I'm still challenged working out AGO's rail haulage options. This presentation has thrown their port entitlements back into the spotlight. Note on p11 "leverage off port capacity allocations to access other infrastructure options". A few of my observations/opinions are; - open access deals with FMG and BHP are off the table (noting that AGO has not been buying into these discussions) - a haulage deal with FMG could potentially give FMG indirect control over the majority of available third party capacity at Port Hedland which won't sit well with the State Government or other producers - the slides indicate that AGO will have to make a significant capital investment for a conveying system from FMG's rail along with the development of the South West Creek port - AGO could end up with a BCI-type deal with FMG - Hancock's rail/port is more favourably located to AGO's port entitlements and could offer better expansion synergies for both parties (both will be constrained for additional inner harbour capacity) A deal with Hancock seems more logical at this stage. BCI must be a very interested observer as am I.
AGO Price at posting:
88.5¢ Sentiment: None Disclosure: Not Held
