In February 2026, the Australian government announced what headlines described as a record-breaking $55 million fine against Alcoa for illegally clearing 2,100 hectares of the Northern Jarrah Forest. It sounded like accountability.

Read the fine print — or rather, the industry press — and the same event looked entirely different. Mining Magazine described it as Alcoa “locking in the future” of its Western Australian bauxite operations. The Biodiversity Council noted that $55 million represents less than 0.5 per cent of Alcoa’s 2025 revenue, and almost certainly less than what the company would have spent on approvals and offsets had it sought permission in the first place. The noise of the fine was designed to mask the silence of what came next: an eighteen-month “national interest exemption”  allowing Alcoa to keep clearing the forest while a strategic assessment is conducted — during which it can clear a further 1,200 hectares. Nearly 60 per cent of the hectares it was just “penalised” for.

The politico-financial mechanism enabling this is worth naming clearly. The gallium project — a plan to extract gallium as a by-product of bauxite refining at Alcoa’s Wagerup facility — receives US government investment made under Title III of the US Defense Production Act (DPA). This is the provision that allows Washington to fund foreign sources of materials deemed critical to defence production, effectively treating Australia as a domestic supplier for Pentagon procurement purposes. The DPA Title III doesn’t override Australian law. It doesn’t need to. It simply makes the strategic stakes high enough for Australian governments to do the overriding themselves — through the State Development Act 2025, through EPBC reforms, through national interest exemptions that convert environmental crimes into strategic mandates. This is AUKUS Pillar III in practice: not a legal instrument that binds Australia, but a financial and political logic that Australian governments have chosen to internalise.

The community knew something was wrong long before the lawyers did. A record 59000 public submissions were lodged with the EPA opposing Alcoa’s mining expansion. The Northern Jarrah Forest is not an abstraction: it is the catchment for Perth’s dams. In a city where dam inflows have collapsed from an average of 420 gigalitres before 1974 to just 75 gigalitres today — a decline of more than 80 per cent — the forest is not scenery. It is national infrastructure.

Internal Water Corporation documents reveal that CEO Pat Donovan warned his board in May 2024 that contamination of the pipehead dam would affect 1000 customers within two hours, 10000 within six hours, and “well over 100000 customers beyond six hours.” More significantly, Donovan told the board that Water Corporation had formally requested to be removed from any decision-making role in assessing Alcoa’s mining proposals — not because the risk was manageable, but to protect the organisation’s reputation. “Water Corporation does not have a regulatory function”, Donovan wrote, “but does carry the reputational risk of being party to approving mining activity which ultimately impacts its operations”. The state’s own water utility refused to be associated with the approvals process, because it could not defend what was being approved. While Water Corporation considers the contamination of Serpentine Dam a “certainty”, an analysis commissioned by Alcoa itself found its expansion plans pose a “high risk” to the drinking water supply of 2.3 million people. The state government granted the exemption anyway.

In February 2026, Greens MLC Jess Beckerling alleged that conditions attached to the exemption — including a prohibition on clearing within ten metres of significant trees — were being breached. She found out by trespassing. Not through a formal inspection, not through government monitoring, but because an elected representative felt compelled to enter the forest herself to see what the regulator was not looking for. Premier Roger Cook declined to comment while investigations were ongoing but made the government’s priorities clear: “They pay royalties, they bring prosperity … any decision to curtail those operations is a very significant one”. Alcoa denied the allegations. The clearing continued.

After six decades of strip-mining, not a single hectare of Alcoa’s mined land has been formally certified as rehabilitated by the WA government. The bauxite substrate — the foundation of the forest’s ancient hydrological and nutrient systems — once removed, is irreplaceable. What Alcoa and the government call rehabilitation is, in the scientific literature, a thin biological veneer over a permanent sacrifice zone.

This is AUKUS Pillar III made material. There are two other pillars.

