agree, AGO would not be in a position to purchase assets nor do I think they want to. My take on it is AGO want access to the rail possibly to haul on a per ton basis. This in turn adds value to the sale price that FMG might achieve for the asset by having forward revenue locked in. Bit like selling the house with tenants locked in. Port capacity and whether additional development is required to utilise it is another discussion.
"By signing up Atlas as a customer for its rail and port assets, a potential 40 million tonnes of additional iron ore could be added to Fortescue’s existing rail, boosting the annuity and therefore the sale price higher. Atlas, in turn, could face costs of $3 billion to build its own railway and infrastructure, plus an additional $2 billion for a new export terminal at South West Creek. An option to use Fortescue’s rail line would be much cheaper"
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agree, AGO would not be in a position to purchase assets nor do...
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