Sch 3Second Variation Agreement

Schedule 3 — Second Variation Agreement [s. 5] [Heading inserted: No. 29 of 1994 s. 10; amended: No. 19 of 2010 s. 4.] **THIS AGREEMENT** is made the 31st day of March 1994 B E T W E E N : **THE HONOURABLE RICHARD FAIRFAX COURT** B.Com., M.L.A., Premier of the State of Western Australia, acting for and on behalf of the said State and its instrumentalities from time to time (hereinafter called “the State) of the one part AND **BHP IRON ORE (JIMBLEBAR) PTY. LTD.** ACN 009 114 210 (formerly called Hancock Mining Limited) a company incorporated in the State of Western Australia and having its registered office at Level 18, 200 St George’s Terrace, Perth (hereinafter called “the Company”) of the other part. (a) the State and the Company (pursuant to certain assignments) are now the parties to the agreement (as amended from time to time) the execution of which was authorized by *the Iron Ore (McCamey’s Monster) Agreement Authorization Act 1972* (hereinafter called “the Principal Agreement”); (b) the State and the Company wish to vary the Principal Agreement. NOW THIS AGREEMENT WITNESSES — 1. Subject to the context the words and expressions used in this Agreement have the same meanings respectively as they have in and for the purpose of the Principal Agreement. 2. The State shall introduce and sponsor a Bill in the State Parliament of Western Australia to ratify this Agreement and endeavour to secure its passage as an Act prior to 31 December 1994 or such later date as may be agreed between the parties hereto. 3. (1) The provisions of this Agreement other than this Clause and Clauses 1 and 2 shall not come into operation unless and until — (a) the Bill to ratify this Agreement as referred to in Clause 2; and (b) Bills to ratify the following agreements of even date herewith, namely: — (i) an agreement between the State of the one part and BHP Minerals Pty. Ltd. of the other part called the Iron Ore Processing (BHP Minerals) Agreement; (ii) an agreement between the State of the one part and BHP Iron Pty. Ltd., BHP Australia Coal Pty. Ltd., CI Minerals Australia Pty. Ltd. and Mitsui Iron Ore Corporation Pty. Ltd. of the other part to vary the Iron Ore (Mount Goldsworthy) Agreement; and (iii) an agreement between the State of the one part and BHP (Minerals) Pty. Ltd., Mitsui Iron Ore Corporation Pty. Ltd. and CI Minerals Australia Pty. Ltd. of the other part to vary the Iron Ore (Marillana Creek) Agreement are passed as Acts before 31 December 1994 or such later date if any as the parties hereto may agree upon. (2) If before 31 December 1994 or such later agreed date the said Bills have not commenced to operate as Acts then unless the parties hereto otherwise agree this Agreement shall then cease and determine and no party hereto shall have any claim against any other party hereto with respect to any matter or thing arising out of, done, performed, or omitted to be done or performed under this Agreement. (3) On the said Bills commencing to operate as Acts all the provisions of this Agreement shall operate and take effect notwithstanding the provisions of any Act or law. 4. The Principal Agreement is hereby varied as follows — (1) **Clause 1** — in the definition of **“approved proposal”**, by inserting after “Clause 8”, where it secondly occurs, the following — “and includes proposals approved or deemed to be approved under Clauses 9 or 11A”. (2) **Clause 9(1)** — by deleting “If” and substituting the following — “Subject to Clause 11A, if”. (3) **Clause 9(2)** by deleting “or if as a consequence of their submitting detailed proposals pursuant to Clause 33 the Minister requires further detailed proposals to be submitted on any of the said matters mentioned in paragraphs (a) ‑ (m) of subclause (2) of Clause 7” and substituting the following — “or Clause 11A”. (4) **Clause 11A** by inserting after Clause 11 the following clause — **Limits on mining** “ 11A. (1) In this Clause — **“aggregate project cost under the Processing Agreement”** means the sum of $400,000,000 (June 1993 dollars) which is agreed or determined for the purposes of Clause 27 of the Processing Agreement to have been expended on the establishment of facilities for further processing or alternative investments pursuant to that Agreement; **“approved production limit under this Clause”** means the production level (if any) of tonnes of iron ore per annum for transportation from the mineral lease which has been consented to from time to time by the Minister pursuant to subclauses (5) or (6) of this Clause and which is the subject of proposals approved or deemed to be approved pursuant to subclause (7) of this Clause; **“BHP”** means BHP Minerals Pty. Ltd. and its successors and assigns who are parties with the State to the Processing Agreement; **“combined limit”** means the aggregate of — (i) any approved production limit under this Clause; (ii) the approved production limit under Clause 11 of the Marillana Creek Agreement; and (iii) any approved production limit under Clause 12 of the Mount Goldsworthy Agreement PROVIDED THAT if any of the approved production limits referred to in paragraphs (i), (ii) or (iii) exceeds 15,000,000 tonnes per annum then in calculating the combined limit such approved production limit shall be treated as being 15,000,000 tonnes per annum; **“Marillana Creek Agreement”** means the agreement (as amended from time to time) ratified by the *Iron Ore (Marillana Creek) Agreement Act 1991*; **“Mount Goldsworthy Agreement”** means the agreement (as amended from time to time) approved by the *Iron Ore (Mount Goldsworthy) Agreement Act 1964*; **“Processing Agreement”** means the agreement (as amended from time to time) ratified by the *Iron Ore Processing (BHP