Sun Metals Zinc Refinery, located near the City of Townsville in North Queensland, Australia, is an outstanding example of a major value-adding, export-oriented product that has brought ignificant economic and employment benefits to the region and the nation. The refinery was built by Sun Metals Corporation Pty Ltd, the Australian subsidiary of Korea Zinc Company Limited which produces 10 per cent of the world's zinc from plants in Korea, the USA and Australia. The project, which cost around US$425 million to build, represents the largest single investment in Australia by a Korean company. The fact that it was completed on schedule and to budget is indicative of meticulous pre-planning and the excellent working relationships that developed between the company, its suppliers and contractors. The refinery consumes more than 400,000 tonnes of zinc concentrates each year, sourced from North West Queensland and other zinc mining areas in Australia and overseas. These oncentrates are converted into approximately 200,000 tonnes of value-added zinc metal, mainly for export, which is considerably higher than the plant’s nominal production capacity of 170,000 tonnes of zinc. An important by-product is more than 360,000 tonnes of sulphuric acid which is mainly used in Queensland to produce high quality agricultural fertilisers. Despite current low world zinc prices, the refinery generates more than $330 million in annual sales of which approximately 80 per cent is export income. In the context of these low metal prices, the ability of the refinery and its operators to efficiently produce above the plant’s nominated design capacity is an important factor in maintaining cash costs at the lowest possible level. This also provides a solid foundation for the future when prices inevitably improve. Sun Metals Zinc Refinery directly employs more than 300 staff. Significantly, about 20 per cent of the employees are trainees undertaking certificate courses which have opened up new career opportunities for young people in the region. In addition to those employed directly, more than 1,500 additional jobs have been created in Queensland to service the refinery in areas ranging from road, rail and sea transport and handling to the mining and processing of concentrates, technical support and the supply of other goods and services. Another major benefit is that the facility, in conjunction with nickel and copper refineries already established in the area, has contributed to Townsville becoming what is arguably Australia’s premier centre for non-ferrous metals processing. Furthermore, establishment of the Sun Metals refinery is seen as a catalyst for additional projects in the area such as power generation and downstream metal product industries. The refinery’s success illustrates the vision and leadership of Korea Zinc, all levels of Government, the project’s financiers and the region’s business leaders. It also testifies to the commitment of staff members and the widespread, pro-active support received from all sectors of the community.   A ground-breaking ceremony held near Townsville on 30 July, 1997, signalled the commencement of construction for the first stage of the Sun Metals Zinc Refinery. However, this milestone event was preceded by several years of planning and intensive negotiations between Korea Zinc and many other parties, most notably the Queensland Government, to secure the infrastructure and other support necessary to ensure the project’s success. The decision to build the refinery near Townsville followed a concerted approach that involved all sections of the community. Townsville City Council and the region’s peak marketing and development body, Townsville Enterprise, were first approached informally in early 1994. The project at that stage was broadly conceptual. Later that same year, Townsville was given an opportunity to present its credentials to Korea Zinc. There was wide-ranging input from all sections of the community and the submission bore the hallmarks of a region that was genuinely interested in the project and committed to having it built. This widespread, pro-active community support was an important factor in the choice of Townsville as the site. Other major considerations included established rail links to the North West Queensland Minerals Province, access to major export markets through a well-developed port, a skilled workforce, competitively priced energy and suitable land at Stuart, just south of Townsville. Challenges To Progress Korea Zinc and Sun Metals were faced with a number of problems and obstacles during the refinery’s construction. Only a few months into the project, the Asian ‘meltdown’ led to a major economic crisis in South Korea. Domestic interest rates more than doubled, the nation’s currency depreciated dramatically and the overall level of economic activity was significantly reduced. Fortunately, the banks and other institutions which helped finance the project stood firm and honoured their original commitments, allowing construction to progress without delay. Other setbacks included record rainfall in January, 1998, and labour disputes in March, 1999, which interrupted construction for 23 days resulting in a major impact on the budget and construction schedule. Despite these obstacles, Korea Zinc and the company’s contractors were able to complete the refinery on schedule and within budget. Production at the plant, which is acknowledged as the world’s most advanced zinc refinery, began in November, 1999, and the facility was officially opened by Prime Minister John Howard and Queensland Premier Peter Beattie on 16 May, 2000.   Future Relationships Australia is already one of Korea’s largest trading partners and the relationship between the two countries, both culturally and commercially, continues to grow and flourish. The strengths of Australia and Korea are complementary and the success of the Townsville refinery could well provide the catalyst for future partnerships that will benefit both nations. The successful construction and commissioning of the Sun Metals Zinc Refinery has been largely due to the strong spirit of understanding and co-operation that has developed between Korean and Australian management and staff. This multi-cultural aspect of the refinery provides an object lesson for the future conduct of business and industrial partnerships between Australia and its Asian neighbours.