What gallium is actually for

Gallium is a trace metal recovered as a by-product of aluminium refining. In its compound forms — gallium nitride and gallium arsenide — it is foundational to modern defence electronics: the AESA radars in F-35 fighter jets, missile guidance systems, 5G infrastructure. China currently controls approximately 98 per cent of global primary gallium production, and exploited that dominance in 2023 with export restrictions that sent prices surging. Breaking that chokehold is a legitimate strategic concern. What is less legitimate is the mechanism chosen to address it.

The gallium extracted at Wagerup will flow into the AUKUS Pillar I industrial base — including the nuclear-powered submarine program anchored to a new base on Garden Island, south of Perth. That base will also require an operational waste storage facility for low-level nuclear waste from rotating US and UK submarines — opening, critics warn, a legislative door to Australia eventually becoming a repository for allied nuclear waste more broadly. Senator David Shoebridge has warned that the law as written allows a minister to “pick any place on a map, then the next day make a nuclear waste dump there — almost overnight”. No costing has been published. The Australian Submarine Agency, when asked under Freedom of Information laws for its latest cost estimates, could not produce them.

The US Navy is currently producing Virginia-class submarines at a rate of roughly 1.2 per year — far below its own target of two per year — with a chronic maintenance backlog leaving a third of its fleet in port. Pentagon adviser Elbridge Colby has confirmed as much publicly: submarines are a “scarce, critical commodity” and US industry cannot produce enough to meet American demand. The forest is being cleared now, for hardware that strategic analysts across the political spectrum say is unlikely to materialise on the promised timeline — if at all.

Even the security calculus may invert reality. As Professor Hugh White has argued, Australia’s hosting of US military assets — from Pine Gap to submarine bases — ignores the transactional nature of US alliances, and could draw Canberra into armed conflicts Washington is not itself willing to fight. Professor Mark Beeson and Dr Emma Shortis have warned that by becoming a “domestic source” for the US military-industrial complex, Australia may be painting a target on its back without gaining genuine protection in return.

And the costs are not speculative. The Australian government’s own estimate puts the total cost of the submarine program at between $268 billion and $368 billion over its lifetime. In the first decade alone, $50–58 billion will be spent for zero in-service submarine capability — money stripped from other defence priorities, and unavailable for hospitals, schools, housing, or the water infrastructure Perth demonstrably needs.

This is the strategic calculus being used to override 59000 public submissions, the findings of the EPA, the warnings of Water Corporation, and the assessments of security experts. It is a deal that Australian prime ministers as different as Turnbull and Keating have respectively called a “terrible deal” and “the worst deal in all history.” And yet Pillar I’s financial cost, staggering as it is, may not be the most insidious form of extraction. The forest goes to Pillar III. The energy and the water go to Pillar II.

The information and energy arms race

AUKUS Pillar II covers advanced technology — AI, quantum, cyber, autonomous systems. To understand what that means in practice, it helps to understand what AI has become in the strategic competition between the United States and China. The 2026 Stanford HAI AI Index — the most comprehensive global dataset on AI development, cited by governments and major institutions worldwide — finds that the US and China have been trading the lead in frontier AI capability since early 2025, with the performance gap now measured in fractions of a percentage point. AI sovereignty, the report finds, has become a defining element of national competition, with state-backed supercomputing investment rising in every region.

This is the arms race that AUKUS Pillar II formally commits Australia to joining. Its six technology domains — AI and autonomy, quantum, advanced cyber, hypersonics, electronic warfare, and undersea systems — are explicitly designed to integrate autonomous weapons systems across the AUKUS alliance, with shared infrastructure and AI trained on common data. The data centres arriving in Perth’s eastern corridor are the physical infrastructure of that commitment. CDC Data Centres, developer of the 200-megawatt Maddington campus — the largest data centre planned for WA, representing around 10 per cent of the SWIS’s current underlying electricity demand — has explicitly marketed the facility as AUKUS-ready. These facilities are not incidental to the alliance infrastructure being built around Perth. They are part of it.

Which brings us to energy.

In testimony before the US Senate in May 2025, OpenAI CEO Sam Altman was direct about the ultimate constraint on AI:

Eventually, chips, network gear … will be made by robots, and we’ll make that very efficient and cheaper and cheaper. But an electron is an electron. Eventually the cost of intelligence, the cost of AI, will converge to the cost of energy.

