Western Australia’s continued economic growth over many years has been made possible by substantial investments in the resources sector.
In many cases, proponents commit to these significant projects on the basis of a contract specifying terms and conditions with the Western Australian Government for the development of the resource. These terms and conditions are contained within what are known as State Agreements, which are ratified by Acts of Parliament.
A State Agreement is a legal contract between the Western Australian Government and a proponent of a major project within the boundaries of Western Australia. It is a highly visible sign of the state’s support for and commitment to the project. State Agreements detail the rights, obligations, terms and conditions for the development of the specific project.
State Agreements have been used by successive governments since the 1950s to secure major resource projects, particularly those that require the development of railways and ports, and long-term tenure. Under such agreements, proponents take or share responsibility with the state for developing infrastructure specific to the project.
Over time, local content provisions have also been incorporated into State Agreements. One example of this is the agreement entered into as part of the Gorgon Project, which requires the use of local labour, suppliers and professional services where it is reasonable and economically practicable to do so. The proponents are also required to provide local suppliers with a fair opportunity to tender or quote during design and the tendering and letting of contracts.