Aussies to mine weapons testing ground

South Australian Premier Mike Rann. Photo / Richard Robinson

Australia has dismantled much of its last remnant of the Cold War to open massive new mining reserves across an area the size of England worth at least A$35 billion ($48 billion).

A deal between the federal and state governments will allow miners access to vast storehouses of gold, copper, iron ore and uranium in the Woomera Prohibited Area, the nation's secret weapons testing ground in outback South Australia.

Identified potential on the 127,000sq km area - closed throughout the Cold War and used for British nuclear tests, weapons development and space launches - include 62 per cent of Australia's known copper reserves and 78 per cent of its known uranium reserves. But the area remains largely unexplored, and more may yet be discovered.

"For South Australia this decision is like a new frontier unlocking and finding a new country that is bigger than England and which previously has been largely prohibited from mining", State Premier Mike Rann said. "This is about jobs. It's about an economy that's now on the move. This is a guarantee of wealth for the future."

The prohibited area is part of the wider Woomera range, established about 500km north of Adelaide in 1947 under an agreement with Britain to develop nuclear warheads and ballistic missiles.

Seven major nuclear tests were conducted on the range, and more than 6000 rockets were launched until the agreement with Britain ended in 1977.

The range is still used for secret weapons development and testing by the Australian Defence Force, which means that an area known as the "red zone" will remain closed to miners for at least five years, when a further review will be held. A South Australian geological team will in the meantime be allowed access to determine further potential.

Mining will be allowed in two other zones - named green and amber - with restrictions applying to them but still opening up huge resource potential.

Miners could be excluded from the green zone for up to 56 days a year, and for between 10 and 20 weeks in the amber zone.

The decision to open the prohibited area under what federal Resources Minister Martin Ferguson described as a "timeshare" arrangement followed a review by former Defence Secretary Allan Hawke.

With 120 exploration licences already granted, the final opening of the area is still subject to further detailed negotiations and the passage of new enabling legislation, expected to take at least a year.

Defence Minister Stephen Smith said the prohibited area remained a crucial asset for weapons and missile testing and for defence force training, but the new arrangements would serve both the nation's security and economic interests.

Rann said the opening of the area was critically important for the state, with mining now South Australia's largest export-earner and the number of mines increasing from four to 16 in the past six years, with another 30 in various stages of application.

He said developments in the area could be of the scale of BHP Billiton's immense Olympic Dam mine 560km north of Adelaide, now awaiting approval for an expansion that will double its capacity.

It is the world's fourth largest remaining copper deposit, fifth largest gold deposit and the largest uranium deposit.

"At Olympic Dam, which is just outside of the border of the prohibited area, we are talking about thousands of jobs for more than 100 years, and it is a resource that is valued at more than A$1.4 trillion."