As I mentioned, there’s quite a bit to digest in this Investor...

As I mentioned, there’s quite a bit to digest in this Investor Call, but here are a few points worth highlighting to begin with that stood out for me.

Iron Bridge

Fortescue received a second shipment during the quarter, and there have been three further shipments this month (January 2024). Yes, you read right, three additional shipments this month!

Raw Water Pipeline leaks were detected during Q2, which impacted production, however they're advanced with looking at options to de-risk and improve the performance of the high pressure sections where the leaks occured. The 65 km section will either be repaired or replaced. Installation should take less than 18 months, and they anticipate that it will not affect ramp up. Investment approx US$100m. As a result of the above pipeline issue, guidance has changed short term to 2mt-4mt, but is still operational. Also the revision to the opex guidance for Iron Bridge of US$200 million to US$400 million for FY24 is as a result of mining activity and expenditure being optimised for compliant availability. Make sure to read the Q&A section.

What was also highlighted is that there is huge customer interest in the product. They are absolutely focused on the safe and efficient ramp up to name plate capacity.

Green Energy

The United Kingdom is now is their second largest base outside of the Pilbara, with more than 1,000 Fortescue employees.

Decarbonisation progress last quarter was extraordinary.

The company announced three of the world's first green hydrogen and green steel projects to FID.

Re Phoenix Project, they’re working on some offtakes to have these locked in. They’re continuing studies (engineering) which they hope to have completed over this year and to make sure they fit within the IRA’s requirements.

The next cab off the rank they highlighted would probably be Norway, followed by Brazil and Kenya. Guidance will only be announced as they come to FID. What I really think is very important here is the financial discipline that they have going forward. These prospective projects have to have the right criteria.

As for the Gibson Island project, the company is working hard to get this over the line. Cost of power is key and a very important issue at this point in time. The Board will come together later on in February to decide whether it’s a go or no-go decision. If the project gets a tick, there will be support from both Federal and State Governments.

The company have estimated that they will need around two to three gigawatts of renewable energy and battery storage to decarbonise their iron ore operations in the Pilbara. They have now constructed 320 kilometres of transmission lines to connect Solomon to Iron Bridge, all the way through to Port Hedland, which means that they can run the sites on renewable energy as they continue to build it out.

They are on track to commission a 100 megawatt solar farm near the Iron Bridge operation by mid year.

They deployed Australia's first operational electric excavator at the Cloudbreak operations, which will allow the company to remove 95 million litres of diesel a year at the site.

Fortescue/Liebherr converted a R 9400 excavator from a diesel engine to an electric powertrain which has been commissioned at their Christmas Creek mine site.

BUT this section below is what really has my attention and has had it for a while.

The company’s technology development is a major focus as it underpins their decarbonisation plans, but it also presents a real growth opportunity from a commercial perspective which has been highlighted previously.

As highlighted by FE’s CEO, the digital software business called “Fortescue Battery Intelligence” is selling highly sought after technology. Check this out: World-leadingbattery intelligence software from WAE Technologies, designed for massautomotive, e-mobility and stationary energy storage companies.

https://www.elysia.co/our-story

Have a read of what they had to say regarding “Fortescue's Booster Charger” in the Investor Call!

Their products are in demand all over the world. They’re expanding their capabilities to build these products themselves. That’s why they’re going to soon open the Banbury manufacturing facility in the UK together with their Advanced Manufacturing Centre in the United States in Michigan.

Fortescue Energy have a strong pipeline of projects to come online in 2024.

· Trialing green haul trucks

· Green trains on at their sites

· Testing the green ammonia / dual-fuel ship and

· Automating the production line of electrolysers in Gladstone.

Tony