Geraldton’s Fishing Boat Harbour (FBH) supporting the region’s largest fishing industry (primarily western rock lobster) and is home to Geraldton’s boat building and maintenance precinct. The FBH is equipped with mooring amenities including berthing and fuel facilities, waste disposal, utilities and security services. The FBH comprises 149 boat pens, ranging from 6 to 25 metres, a diesel fuel facility and significant landholding with sites leased to businesses that primarily support the local fishing, tourism and mining industries. 1.1 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 8
BERTH 1/2 BERTH 3 BERTH 4 BERTH 5 BERTH 6 BERTH 7 FISHING BOAT HARBOUR OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 9
Land Asset MWPA has a total of 83 hectares of land vested within the Port of Geraldton boundary and an additional 6.9 hectares made up of leases to the south of Marine Terrace. MWPA is responsible for land use planning and controls and acts as a landlord by leasing or licensing to the private sector. The private sector primarily owns and manages the assets on these lease sites. There are currently 52 separate commercial leases, along with various licences, that generate revenue for MWPA. In addition, 200 hectares of undeveloped farmland is reserved for future development of a deep-water port at Oakajee. This land constitutes a small portion of the total land requirements for future port development. MWPA has also received interest from a number of parties for alternative water and land access for renewable energy projects. Customers The effects of Covid-19 are still being felt across the world which has seen iron ore markets become increasingly volatile since November 2021. Due to its effect on the construction industry, there has been no construction sand exported through the Port of Geraldton this financial year. Although some markets have struggled through this financial year, several other industries have benefited from the positive market of solid demand and strong prices, along with another successful grain season. MWPA’s total throughput has increased by 1.3 million tonnes from the previous year, making the total throughput for the year just under 16.4 million tonnes. Mid West mining interest is still strong and MWPA have executed 24 cooperation agreements (a contract between two parties wanting to enter into a working relationship) with prospective customers this year, and three Port Services Agreements with two mineral sands and one fuel exporter, who will collectively export a further 0.5 million tonnes of product through the Port of Geraldton. Suppliers MWPA recognises that the local procurement of goods and services is key to developing the region in which it operates. With this in mind, the Port’s procurement activity is focused on the continued development of local suppliers to improve local capability. The current Procurement Strategy is well placed to incorporate further local opportunities to aid in the growth MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 10
OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 11
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of the region and to support its local supply base through the Western Australian Industry Participation Strategy (WAIPS) and Aboriginal Procurement Policies. The enhancements provided by the organisation’s Enterprise Resource Planning (ERP) tool, together with longer-term contracts continues to be an area of considerable focus for MWPA. MWPA is establishing long-term supplier relationships with local companies who will deliver value, innovation and optimisation, and are willing to partner with MWPA to deliver on its business strategies. Community MWPA continues to value and invest in its community presence and connections. In 2021/22, MWPA introduced its Not-For-Profit Partnership Program, a three-year rolling partnership providing financial funding and in-kind support, designed to build capacity in the Mid West community. The inaugural recipient of this program was Geraldton Surf Lifesaving Club. Additional community initiatives include: ■ Sponsorship of $202,355 toward community events and initiatives which align with MWPA’s organisational values and make a positive contribution to the community. This amount includes $100,000 per annum (for three years) towards the Shore Leave Festival; and ■ Beach Nourishment Program where MWPA has a Memorandum of Understanding (MOU) with the City of Greater Geraldton. In 2021/22 MWPA delivered 14,588m3 of sand, at a cost of $307,738, from Pages Beach as nourishment to stabilise erosion at the northern beaches of Geraldton. Security Maintaining a secure port is essential to ensuring that MWPA people and port users remain safe. It also ensures that trade can continue unhindered and that infrastructure remains available for the future. MWPA works closely with port users and customers to ensure that the port remains safe and secure. Like all security-regulated ports throughout Australia, port users must have an operational need to be on the port and possess a Maritime Security Identification Card (MSIC). MWPA is a recognised MSIC Issuing Body. With the impending introduction of an online MSIC application, a streamlined and flexible process will be introduced for the MSIC applicant. Cruise Industry MWPA supports Western Australia’s (WA) cruise tourism industry by acting as a transit port and aims to retain its Tier 2 status and grow its position to become a Tier 1 cruise destination port in time. In response to Covid-19, the federal government imposed restrictions that effectively banned domestic cruise ships (capable of sleeping 100 or more passengers), and all foreign cruise ships from operating within Australian waters, and from entering Australian ports. This ban was lifted on 17 April 2022, with the first cruise visit expected to Geraldton in late October 2022. MWPA did not receive any cruise visits during 2021/22. OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 13
