Evaporites (Lake MacLeod) Agreement Act 1967

not later than the 30th day of the sixth month after the commencement date commence to construct and thereafter will diligently proceed with the construction and establishment on the work sites of a plant for the mining and extraction of potash from brine and the loading thereof into ships at the wharf and such plant and other necessary works shall within three years after the commencement date be capable of producing and loading into ships at the wharf not less than 75,000 tons of potash per annum and within five years after the commencement date be capable of producing and loading into ships at the wharf not less than 200,000 tons of potash per annum and by this latter date the Company shall have expended on the project a sum of not less than $13,000,000;

progressively increase the capacity of its plant and other necessary works until by the end of the eighth year after the commencement date they shall be capable of producing and loading into ships in a form suitable for sale not less than one million tons of evaporites (including potash) per annum;

construct the wharf in accordance with plans and specifications previously approved or determined hereunder on the site previously approved or determined for the purpose and dredge the berth at the wharf turning basin and the channel and approaches to the wharf to a depth suitable for the purposes of the company;

carry into effect all the detailed proposals agreed or determined hereunder;

at all reasonable times at the request of the State whilst the wharf is being designed and the specifications being drawn make available on the Company’s behalf a person for consultation with the officers servants or agents of the State in respect of the design of the wharf or of the specifications therefor;

subject to the State having assured to the Company all necessary rights in or over Crown lands or reserves available for the purpose construct such new roads as the Company reasonably requires for its purposes hereunder of such widths with such materials gates crossings and passovers for cattle and for sheep and along such routes and crossing such public roads at such places and in such manner as the parties hereto shall mutually agree after discussion with the respective Shire Councils through whose districts any such roads may pass and subject to prior agreement with the appropriate controlling authority (being a Shire Council or the Commissioner of Main Roads) as to terms and conditions the Company may at its own expense and risk except as otherwise so agreed upgrade or realign any existing road but nothing in this paragraph (f) provided shall derogate from the provisions of clause 8(7)(g) hereof;

unless the Minister prior to the expiration of the respective terms firstly mentioned in subparagraphs (A) and (B) advises the Company that he does not require the submission of the programmes hereinafter mentioned then the Company shall submit to the Minister —

within the term of ten years following the commencement date —

a firm programme for expansion of production during the period from the beginning of the eleventh year to the end of the twentieth year after the commencement date (hereinafter called “the first programme”) and

a tentative programme for expansion of production during the period from the beginning of the twenty‑first year to the end of the thirtieth year after the commencement date (hereinafter called “the tentative programme”) and

within the term of twenty years following the commencement date a firm programme for expansion of production during the period from the beginning of the twenty‑first year to the end of the thirtieth year after the commencement date (hereinafter called “the second programme”)

the Company in carrying out its first programme will not by the end of the twentieth year achieve an annual production as shall make use of at least sixty seven per centum of the annual capacity of the mineral lease having regard to the then reasonably estimated quantity of brines and the area then suitable and available for evaporation pans or

the Company in carrying out its second programme will not by the end of the thirtieth year achieve an annual production as shall make use of approximately one hundred per centum of the annual capacity of the mineral lease having regard to the factors aforesaid and if the Minister having due regard to known anticipated market conditions availability of finance and physical factors relevant to the practicability of increased production is of the opinion that the particular programme does not assure that the resources of the mineral lease will be exploited to the fullest extent reasonably practicable he may within three months of his receipt of that programme give notice to the company of the extent of the alleged inadequancy and unless within six months of such notice a programme is agreed either the Minister or the Company may within a further period of three months refer the matter to arbitration and the arbitrator shall take into account all factors which would by likely to affect the economics of expansion and if —

where the matter is not submitted to arbitration a programme is not agreed within three months of the expiration of the last mentioned period of six months or

the arbitration results in a finding that the Ministers particular opinion is justified and a programme is not agreed within three months of the date of the award and in accordance with the terms thereof

in the event of there being no agreement as to the first programme require the Company as from the end of the eleventh year or such later time as shall be reasonable having regard to the date of any award as mentioned above to reduce the area of that part of the mineral lease from which brines and evaporites are being mined but so as not to reduce the reserves of brines and evaporites to an extent that would prevent the Company from ultimately expanding its capacity for production to a level one and one half times the maximum indicated in the tentative programme;

in the event of there being no agreement as to the second programme require the Company as from the end of the twenty‑first year or such later time as shall be reasonable having regard to the date of any award as mentioned above to reduce the area of that part of the mineral lease from which brines and evaporites are being mined but so as not to reduce the reserves of brines and evaporites to an extent that would prevent the Company ultimately expanding its capacity for production to a level one and one half times the maximum indicated in the second programme;

agree that the extent and manner of any such reduction of the mineral lease shall be decided by agreement between the Minister for Mines and the Company but failing any such agreement within two months of the Minister notifying the Company of his intention to effect such reduction the matter shall be referred to arbitration and the mineral lease shall be reduced to the extent and in the manner agreed or determined by arbitration;

