An upbeat article on the financial possibilities of WA magnetite mines.
CITIC’s giant Sino Iron mine books $1.33bn profit amid magnetite revival
Nick Evans The Australian
CITIC’s giant Sino Iron magnetite mine in the Pilbara is at last repaying the faith of its owners, more than doubling its profit to $US948m ($1.33bn) last year, on the back of strong iron ore prices and ongoing cost-cutting at the energy intensive project.
The result came as Sino Iron nudges towards its 24 million tonnes a year nameplate capacity, with output hitting a record 21 million tonnes of magnetite concentrate through the year according to annual results filed to the Hong Kong exchange by CITIC.
Even though the profit came on the back of the strongest iron ore prices in a decade the result, up 121 per cent from the mine’s $US429.6m net profit in 2020, underscores the potential for the long-term investment case for the development of magnetite operations in Western Australia.
While the accounts filed with the Australian Securities and Investments Commission by CITIC last week do not give a detailed breakdown of the mine’s operations, the company said it received about $US3.28bn from the sale of iron ore concentrate through the year – implying an average price of about $US156 a tonne, up from around $US111 a tonne in 2020.
Total production and sales costs of $2.09bn for the year, implying an average cost of production of about $US99 a tonne. That is up from about $US81 a tonne in 2021, although the figure likely includes royalties paid to the state government and landlord Clive Palmer, which both rise along with the received price.
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