644 25 1.2 Throughput 16,396 Total Trade Exports tonnes‘000 15,470 Total Trade Imports tonnes‘000 926 Total Trade Throughput tonnes‘000 10,335 tonnes‘000 Iron Ore Grain Mineral Sands Concentrates 3,294 tonnes‘000 1,313 tonnes‘000 527 tonnes‘000 644 tonnes‘000 Bulk Imports Petroleum General Cargo 257 tonnes‘000 25 tonnes‘000 2021/22 HIGHLIGHTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 14
Prosperity $96.7M Total Revenue and Income Profit After Tax $25.01M Payments to Government $8.9M Direct Local Spend $18.9M Seagrass Health Survey Completed Planet Benthic Community Habitat Survey Completed Reportable Environmental Incidents 2 People Not-For-Profit Partnership Program Annual Grants Program $102,355 $13,000 3.8 Total Recordable Injury Frequency Rate (TRIFR) Lost Time Injury Frequency Rate (LTIFR) 3.8 Fishing Boat Harbour Satisfaction 75% Community Reputation Suppliers Satisfaction 84% 34% Commercial Customers Satisfaction 73% Employee Satisfaction 64% Male Staff* *excludes casual employees 127 Female Staff* *excludes casual employees 37 OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 15
14.0 12.0 10.0 8.0 6.0 4.0 0 2.0 16.0 18.0 KEY BUSINESS RESULTS 1.3 Total Port Trade FY2018 FY2019 FY2020 FY2021 FY2022 Total Iron Ore Trade FY2018 FY2019 FY2020 FY2021 FY2022 14.0 12.0 10.0 8.0 6.0 4.0 0 2.0 15.9 Mass Tonnes (Millions) 15.9 14.9 15.1 16.4 12.0 10.9 10.8 10.1 10.3 Mass Tonnes (Millions) 16.0 18.0 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 16
Total Ship Visits FY2018 FY2019 FY2020 FY2021 FY2022 420 400 380 360 340 320 300 Economic Rate of Return on Assets FY2018 FY2019 FY2020 FY2021 FY2022 16 10 8 6 4 2 0 Operating Profit Before Income Tax Equivalent FY2018 FY2019 FY2020 FY2021 FY2022 40 35 30 25 20 15 0 Mid West Ports’ Conributions to State Government FY2018 FY2019 FY2020 FY2021 FY2022 25.0 20.0 15.0 10.0 5.0 0.0 10 5 Includes NTER & Dividends Paid 381 Visits 415 379 351 389 14.52 Profit ($ Million) 20.83 17.06 23.32 35.60 Percent 7.3 22.1 16.1 10.0 17.5 8.9 Contributions($ Million) 14.4 5.3 7.3 11.2 14 12 OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 17
COMBINED CHAIR & CEO REPORT Amidst a challenging environment in 2021/22, still complicated by Covid-19, Mid West Ports Authority (MWPA) has achieved strong operational and commercial performance and the successful completion of several key projects including the Wharf 4 Deck Strengthening Project and the 2021 Maintenance Dredging Campaign. A significant step in ensuring continued growth within the Mid West Region of Western Australia (WA) was also realised with the WA State Government committing to invest a total of $350M in the development of infrastructure within the Port of Geraldton (the Port) over the next four years. This project titled the Port Maximisation Project (PMaxP) will deliver new and upgraded multi-user, multi-product port facilities to cater for the forthcoming demand for import/ export pathways for numerous resource projects currently in planning or construction throughout the region. The PMaxP Project will also see a number of improvements to safety, reliability and efficiency in order to allow the Port to continue to operate successfully with an increased throughput of around 25 million tonnes per annum (Mtpa) in 2026 (up from 16.4Mtpa in 2021/22). Investment and the maintenance of infrastructure is a key element to the long-term sustainability of the Port, however, there is more to our port than just infrastructure. During 2021/22 MWPA continued our sustainability journey by commencing to integrate sustainability objectives into our usual business planning, business processes and decision making. Increasingly, reference will be made to the three pillars of sustainability (people, planet and prosperity), and incorporated into our broader strategy and future Statements of Corporate Intent and Annual Reports. To ensure MWPA achieves sustainability improvements year on year, MWPA has enlisted the assistance of a global ESG (Environmental, Social and Governance) benchmarking organisation, GRESB. GRESB collects and validates ESG data for a number of ports across Australia and the globe, and MWPA looks forward to sharing our progress in the years ahead. Prosperity Total trade throughput increased for the second year in a row with 16.4M tonnes passing through the Port, up from 15.1M tonnes in 2020/21 (9% growth). In August 2021, the Port saw the maiden iron ore shipment by CuFe (ASX:CUF) and it is expected that a number of new products and new customers will utilise the Port in the forthcoming financial year. Considerable growth in financial performance was realised with a Total Revenue of $96.14M, up from $75.84M in 2020/21 (27% growth). Similarly, Profit Before Tax grew with a return of $35.60M, up from $23.32M in 2020/21 (53% growth). 1.4 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 18
