Ann: Infrastructure for Long Term Production - Desk Top Study, page-17

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The Port of Esperance has always offered a desirable solution for GWR to exploit its iron ore resource, however access to the port and associated infrastructure has been effectively closed to the junior and mid-tier miners,” GWR said on Monday.

GWR said it would weigh up options for carting iron ore to Esperance, including building a rail line or private multi-user haul road to the town of Leonora and an upgrade of the existing rail line between Leonora and Kalgoorlie, which continues through to Esperance.

The iron ore newcomer made two shipments from Geraldton in June at an average realised price of $US214 a tonne and said it was on target to reach the million tonne milestone by December.

One of the big attractions of Esperance is that it can handle capesize vessels with 150,000-tonne capacity whereas at Geraldton it is limited to vessels with 60,000-tonne capacity.

GWR chairman Gary Lyons recently became the founding chairman of the WA Midwest Yilgarn Infrastructure Group, whose other members include Mindax Ltd, Macarthur Minerals. Jupiter Mines and Tungsten Mining. The group lists ensuring fair access to infrastructure, including ports, as one of its key objectives.

The WA government waved royalty payments and offered cut-price port fees at Esperance in 2018 in supporting Mineral Resources’ acquisition of Cleveland-Cliffs’ Koolyanobbing iron ore operations.

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Cleveland-Cliffs had been set to close the mine as it exited Australia, but it has since become a big money spinner for Mineral Resources.

The deal also saw Mineral Resources take control of Cliffs’ fixed infrastructure assets at the port.

The WA government was forced to defend the deal in the countdown to the March state election after revelations Mineral Resources had received about $220 million in royalty rebates under the terms of the deal.

Mineral Resources is deep in negotiations with the WA government about the right to develop two berths at South-West Creek within Port Hedland.

Fortescue and Roy Hill export from South-West Creek and in April Fortescue chief executive Elizabeth Gaines said the incumbents must not be inconvenienced if vessel movements there were to increase.

Brad Thompson writes across business and politics from Western Australia for The Australian Financial Review. Brad is based in our Perth bureau. Connect with Brad on Twitter. Email Brad at bradthompson@copyright link