Major project pipeline pumped for growth

The value of Queensland’s major construction and engineering future project pipeline has grown by almost 25 per cent in the last 12 months, reaching $62 billion across the next five years, a new report shows. The Queensland Major Projects Pipeline report, released by Queensland Major Contractors Association, evaluates the current market outlook and medium-term major project construction pipeline across the state. QMCA chief executive officer Andrew Chapman outlined a positive outlook for the state, with significant growth in rail and road transport and energy. The report also identified a significant improvement in project funding, with funded projects accounting for $35.5 billion of the total pipeline. “136 major projects are funded, which is fantastic news for the industry and for Queenslanders who will directly benefit from significant investment in construction and engineering, through supply chain and employment opportunities as well as the through access to economically beneficial assets delivered in the coming years,” Mr Chapman said “Funded works currently peak in 2022/23 – but could surge higher in 2023/24 – reaching $17 billion in construction work undertaken in 2023/24 alone, if all projects proceed. "This would be the highest level of infrastructure investment in Queensland since the peak of the resources boom.” Check out what's in store for your region here: Greater Brisbane – $6.8bSunshine Coast – $1.2bGold Coast – $2.5bWide Bay – $1bFitzroy – $2.3bToowoomba-Ipswich-Logan – $5.4bMackay-Isaac-Whitsunday – $3.1bTownsville – $1.3bCairns $1bOutback, North, South, FNQ, Mt Isa, Cloncurry and Weipa – $3.2bMulti-Region – $1.4b The report outlines several opportunities to enhance the pipeline, increase funding options and create an infrastructure legacy for the state. “The SEQ Olympics represents a once in a generation opportunity for infrastructure investment, and we predict an uplift in the pipeline from 2024 onwards as the Olympic infrastructure and legacy infrastructure starts to be delivered," Mr Chapman said. The transition to zero net emissions is also an opportunity for the state’s construction and infrastructure sector. “Renewable energy generation and storage, as well as new energy exports such as hydrogen, will have a significant role to play in the sector moving forward," Mr Chapman said. "We will need new and upgraded transmission lines, roads, rail infrastructure, ports, pipelines and more to support the state’s aim to be a global leader in renewables and clean energy. "In addition, investment in transmission networks and energy generation through solar, wind and pumped hydro should all become stronger elements of the project pipeline in the years ahead.” Funded major project work: Strongest growth is in roads and non-water utilities sectors.Road work has risen from $7b in April 2020 to $11.5b.Non-water utilities projects have risen 95 per cent from $2.3b to $5.5b on the back of renewable energy projects and NBN ongoing investment.Mining and heavy industry activity rose from $4b to $5.4b.Activity in railways, harbours and Defence is slightly lower than in April 2020.Almost half of all funded activity – and two-thirds of funded transport activity – occurs within the South East Queensland (SEQ) region.Brisbane and the broader SEQ region remain critical for funded major project activity even though its share of activity is lower than in 2020.Outside of the SEQ region there are still substantial risks to the pipeline given the higher share of unfunded work: many of the major projects in regional Queensland are resources and nergy based where global market factors still heavily influence short- to medium-term investment decisions. Raft of challenges could hamper delivery The report also identifies the potential barriers to delivering the state’s $62 billion project pipeline, including resources and skills, productivity, sustainability, global demand and project approvals. “Global markets dictate much of the resources investment, and their volatility could impact on projects in the sector," Mr Chapman said. "Construction materials supply and costs are increasing dramatically, and this is unlikely to ease for another 18 months as global demand outstrips supply. Related: Project splurge creates skills and supplies crunch “The sector’s productivity is at the same level as it was at the turn of the century. Therefore we need to adapt and innovate across every aspect of project delivery. QMCA chief executive officer Andrew Chapman. "New technologies, artificial intelligence and machine learning can deliver significant productivity gains, and we must be open to new methodologies and ways of working to improve performance. “From a project approval perspective, it still takes too long to scope projects, complete business cases, gain approvals and funding and have them ready for the market to deliver. With the SEQ Olympics just over a decade away, reform is required to ensure that we can deliver the infrastructure required to hold the best games ever.” Access to labour is one of the key areas of concern identified in the report. “Queensland’s pipeline is strong, but there are challenges that could impact on the state’s ability to deliver projects," Mr Chapman said. "We are competing with the southern states for resources, both New South Wales and Victoria have significant project pipelines, close to double that of Queensland’s. "This is a challenge from a labour force perspective, and when coupled with the fact that Queensland is lagging in apprenticeships and trainee numbers, a labour shortage is a real possibility.”

Major project pipeline pumped for growth

Industry Queensland

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