MWPA is projecting further growth over the coming years, with a number of resource projects commencing operations in the Mid West in the near future. As well as delivering new and enhanced infrastructure, the PMaxP Project will allow further diversification of trade and for MWPA to ensure ongoing resilience. The completion of the Wharf 4 Deck Strengthening and Rail Replacement Project was a significant milestone MWPA achieved in 2021/22. The wharf, which was at the end of its design life, was reinforced both above and below the original structure, ensuring Wharf 4 remains fit for modern operations for another 25 years. With around 50,000 hours of work completed without a Lost Time Injury, the project was completed within budget whilst remaining operational, facilitating the export of 1.2M tonnes of mineral sands and metal concentrates. The coordination achieved by MWPA’s project delivery, operations, maintenance, safety and environmental teams, to deliver the project in the manner they did, bodes well for the forthcoming delivery of other projects across the Port. Planet Over recent years, the Port has strengthened our understanding of the local natural processes, especially the natural migration of sand from south to north past the Port of Geraldton. Amongst our most critical assets are the navigation channel and harbour basin, with the channel providing a safe passage for vessels to navigate the shallows of Champion Bay into the commercial harbour. Over time the navigation channel has trapped some of this sand from travelling north and, as part of the Port’s first maintenance dredging campaign since 2012, in 2021 the Port was able to place this sand back into the nearshore environment to the north of the navigation channel. OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 19
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Noel Hart Chair Damian Tully CEO The 2021 Maintenance Dredging Campaign was undertaken after detailed studies, stakeholder consultation and an extensive muti-criteria analysis, with MWPA being able to achieve the beneficial reuse of all dredged material. The dredged material was placed where it was to have the least impact upon native flora and commercial and recreational activities. MWPA will continue sediment migration monitoring into the future to further understand natural sand migration in Champion Bay. The management of dust generation and dust migration received increased focus from MWPA over the last year. Wherever there is a transfer of bulk material from one location to another, there is a possibility that dust becomes airborne and is carried by the wind. Reducing the creation of dust and its carriage is of significant importance to MWPA in order to protect the environment, the community, and the livelihoods of the Port and our port users, including the Fishing Boat Harbour. In the last year, MWPA has established a cross-functional team dedicated to improving our performance in this area. Focus areas for this team have included the development of a comprehensive Dust Management Plan that sets standards for both MWPA and our port users, the study of the movement and velocity of wind throughout the Port precinct, the investigation and introduction of technologies to disrupt wind such as wind-taming fencing, the investigation and introduction of suppression systems to prevent dust from becoming airborne, and enhanced compliance activities in conjunction with our port users. People People remain our most critical asset and the value they bring to MWPA cannot be underestimated. MWPA strives to ensure we can attract talent to our organisation and that we develop and retain that talent into the future. In order to ensure we are prepared for future growth, MWPA continues to invest in a business improvement program that equips our staff with the ability to seek out solutions and efficiencies. Safety and culture have also been front of mind with engagement programs conducted in the last year to shape improved organisational performance. MWPA is proud to continue our active involvement in the local community of Geraldton and the Mid West Region. MWPA’s annual Community Grant Program this year awarded over $100K to organisations and programs which align with our values, and benefit the social, environmental and economic prospects in the region. 2022 also saw the introduction of the MWPA Not-For-Profit Partnership Program, a three-year rolling community program that enables capacity building in local NotFor-Profit organisations and promotes relationships and resilience in our volunteer community. MWPA was also proud to sponsor $100K for the second year running to Shore Leave, the Mid West’s premier seafood festival, celebrating Geraldton’s maritime history, aquatic lifestyle, culture, food and adventures unique to the region. Looking Ahead The future looks positive for MWPA as the Port embarks on the construction phase of PMaxP over the next four years, developing infrastructure covering transport, land acquisition, storage, materials handling, upgrades to Berths 1/2 and 6, as well as associated supporting infrastructure. An Engineering, Procurement and Construction Management (EPCM) project delivery approach is being implemented, with the EPCM contractor responsible on behalf of, but under the control of, MWPA, for ensuring the successful delivery of the PMaxP. Coupled with the organic growth of the Port through existing infrastructure, MWPA will continue to provide value to the region in the years ahead. Acknowledgements 2021/22 has been a critical year for MWPA in securing infrastructure funding and this could not have been done without the support of a number of key WA agencies including Department of Treasury, Department of Transport, Infrastructure WA, and Department of Jobs, Tourism, Science and Innovation. Thank you for your support. Finally, we would like to thank the Hon. Rita Saffioti BBus MLA, Minister for Transport; Planning; Ports, for her continued support and guidance throughout the last year and her critical support in helping to realise the future growth of Mid West Ports Authority. OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 21
