Construction of $9bn Roy Hill iron ore mine kicks off, no $2-a-day workers needed

The construction contract of the Roy Hill iron ore mine in the Pilbara – the biggest to emerge in Australia in decades – has been awarded and building starts next week.

Korean chaebol Samsung was awarded the $5.6 billion contract which includes railroad and port infrastructure and The Australian reports scheduled completion is set for November 2015 according to a Samsung filing with the Korean stock exchange.

A year ago the massive project – which has a final bill of $9.5 billion and will produce 55 million tonnes per year at full tilt – was the first to be allowed to import foreign workers under the Australian government's Enterprise Migration Agreement (EMA).

But in February Roy Hill executives said that the labour shortage in Australia of the past few years has improved to such an extent that it was in a position to source all 8,000 construction workers needed locally and would no longer use the 1,715 foreign worker permits it was granted.

Gina Rinehart's Hancock Prospecting owns a 70% interest in the project, South Korea's Posco and STX Corp holds 15%, Japanese firm Marubeni has a 12.5% stake while Taiwan's China Steel Corp holds the remainder.

Rinehart, Australia's richest person with a personal fortune of $18 billion, was one of the main driving forces behind the EMA, but also came in for a lot of criticism about her comments that Australians should "spend less time drinking, smoking and socialising and more time working" and that local miners should imitate hardworking Africans who are willing to labour for $2 a day.

Importing labour for mining projects is a controversial issue around the world.

Clashes between Chinese workers and artisanal gold miners in places like Ghana is a regular occurrence, while strife between local workers and expat managers at Zambia's Chinese-owned copper mines remains a contentious issue in the Southern African country.

A controversy also erupted in British Columbia after work permits were issued to as many as 2,000 Chinese workers for a coal mine in the Canadian province because no suitable local candidates were found.

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