agree to the State leasing any area subtracted from the Company’s lease as aforesaid to any person for the purpose of producing evaporites thereon but so that the terms of such lease and other arrangements between the State and the other person shall not unduly interfere with or jeopardise the established works operations or markets of the Company and shall not be more favourable on the whole than those granted to the Company having regard to the area made available to such other person; and

implement any expansion of production as set forth in the first or second programmes of the Company as are agreed between the Minister and the Company or programmes proposed by the Company as are determined by arbitration as aforesaid as being programmes which assure that the resources of the mineral lease will be exploited to the fullest extent reasonably practicable provided that if the Company is unable to implement the programmes because changed world conditions make finance unavailable or other unforeseen circumstances cause the Company to be unable to make such implementation the Company may submit to the Minister a proposal for revised programmes and if within three (3) months of such submission the Minister and the Company do not agree on revised programmes the matter shall be submitted to arbitration as herein provided but so that nothing in this clause provided will be deemed to limit the right of the Company to make expansions whether or not the same are set forth in such programmes.

Throughout the continuance of this Agreement the Company shall —

subject to and in accordance with by‑laws (which shall include provision for reasonable charges) from time to time to be made and altered as provided in paragraph (e) of subclause (2) of clause 8 and subject thereto or if no such by‑laws are made or are in force then upon reasonable terms and at reasonable charges (having regard to the cost thereof to the Company) allow the State and third parties to use the Company’s wharf wharf machinery and equipment and wharf services and (subject to paragraphs (w) (x) and (y) of clause 10) approaches to the wharf PROVIDED THAT such use shall not unduly prejudice or interfere with the Company’s operations hereunder and that the entire control of and all personnel for or in respect of such use shall be provided by or with the approval of the Company;

except to the extent that the Company’s proposals as finally approved or determined hereunder otherwise provide allow the public to use free of charge any roads constructed or upgraded under this clause PROVIDED THAT such use shall not unduly prejudice or interfere with the Company’s operations hereunder;

in the construction operation maintenance and use of any work installation plant machinery equipment service or facility provided or controlled by the Company comply with and observe the provisions hereof and subject thereto the laws for the time being in force in the said State;

at all times keep and maintain in good repair and working order and condition and where necessary replace all such works installations plant machinery and equipment and the roads (other than the public roads referred to in clauses 8(7)(g) and 10(b) hereof) for the time being the subject of this Agreement;

pay to the State royalties:

on all potash from the mineral lease shipped or sold (other than such as shipped solely for testing purposes) in the amount of fifty cents (50c) per ton;

on all common salt from the mineral lease shipped or sold (other than such as shipped solely for testing purposes) computed as set out hereunder: —

on all other evaporites from the mineral lease shipped or sold (other than such as shipped solely for testing purposes) at the rate of two per centum (2%) of the f.o.b. revenue received therefor (computed at the rate of exchange prevailing on date of receipt by the Company of the purchase price in respect of such evaporites shipped or sold hereunder); and

tonnages shall be ascertained in such a manner as the parties hereto may from time to time agree upon;

within fourteen days after the quarter days being the last days of March June September and December in each year commencing with the quarter day next following the first commercial shipment of potash or common salt furnish to the Minister for Mines a return showing the quantity of all potash common salt and other evaporites the subject of royalty hereunder and shipped during the quarter immediately preceding the due date of the return and shall not later than two (2) months after such due date pay to the Minister for Mines on account of the royalty payable hereunder a sum calculated on the basis of tonnage or f.o.b. revenue derived from invoices or provisional invoices (as the case may be) rendered by the Company to the purchaser (which invoices the Company shall render without delay simultaneously furnishing copies thereof to the Minister for Mines if requested) of such potash or common salt or other evaporites and shall from time to time in the next following appropriate return and payment make (by the return and by cash) all such necessary adjustments (and give to the Minister for Mines full details thereof) when the actual tonnage or f.o.b. revenue realized (as the case may be) in respect of the shipments shall have been ascertained;

permit a nominee of the Minister for Mines to inspect at all reasonable times the books of account and records of the Company relative to the mining of evaporites and any sale or shipment thereof and to take copies or extracts therefrom so far as is necessary for the purpose of determining the revenue payable in respect of potash common salt and other evaporites shipped or sold hereunder and the Company will take reasonable steps to satisfy the State either by the certificate of a competent independent party acceptable to the State or otherwise to the reasonable satisfaction of the Minister for Mines as to all relevant weights and analyses and will give due regard to any objection or representation made by the Minister for Mines or his nominee as to any particular weight or assay of potash common salt or other evaporite which may affect the amount of royalty payable hereunder; and

use its best endeavours to obtain for the potash common salt and other evaporites the best price possible having regard to market conditions form time to time prevailing.