get on the train

Midwest to get another breather on shift to rail
West Australian, page 61
Wednesday, 25 October 2006

Planning and Infrastructure Minister Alannah MacTiernan said yesterday she was likely to
allow iron ore miner Midwest Corporation to keep trucking iron ore on Mid-West roads
beyond her April deadline to allow the company to finalise its shift to rail.
Midwest yesterday said it had finally struck a deal with a Chinese rolling stock manufacturer
to supply 64 wagons to carry ore from its Koolanooka mine to the port at Geraldton.
While the wagons were scheduled for delivery in April, Midwest said it would take another
one to two months to complete commissioning and switch over ore shipments fully from road
to rail.
That would put the company in conflict with Ms MacTiernan's reluctant agreement in July to
allow Midwest to keep trucking until the middle of April to make the required shift on to rail.
The April deadline represented the second extension on the Minister's original order that
trucking of iron ore would be banned on the region's roads from October this year because
of serious local community concerns.
The order met strong resistance from Midwest, which said it threatened the viability of its
Koalanooka operation and could force it to miss contracted deliveries to its Chinese
customers.
Yesterday, Ms MacTiernan said she would grant Midwest another short extension to
commission its ore wagons provided it could demonstrate the contract was "cast iron".
"As long as there are no ifs or hues, then of course I would be reasonable," she said.
"Now that the contract is signed, we'll have a look at it."
Midwest chief executive Bryan Oliver said the contract with China South Locomotive &
Rolling Stock was "indicative of the company's commitment" to switch over from road to rail.
"We are pleased to conform to the State Government's preferred transport mode by moving
our operations to rail in mid-2007," he said.
Mr Oliver said Midwest had been able to implement a number of cost saving measures that
would ensure its rail operating costs were on a par with existing trucking costs.
The Chinese Supplier has already provided almost identical wagons to fellow Mid-West
miner Mount Gibson Iron this year, and will also supply wagons to Andrew Forrest's
Forteseue Metals Group in the Pilbara.
Based on the price of previous contracts, the deal is believed to worth less than $10 million.
Midwest is also understood to be in the final stages of negotiations with rail operator ARG
over the terms of access to the Geraldton railway.
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