Boom towns ready for slow death

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Sky-high property prices and the grim quality of life in many Queensland mining towns have forced changes in the way mining companies accommodate their workers, with disastrous consequences for investors


Fridays are ‘fight night’ at Moranbah pubs. That’s according to many of the local residents of this mining community in the Queensland outback, who complain that their town has become something of a haven for singlet-wearing blokes on the turps.

With men outnumbering women almost three to one, it’s no surprise that the town isn’t everyone’s idea of the perfect place to live. Summer temperatures hover around the 40 degree mark and the local population is one of Australia’s most itinerant. Some residents report enjoying life in the bush, but just as many have a three or five year plan to make a shed load of money and leave.

But perhaps the biggest complaint from residents has been – at least until recently – Moranbah’s high property prices, which had been fuelled by a severe shortage of land brought about by the mining boom. Last year, the median price of a house was $724,000, which was double what it had been the five years before that. The average rent was also a cool $1,800 a week – more expensive than any capital city suburb.

Today, that landscape has changed.

The latest RP Data figures show that Moranbah properties are considerably cheaper than they used to be. The median house price is now just $513,000 and rents have slid to the much more reasonable average weekly figure of $650.

Nearby mining town Dysart hasn’t fared better. Average rent has crashed from $1,400 a week in August last year to $450 a week in August this year. It’s also been the same in mining locale Blackwater, where the figure for median weekly rent was $900 last year, but is $523 this year.

The cause
One could put the sharp drops down to an oversupply of houses on the market – there has certainly been a lot of building activity in these areas – but, according to Hotspotting director Terry Ryder, the real culprit is the mining companies.

Ryder says that many of the big mining houses have been in cost cutting mode and have turned to a growing pool of fly-in, fly-out (FIFO) workers and drive-in, drive-out (DIDO) workers. These workers are choosing to bypass the towns that surround the mines they work in; commuting from another location they deem more “desirable” to live in.

Mining companies have also warmed up to the concept of mining camps – areas where the companies provide nearby, temporary houses for their staff who work the mines.

“FIFO and miners’ camps were once the exception. Now they’re the norm,” says Ryder. “We’re moving towards a situation where everyone working on a new mine will be on a FIFO roster and no one will live in the local town.”

FIFO trends
A spokesman from mining conglomerate BHP Billiton confirms that FIFO represents a growing component of their workforce. “The reality is that, for many people, working remotely suits their lifestyle or personal circumstances. We often have requests for FIFO as an employment option – it is a personal choice,” she says.
She adds that a FIFO approach has been born out of necessity. There has been a growing awareness that some of the local towns surrounding mines do not have the amenities their workers crave.

“Many of BHP’s operations are remotely located and do not have a nearby regional centre with the population, services or infrastructure sufficient to attract the numbers of people required.  This means it is not practical to have a residential based workforce for these operations.”

The town that could have been
A sign of changing times has perhaps been best illustrated in Alpha – a hamlet in the Galilee Basin that’s roughly 100km west of Emerald and in a patch of outback most would consider the middle of nowhere.

Five mining companies recently turned up at the town eager to exploit its thermal coal reserves, but evidence that Alpha is unlikely to be the next boom town is that all five have indicated they will operate FIFO crews and accommodate their workers within onsite camps. The town’s airstrip is to be upgraded, but mining activity will completely bypass the town.

Terry Ryder comments in Hotspotting’s Ryder Report that the way local residents have responded may become something of a theme for mining areas. “Locals have got over their early euphoria,” he says. “Otherwise it looks like business as usual for the town.”  

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