Minerals) Agreement Act 1994*. (2) After the 1st day of April 1994, except for the production of iron ore in accordance with the approval of the Minister of the 5th day of March 1993 the Joint Venturers shall not produce iron ore under this Agreement unless there is an approved production limit under this Clause. (3) Where the there is an approved production limit under this Clause, the Joint Venturers shall not produce iron ore under this Agreement for transportation in any calendar year in excess of the approved production limit without the prior consent in principle of the Minister and, subject to that consent, approval of detailed proposals in regard thereto in accordance with this Clause. (4) If the Joint Venturers desire to establish or increase an approved production limit under this Clause they shall give notice thereof to the Minister and furnish to the Minister with that notice an outline of their proposals in respect thereto (including the matters mentioned in paragraphs (a) ‑ (m) of subclause (2) of Clause 7). (5) The Minister shall advise the Joint Venturers within two months of receipt by the Minister of a notice under subclause (4) of this Clause whether or not he consents in principle to the proposed limit or increase PROVIDED THAT the Minister shall consent in principle to the proposed limit or increase — (a) if the aggregate project cost under the Processing Agreement has been expended; or (b) if the aggregate project cost under the Processing Agreement has not been expended and: (i) the obligations of BHP under the Processing Agreement have been and are being properly performed and complied with; and (ii) the proposed limit or increase would not result in the approved production limit under this Clause exceeding 15,000,000 tonnes per annum or the combined limit exceeding 30,000,000 tonnes per annum. (6) If the aggregate project cost under the Processing Agreement has not been expended and: (i) the obligations of BHP under the Processing Agreement have been and are being properly performed and complied with; and (ii) the proposed limit or increase would result in the approved production limit under this Clause exceeding 15,000,000 tonnes per annum or the combined limit exceeding 30,000,000 tonnes per annum, the Minister may consent in principle to the whole or part of a proposed limit or increase or withhold his approval of the proposed limit or increase. The Minister shall give reasons for his decision if he withholds his approval, but his decision shall not be referable to arbitration under this Agreement or otherwise be the subject of challenge by the Joint Venturers. (7) (a) If the Minister consents in principle to a proposed limit or increase the Joint Venturers must within three months of that consent submit to the Minister detailed proposals in respect thereof otherwise that consent shall lapse. (b) The provisions of Clause 7 (other than subclauses (1) and (6)) and Clause 8 shall apply to detailed proposals submitted pursuant to this subclause with the proviso that the Joint Venturers may withdraw such proposals at any time before approval thereof or, where any decision of the Minister in respect thereof is referred to arbitration, within 3 months after the award, by notice to the Minister that they shall not be proceeding with the same. (c) If the Joint Venturers do not withdraw their proposals or give notice pursuant to paragraph (b) of this subclause then, subject to and in accordance with the *Environmental Protection Act 1986* and any approvals and licences required under that Act, the Joint Venturers shall implement proposals approved or deemed to be approved pursuant to this Clause in accordance with the terms thereof. (5) Clause 22 — (a) by deleting the subclause designations (1), (2), 2a), (3), (4), (5) and (6) and substituting respectively the subclause designations (2), (3), (4), (5), (6), (7) and (8); (b) by inserting as the first subclause the following — “ (1) The Joint Venturers may purchase their electricity requirements from generating facilities established under the agreement (as amended from time to time) ratified by the *Pilbara Energy Project Agreement Act 1994* and may transmit power to and within the areas of their mining operations or elsewhere subject to the provisions of the *Electricity Act 1945* and the approval and requirements of the State Energy Commission pursuant to any Act. ”; (c) in subclause (2), as renumbered by paragraph (a) of this clause, by deleting “For the purposes of facilitating integration of electricity generation and transmission facilities in the areas where the Joint Venturers carry on operations under this Agreement” and substituting the following — “ Subject to subclause (1), ”; (d) in subclause (3), as renumbered by paragraph (a) of this subclause, by deleting “subclause (1)” and substituting the following — “ subclause (2) ”; (e) in subclause (4), as renumbered by paragraph (a) of this subclause, by deleting “subclause (2)” and substituting the following — “ subclause (3) ”; (f) in subclause (6), as renumbered by paragraph (a) of this subclause, by deleting “subclause (3)” and substituting the following — “ subclause (5) ”. (6) By deleting Clauses 33, 34, 35, 36, 37 and 38. IN WITNESS WHEREOF this Agreement has been executed by or on behalf of the parties hereto the day and year first hereinbefore mentioned. | SIGNED by **THE HONOURABLE**<br>**RICHARD FAIRFAX COURT** in<br>the presence of — | ) ) ) | R F COURT | Colin Barnett MINISTER FOR RESOURCES DEVELOPMENT | THE COMMON SEAL of<br>**BHP IRON ORE (JIMBLEBAR)**<br>**PTY. LTD.** was hereunto<br>affixed by authority of<br>the Directors — | ) ) ) ) ) | C.S. | Director R J Carter Secretary Ada Lian Davies [Schedule 3 inserted: No. 29 of 1994 s. 10.]