A US senator on the same committee drew the strategic implication plainly:

The ability for the US to deploy new energy generation capacity and upgrade its grid is in many ways the key to the race against China.

The AI arms race is inherently an energy arms race. And Australia is being conscripted into both. Aside from buying into the arms race logic or not, the question worth asking is: who will bear the cost?

On 30 March 2026, the Mineral Policy Institute and Murdoch University submitted a formal objection to a proposed data centre at Hazelmere — the first time a mining policy organisation has objected to a data centre on mining governance grounds. The reason is structural: data centres extract shared public resources — energy, water, land — to generate wealth that flows to distant shareholders while concentrating costs on local communities. This is the structural logic of extractivism, applied to the digital economy.

The Hazelmere proposal sits within the Helena River catchment that Noongar Traditional Owners are working to restore through the BoorYul-Bah-Bilya integrated management plan — the first of its kind to integrate environmental, social, cultural and economic values for a single river system. It sits adjacent to Trillion Trees Australia, a community nursery that has planted over 15 million native trees since 1979.

Perth is already one of the world’s most water-stressed capitals. Data centres are arriving with poorly disclosed and likely underestimated water demands, because global providers routinely apply cooling standards designed for temperate climates to a city where summers regularly exceed 35°C. WA has no regulatory framework to measure or limit data centre water consumption. What it does have is a 2022 state government marketing document actively promoting Western Australia’s “water availability” to attract data centre investment. The pattern is identical to mining: attract the investment first, govern it later — if at all. The AI arms race is an energy arms race. And in Perth, the energy arms race is also a water arms race — competing for the same depleted catchments, the same overstretched grid, the same city that was already running out before any of this arrived.

The connection between the Jarrah Forest, the submarine base, and the data centres is not metaphorical. It is the three pillars of AUKUS, made material in a single city. Pillar III strips the forest to supply aluminium and gallium to the other two pillars, gutting the environmental and water security of 2.3 million people. Pillar I builds a base for what the US Navy explicitly describes as “warfighting lethality” — and seeds the local ground with nuclear waste no one has costed or sited. Pillar II fills the eastern corridor with data centres that their own developers describe as essential to the alliance, competing for the energy and water a city already cannot afford to spare. Environmental security, water security, energy security, and military security: each is being traded away in the name of the last one. And the last one, as the strategic record makes clear, is far from assured.

Each pillar accelerates an arms race that is itself a driver of the crisis we should actually be addressing. Climate change — the one threat that is neither speculative nor manufactured — will be made worse by every tonne of bauxite cleared, every nuclear reactor stationed in our waters, every megawatt of server heat dispersed into a warming city. The forest, the water, the energy: these are not obstacles to security. They are what security actually means.

After six decades of strip-mining, not a single hectare of Alcoa’s mined land has been formally certified as rehabilitated. The $55 million fine bought public silence at a discount. The national interest exemption converted an environmental crime into a strategic mandate. DPA Title III reclassified a sovereign nation as a domestic supply depot for the US. And beneath all of it — beneath the gallium and the submarines and the server halls — the Jarrah Forest keeps being cleared, the catchments keep degrading, and 2.3 million people keep getting closer to a water crisis that was both foreseeable and preventable.

The bauxite substrate, once removed, is irreplaceable. What grows back is not the forest — it is the appearance of one. The national interest invoked to justify it works the same way. Strip the substrate, plant the veneer, call it recovery.

Post script 

Since this article was written, the Hazelmere data centre proposal has been withdrawn. The City of Swan received nearly 1,900 public submissions and the council voted 11–2 against it. Community organisations including Bibbul Ngarma Aboriginal Association, the Mineral Policy Institute, Trillion Trees and local residents all raised formal objections. For the full story of how collective voices won this outcome, see the Mineral Policy Institute’s Mining Monitor: Good News: Community Voices Win on Mandoon Bilya.