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BOARD OF DIRECTORS NOEL HART Chair MBA, Master Mariner Class 1 SUSAN BARRERA Deputy Chair MBA, B ED, BSC (Hons) KATE WATSON Non-Executive Director GAICD GAIL MCGOWAN Non-Executive Director PSM, GAICD, BA PETER CREEK Non-Executive Director CA ROBERT WILLES Non-Executive Director GAICD, BA (Hons) 2.1 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 24
EXECUTIVE LEADERSHIP TEAM SANDRA PIGDON General Manager, Trade & Corporate Services LINDSAY MORRISON Interim General Manager, Operations & Logistics PETER DUPLEX General Manager, Asset And Infrastructure VICKIE WILLIAMS General Manager, Sustainability, Culture & People DAMIAN TULLY CEO 2.2 OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 25
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MWPA Board Executive Team Leadership Team LEGEND Mid West Ports Authority (MWPA) is governed by the board of Directors appointed by the Minister for Transport. MWPAcontrols operations at ports throughout the Mid West to facilitategrowth and trade for the economic benefit of the State. MWPAis responsible for the safe, secure, efficient and environmentallyfriendly operation of the ports. ORGANISATIONAL CHART Operations Manager Harbour Master/ Marine Manager Manager Projects & Technical Services Manager Maintenance Services Assets & Port Development Manager Human Resources Manager Sustainability Manager Safety Manager Procurement Specialist Manager Trade & Commercial Finance & Taxation Manager Information, Communications & Technology Manager Commercial Manager PMaxP General Manager Asset Development & Strategy General Manager Operations & Logistics General Manager Sustainability, Culture & People General Manager Trade & Corporate Services Project Director PMaxP Executive Officer Chief Executive Officer Board of Directors 2.3 OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 27
3.0 PERFORMANCE MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 28
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PERFORMANCE AGAINST TARGETS S T R A T E G Y O B J E C T I V E S GO A L S M E T R I C 2 0 2 1 / 2 2 T A R G E T 2 0 2 1 / 2 2 A C T U A L Objective 1 Facilitate, Protect and Grow Efficient Trade & Tourism Improve Revenue Diversification and Growth Return on Assets. 16% 14.40% Earning Before Interest, Taxes, Depreciation and Amortisation. $37.862M $42.705M No Product >50% of Throughput (Diversity). <70% 63% Total Port Trade. 18.2Mtn 16.396Mtn Total Number of Vessel Visits. 459 389 Review Exmouth with a Business Plan to Identify if it is a Commercial Opportunity. Jun-22 Cancelled. MWPA focussed on providing port planning oversight of proposed Exmouth private port facilities. Develop Common User Access and Materials Handling Corridor. Jun-22 In Progress through PMaxP. Improve Underlying Profit Economic Rate of Return. 11% 16.40% Debt to Equity Ratio Including Dividends. 0.045 0.04 Debt to Equity Ratio Excluding Dividends. 0.038 0.04 Develop Continuous Improvement Plan. Mar-22 Achieved. Map End to End Processes to Identify Opportunities for Improvement. Dec-21 Achieved. Improve Long Term Business Value Cost Base Improvement Point (2019 cost base). 10% -16% Implementation of Multi-User Port Facilities. Dec-21 In Progress through PMaxP Increase Regional Economic Contribution Total Local Spend. >70% 69% Delivery of Shore Leave Festival 2021-2023. Sep-21 Achieved. 3.1 State Goal Enhancing global competitiveness through continued economic diversification. Ports WA Metrics MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 30
State Goal Building strong & resilient regions through economic expansion and inter-regional collaboration. S T R A T E G Y O B J E C T I V E S GO A L S M E T R I C 2 0 2 1 / 2 2 T A R G E T 2 0 2 1 / 2 2 A C T U A L Objective 2 Enabling Supply Chain Facilitate Strong Strategic Partnerships Community Reputation Score. >80% 75% Review Maintenance Dredge Strategy Post 2021 Maintenance Dredge Campaign. Jun-22 Achieved. Finalise the Fishing Boat Harbour Development Plan. Dec-21 In Progress. Vision workshops complete. External consultation underway. Develop Strategic Partnership Plan. Oct-21 In Progress. Critical areas have been assessed with key stakeholders identified. Transparent Service Offering and Clear Role as Supply Chain Enablers Deliver 2021/22 SCI Projects. 100% All projects either underway (fire fighting, land acquisition, FBH development plan and road network upgrades) or complete (Wharf 4 upgrade and maintenance dredging). Finalise Continuous Improvement Training to all Staff Across Organisation. 100% 100% Facilitate Transfer of Useless Loop and Cape Cuvier Transfer Subject to Tranch 3 Legislative Reform. Dec-22 Deferred. Subject to State Government direction. Objective 3 Realising Development Provide Quality Infrastructure Compliance with Project Management Framework. 100% Project Management Framework is currently under redevelopment. Deliver Wharf 4 Deck Slab Strengthening and Rail Replacement. Dec-21 Achieved. Plan for the Future and Provide a Gateway for Trade and Tourism Reclaim and Cap Berth 7 Reclamation Area. Dec-21 In Progress. Maintenance dredge program did not provide sufficient fill to complete. State Goal Achieving efficiencies and synergy through infrastructure planning and coordination in pursuit of economic growth. Ports WA Metrics OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 31
