QR, Atlas join forces to open Pilbara rail access Peter Ker April 26, 2012
Read later.THE long-held dream for an open-access railway in the Pilbara is a step closer, with QR National and Atlas Iron believed to be working together on a feasibility study for a landmark piece of infrastructure.
Confirmation of the partnership is expected in the coming days, in a development that could affect landlocked miners in the Pilbara region.
Infrastructure, and particularly the access to ports, is a valuable commodity in the Pilbara, which ranks as the world's most important iron ore province.
Advertisement: Story continues below BHP Billiton, Rio Tinto and Fortescue Metals, the companies with their own railways to Pilbara ports, have jealously guarded access to their infrastructure, with only Fortescue offering limited access at a very high price.
Gina Rinehart's Hancock Prospecting is also building its own railway to connect its Roy Hill mine to Port Hedland.
Atlas and QR National are expected to spend the rest of the year working on the feasibility study, which has an initial aim of being able to carry iron ore to the port by 2015.
QR National has pegged a possible route between south-east Pilbara and Port Hedland, and is shaping as the senior partner in any joint venture with Atlas.
Atlas has rapidly increased its iron ore holdings over the past year, thanks to the acquisition of small companies such as FerrAus and Giralia Resources.
The company trucks iron ore to Port Hedland from its tenements, but will need a railway if it is to develop its assets in the south-east Pilbara.
The development of those assets could result in Atlas lifting its production from about 6 million tonnes a year to about 40 million tonnes.
Its management is expected to be questioned on the issue when it
discusses the March quarter production figures tomorrow.
A price tag of between $3 billion to $4 billion has been suggested for a multi-user rail project.
Brockman Resources and Flinders Mines are other smaller iron ore companies that could benefit from a multi-user infrastructure project in the Pilbara.
Fortescue spent years fighting BHP for railway access, in a battle that is still going through the courts.
Fortescue gave BC Iron permission to use its railway, but forced it to hand over 50 per cent of its Nullagine project in return for the access.