State Goal Enhance conservation of the environment by sustainable development and efficient resource use. State Goal Enhancing sustainable communities by investment in infrastructure and social capital. S T R A T E G Y O B J E C T I V E S GO A L S M E T R I C 2 0 2 1 / 2 2 T A R G E T 2 0 2 1 / 2 2 A C T U A L Objective 4 Engaged Customers, Community and Stakeholders Run a Safe, Efficient and Cost Effective Service Offering. Availability of Berth 4 and 5 Ship Loading Infrastructure when Required by Customers. >98% 99.46% Availability of Train Unloading Infrastructure when Required by Customers. >98% 100% Border Breach - Covid-19. 0 0 Loss Time Injury Frequency Rate (LTIFR). 0 3.8 - MWPA implementing a psychological based safety program commencing 2022/23. Fire Fighting Port Wide Construction Phase 1. Jun-22 In Progress. Detailed design complete. Market engagement for construction underway. Completion of Plans for Marine Terrace Traffic Controls. Dec-21 Achieved. Upgrade Security Protocols for Port Entrance. Jun-22 Deferred in order to align with PMaxP design and construction. Engaged, Easy to do Business with and Deliver on our Promise. Customer Satisfaction Score (%) Commercial Harbour >80% 73% Customer Satisfaction Score (%) Fishing Boat Harbour >80% 34% - MWPA are in the process of implementing a number of dust improvement actions to increase amenity for the FBH community. Supplier Satisfaction Score. >80% 84% Employee Engagement Score. >80% 64% Community Projects Completed. 100% 100% Shape Government Policy and Legislative Reform. Develop an Implementation Plan for Changes to Workplace Health and Safety Legislation. Dec-21 Achieved. Objective 5 Operate in Balance with the Environment Improve Whole of Port Environmental Outcomes. Compliance with Environmental License, Legislation and Best Practice. 100% 100% Obtain Works Approval for the Increase in Annual and Daily Throughput Licence Limits to Facilitate Master Plan Growth Targets. Dec-21 In Progress. Daily throughput licence increase achieved. Licence amendment to increase annual throughput underway. Increase Environmental Advocacy and Transparency. Number of Reportable Environmental Incidents. <10 2 Implementation of Organisational Sustainability Reporting Metrics. Jun-22 In Progress. Baseline emission metrics complete. Sustainability reporting metrics submitted to GRESB for assessment and benchmarking. Ports WA Metrics MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 32
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MAJOR ACHIEVEMENTS ■ Maintenance Dredging Simulations at Geraldton final report published. ■ Contaminated Sites Voluntary Audit Report Submitted to DWER. ■ Geraldton Port Baseline Sediment Assessment – 20192021 published. ■ Marine Fauna Desktop Study published. ■ Maintenance Dredging of commercial harbour & shipping channel commenced. ■ 2021 Shore Leave Festival (delayed due to Cyclone Seroja, $100,000 funding provided in 2020/21). ■ Annual Environmental Report published. ■ Environmental Licence amended to include iron concentrates. ■ State Maritime Oil Spill Exercise ‘Champion Challenge’ successfully held. ■ First CuFe Ltd iron ore shipment exported from the Port of Geraldton. ■ Execution of new lease in the Fishing Boat Harbour to Dongara Marine, first new lease since 2014. ■ Seagrass communities in Chapman Bay and surroundings report published. ■ Maintenance dredging of commercial harbour & shipping channel concluded. ■ Awarded Office of Auditor General Best-Practice Agency (8th year running). ■ Strandline Resources executed a Port Services Agreement ahead of the commencement of its Coburn mineral sands project. ■ New Enterprise Agreements ratified by Fair Work Commission. ■ The final shipment of gas pipeline for the Northern Goldfields interconnect gas pipeline project. 35,000 tons of pipeline was delivered via 4 vessels over Berth 6. JUL 07/21 AUG 08/21 SEP 09/21 OCT 10/21 NOV 11/21 DEC 12/21 3.2 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 34
■ The vessel Great Wencheng departed Geraldton carrying a record 86,358 tonnes of iron ore. ■ Execution of ABRA’s Port Access Agreement to export 125,000T/ pa. ■ Inaugural Not-For-Profit Partnership Program recipient announced - Geraldton Surf Lifesaving Club. ■ Eastern Breakwater Tourist Jetty, design works commenced. ■ Marine Terrace Roundabout, design works commenced. ■ Maintenance Dredge Metocean Summary Report completed. ■ 2022 Environmental Management Plan published. ■ Appointment of CEO, Damian Tully. ■ Wharf 4 Refurbishment and Rail Replacement Project practical completion. ■ Post Dredge Benthic Habitat Survey completed (not yet received). ■ Post Dredge Seagrass Survey completed (draft report issued June). ■ Eastern Breakwater Tourist Jetty Environmental Impact Studies commenced. ■ $100,000 seed funding provided for 2022 Shore Leave Festival. ■ FBH Development Plan commenced. ■ Commencement of the Fishing Boat Harbour subdivision for the new boat building precinct. ■ Mid West Port Pilotage received International Standard for Maritime Pilot Organizations (ISPO) accreditation. ■ $350M funding approval for the Geraldton Port Maximisation Project (PMaxP). ■ Stakeholder & Community Survey completed. ■ Dust Management Plan published. ■ $102,355 of annual Community Grants Program recipients announced. ■ Port West Roads Project, design works commenced. ■ Relocated Pilot Boat Facilities, design works commenced. ■ Dredge Water Quality Summary Report completed. ■ HMAS Stalwart’s maiden visit to ceremonial homeport, Geraldton. ■ Integrated Operations Centre, Project Development Plan delivered. ■ Port Fire Fighting Project, design substantially complete. ■ Continuous Improvement Training complete. ■ Svitzer tug escort training certification achieved by Pilots and Tug Masters. ■ FBH Entrance Dredge Environmental Impact Assessment (draft report issued). ■ FBH Entrance Dredge Environmental Management Plan (draft report issued). JAN 01/22 FEB 02/22 MAR 03/22 APR 04/22 MAY 05/22 JUN 06/22 OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 35
Wharf 4 Strengthening and Rail Replacement Over the course of 12 months from March 2021 through to March 2022, Wharf 4 underwent a major refurbishment after reaching the end of its design life in 2015. Originally constructed in 1965, Wharf 4 is MWPA’s busy multi-user bulk minerals facility. Over time, numerous improvements and additions were made to the wharf to accommodate larger vessels and infrastructure capabilities. However, the deteriorating condition and capacity of the wharf were impacting operational efficiency to a level where a major refurbishment was a necessity. The refurbishment greatly enhanced the structural capacity of the wharf, allowing for the lifting of previously imposed load restrictions and allowing larger mooring capabilities. In addition, higher capacity mooring bollards and quick release hooks with remote operation and line load monitoring capability were installed. With a commitment to customers to maintain access to Wharf 4 during construction, works were staged and coordinated with shipping movements and planned shutdowns. During construction, 66 vessels were loaded on Berth 4, including 29 rotations/flips (some up to 9 times) to accommodate construction activities, approximately 1.27M tonnes was loaded and there was a vessel alongside the berth for 62% of the time. WA company Fortec was awarded the contract and recorded around 50,000 labour hours on the project with no Lost Time Injuries. The project workforce consisted of 55% local contractors, injecting several million dollars directly into the Mid West economy. KEY PROJECTS Some interesting project statistics include: ■ 1,350 m3 of concrete poured (around 270 concrete trucks) on the deck; ■ 400T of reinforcement was installed; ■ 6,342 bars drilled and grouted; ■ 14,500 vertical holes drilled through the existing deck for shear reinforcement; ■ 418m of new rail for the shiploader; ■ 200m of watermains were upgraded to HDPE and 5 new improved hydrants were installed; ■ Four 125T bollards were installed - the first of their type and capacity at MWPA; ■ 60m of access platform installed for safer use of shore tension units and mooring operations; and ■ Deck thickness increased from 380mm to 600mm. 3.3 MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 36
2021 Maintenance Dredging Routine hydrographic monitoring carried out by MWPA had seen a natural build-up of sediment in port berths, main port basin and the southern shipping channel in the years since the last maintenance dredging in 2012. The purpose of the 2021 maintenance dredging campaign was to return these areas to design depths by removing the built-up sediment. Accumulation of sediments reduced the available draft and spatial extent of these critical marine assets to such a degree that the original designed depths were no longer being achieved. This triggered the requirement to remove sediments to ensure ongoing navigational and environmental safety, and to enable the Port to efficiently operate. The Approach MWPA set itself a goal of 100% beneficial use of dredge material and set about achieving this using a threestage beneficial use assessment as recommended by PIANC (World Association for Waterborne Transport Infrastructure). This included: 1. Beneficial Use Options Identification Workshop; 2. Fatal Flaws Screening Analysis Workshop; and 3. Facilitated Multi-Criteria Analysis Workshop. The workshops were conducted with stakeholders to determine the best dredging methodology and dredge material placement options prior to the engagement of dredging contractors. 1. Beneficial Use Options Identification Internal workshopping with key MWPA personnel and external stakeholder consultation resulted in a total of 24 beneficial use options being identified. Including: ■ Agricultural; ■ Community coastal restoration projects; ■ Sand replenishment (nearshore and direct beach placement); and ■ Reclamation (existing and new). 2. Fatal Flaws Screening Following the identification of the preliminary options, MWPA conducted a pre-screening against fatal flaws which included: ■ Environmental fatal flaw: quality of sediments not suitable for use; ■ Engineering fatal flaw: the required equipment was not available or method of placement not practical or supported by stakeholders; and ■ Demand fatal flaw: feasible, practical but the option was superficial to community or stakeholder needs. Following the fatal flaw assessment eight options remained. 3. Multi-Criteria Analysis (MCA) Workshop MWPA enlisted the assistance of GHD to facilitate a four-step, multi-criteria assessment held with key MWPA personnel and stakeholders. The remaining eight options were assessed and following the MCA workshop the Port identified the preferred options. Material from within the berths and port basin were classified as mildly contaminated, and this material was placed into the Berth 7 reclamation area with tailwater discharge returning to the north-western corner of the Inner Harbour. The bulk of the dredging took clean sediment of natural origins from the main shipping channel and placed them in a nearshore Dredge Material Placement Area (DMPA), north of the channel, ~1km offshore from Bluff Point. Sediment movement out of the DMPA and its integration into the natural system of Champion Bay was modelled by GEMMS and is currently being monitored by MWPA. A Trailing Suction Hopper Dredge was engaged to remove the sediment, transport and place it in the desired locations. A bed-leveller smoothed out the remaining high spots and diver-supported rock removal was undertaken after the bulk of the dredging was completed. Environmental Impact Assessment An extensive environmental impact assessment (EIA) was undertaken, supported by key environmental studies to locate and optimise the most appropriate location for the nearshore DMPA and manage the land reclamation activities. Baseline water quality monitoring was undertaken, and seagrass and benthic community habitats were surveyed to ensure the health, cover and density of habitats were well understood. Computerised modelling was undertaken to determine the extent and concentration of sediment plumes that might be generated by dredging and material placement activities. This modelling predicted no significant impacts for marine fauna, seagrasses or benthic habitats. In addition to the EIA, extensive stakeholder consultation was undertaken with regulatory agencies, the community, customers and workforce to ensure concerns were addressed as part of designing and managing the dredge program. Dredge Environmental Management Plan A detailed environmental management plan was developed to manage and mitigate any potential impacts on the environment and address stakeholder concerns. A key component of this plan was pre-, during OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 37
and post-dredge environmental monitoring programs to identify and address impacts should they occur. Long-term benefits of introducing more sediments back into Champion Bay are yet to be validated. It will take 2 to 3 years of post-dredge monitoring to understand if the computerised modelling predictions hold true. Sediment migration from the DMPA is hoped to: ■ Promote greater seagrass health and biomass; and ■ Build coastal resilience and strengthen natural coastal processes. Environmental Outcomes All Environmental Performance Outcomes were achieved for the Project which included: ■ No irreversible loss or serious damage to marine habitats occurred outside the dredge footprint and nearshore DMPA; ■ No detectible reduction from the baseline state of benthic communities were observed outside of the dredge footprint and nearshore DMPA; ■ Water quality criteria was met during dredging and returned to pre-dredge conditions within one month of the end of the program; and ■ Dredge material was returned to the natural coastal sediment cycle using the nearshore DMPA. Ongoing and long-term environmental monitoring programs continue to determine how successful the nearshore placement of dredge material has been in supporting the natural sediment cycle and coastal stability to support using the nearshore placement area again in future maintenance dredging campaigns. Project Outcomes The dredging campaign successfully removed and placed approximately 145,000m3 of accumulated MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 38
Dredge area Target depth m below LAT Pre-dredging declared depth m below LAT Post-dredging declared depth m below LAT Berth 1 9.8 7.9 8.4 Berth 2 9.8 7.9 8.4 Berth 3 13.4 11.9 12.6 Berth 4 13.4 11.7 12.7 Berth 5 13.4 12.1 13 Berth 6 13.4 11.3 11.8 Berth 7 13.4 12.3 12.5 Inner Harbour Basin 12.4 12.1 12.2 sediments with 100% of dredged materials being beneficially re-used. 13,226m3 was removed from the inner harbour and placed in the Berth 7 reclamation area, and 130,428m3 was removed from the main channel and placed in the nearshore DMPA. Dredging resulted in a significant improvement in the navigational depth and width of the channel and Inner Harbour. However, the campaign was not able to sufficiently achieve the target depths to allow declaration to the full target design. The following observations were made: ■ Increase in berth depths (refer to the table below). The target design depths were not achieved primarily due to material remaining behind and immediately adjacent to the fender line. Despite best endeavours, the dredge and bed-leveller were unable to physically remove sufficient sediment from behind the fender lines to achieve target depths. It was considered that the dredge and bed leveller had achieved the maximum that could be safely and efficiently achieved with the equipment. ■ Increase in channel depths and a large increase in channel widths were achieved. The previous large exclusion zones (up to 50m) were reduced to 5m, with the exception of two channel nodes where a 10m exclusion remains due to rocks. Within the channel, sediment was removed to within 0.2m of the target design. Across the majority of the channel, the declared depths were limited by the presence of large rocks. Due to the number of rocks requiring removal by divers, rock target removal was prioritised until a balanced under keel clearance was achieved over the channel, beyond which continued rock removal would have limited benefit. ■ Bedrock not removed during previous capital dredging campaign limited depth in several locations: ■ Berth 7 depth is limited by the presence of bedrock along the southern edges of the berth pocket; ■ Berth 1 depth is limited by an assumed rock ledge adjacent to a portion of the berth face; and ■ The outer end of the channel contains several isolated high spots of bedrock. MWPA will continue to improve its maintenance dredging strategy to optimise berth depths with lessons learned from the 2021 program. These include early planning, increasing dredging frequency of lesser volumes, undertaking additional berth pocket dredging and target bed-levelling and diver supported rock removal. LAT - Lowest Astronomical Tide OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 39
Exercise Champion Challenge From 19th-21st October 2021, MWPA and the Department of Transport (DoT) hosted a biennial WA State level oil spill exercise. The 2021 event, named ‘Exercise Champion Challenge’ honouring Geraldton’s Champion Bay in which MWPA operates, simulated an oil spill at the Port of Geraldton. This provided an opportunity to test the multiagency (local and state level) response for a Level 2 oil spill incident. The exercise involved over 160 participants across incident management, crisis management, field response and exercise control. The agencies participating in the exercise included MWPA, DoT, Department of Biodiversity, Conservation and Attractions (DBCA), Department of Fire and Emergency Services (DFES), City of Greater Geraldton (CoGG) and various other WA port authorities. Commencing with a simulated Level 1 oil spill in the Geraldton inner harbour early on the morning of October 19th, under challenging weather conditions, MWPA assumed responsibility as Controlling Agency with the Harbour Master acting as Incident Controller. With the exercise being practised in real-time, DoT response teams from Perth were mobilised immediately to assist. The oil spill transitioned to a Level 2 incident with oil “escaping” to the outer harbour, requiring considerable resources and multiple shifts for response efforts. On Day 2 of the exercise, the Controlling Agency responsibilities were transferred from MWPA to DoT requiring the practice of handover, in addition to assimilating from one agency to a multiple agency response operation. The incident response continued into Day 3 of the exercise with actual and simulated deployment of multiple marine, shoreline, inshore booming and oiled wildlife strike teams. At the conclusion, an End-of-Exercise debrief was undertaken wherein the key findings and lessons learnt were discussed. Exercise Champion Challenge provided the opportunity for WA State Government agencies, industry and port authorities to test their emergency response plans and work collaboratively in responding to a Level 2 Maritime Environmental Emergency within a port. The exercise also offered excellent training and exposure to emergency response activities for all participants, particularly in a multi-agency response setting. Lead exercise agency DoT reported the exercise as a success, greatly enhancing MWPA’s response readiness to deal with any future oil spill incidents. MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 40
PMaxP Expansion Plan In 2020, MWPA released its latest Port Master Plan (PMP) which provided a high-level analysis of potential trade growth and required infrastructure to accommodate this growth over a 30-year planning timeframe at the Port of Geraldton. Most specifically, it considered the development required over the next 15 years to maximise the throughput and efficiency of the Port. Shortly after the release of the PMP, MWPA saw a significant firming of future trade requiring further infrastructure and commenced planning to increase throughput capacity within the current footprint of the Port. That plan is the Port Maximisation Project or PMaxP. PMaxP seeks to increase efficiencies across the entire Port whilst also focussing on increasing storage and export capacity. The growing presence of exporters who were looking to export quantities of resource products of approximately 1 to 2 Mtpa drove MWPA to consider proposed solutions capable of facilitating multiple customers and multiple products. In mid-2021, MWPA finalised the PMaxP conceptual plan and business case, incorporating the following elements: ■ A multi-user, multi-product storage shed (~300,000 tonnes in capacity); ■ Linkage between the new shed and wharf via covered conveyors; ■ A new truck unloader facility for Berth 4 capable of receiving triple trailer road trains of all configurations (side-tippers, rear-tippers and bottom dumpers); ■ The demolition and rebuild of Berth 1/2 into a single, modern, export facility; ■ Dredging of Berth 1/2 berth pocket to allow for modern vessels; ■ Extension of Berth 6 wharf and berth pocket to allow for increased vessel size and the alignment of Berth 5 and Berth 6 berth faces; ■ Consolidated and modernised offices, facilities, storerooms and workshops for MWPA staff; ■ Road realignments and improvements across the port to increase safety and efficiency; ■ New facilities for tugs and pilot boats to cater for current and future operations; and ■ New pilot boat and lines boat to facilitate current and future operations. With the conceptual plan and business case finalised, MWPA worked closely with several key State Government departments and agencies to refine the proposal including; Department of Treasury, Department of Transport, Infrastructure WA (IWA) and the Minister for Ports Office. The business case was also the first proposal to be assessed and supported by IWA through the Major Infrastructure Proposal Assessment framework. As part of the State Budget process, MWPA submitted the PMaxP business case for the detailed design ($18M) and construction ($332M), both of which were subsequently approved by State Government. This significant investment will allow MWPA to continue to facilitate current trade by the most efficient means, and provide opportunities for future importers and exporters in the Mid West region. MWPA will award an EPCM (Engineering, Procurement and Construction Management) contract in 2022/23, who will be responsible for the detailed design and manage the construction of PMaxP. Construction works are anticipated to commence in 2023 and are likely to take four to five years to complete. OVERVIEW OPERATIONAL STRUCTURE PERFORMANCE GOVERNANCE ANNUAL FINANCIAL STATEMENTS MID WEST PORTS AUTHORITY ANNUAL REPORT 2021/22 41
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