barnett grants oakajee extension, page-5

Koko, more press today from The West Online:


UPDATE 1.05pm: Premier Colin Barnett says there will likely be changes to the ownership structure surrounding the Oakajee port and rail development after granting Murchison Metals and Japan?s Mitsubishi Corp an exclusivity extension until the end of the year.

Speaking to reporters this morning after confirming the extension ? as flagged by The West Australian ? Mr Barnett questioned Murchison?s ability to fund its share of the project cost on its own, saying ?there may be some changes to the ownership structure of Oakajee Port and Rail and I think that might be a good thing?.

?Oakajee Port and Rail has two partners: Mitsubishi (is) a world-scale company and no one questions their capacity,? he said.

?Murchison is a smaller Australian mining company which is looking to contribute its share of the infrastructure and also developing the Jack Hills mine, which is itself a very large project.

?So that stretches their capacity and I expect you might see some major balance sheet companies also increase their participation, either through Murchison or directly through OPR.

?(Murchison) will stay a major player in this project, I?m not suggesting anything other than that. But a project that?s going to run to perhaps $5 billion needs companies of the scale of the Mitsubishis of this world.?

Asked if he expected to see greater Chinese involvement in the project, Mr Barnett said it was a ?distinct possibility?.

?The Chinese companies are the buyers and I think you?ll see some Chinese investment in the project? it may not be great but just the involvement of a few major players, either directly or through Murchison, will add strength to the project,? he said.

?The Chinese are already there. They may also formally come into OPR in terms of the infrastructure.?

In a statement, Murchison said both it and Mitsubishi had confirmed their commitment to ?consider third party investment in the project in the future, should it be deemed appropriate to do so.?

Murchison executive chairman Paul Kopejtka said the extension would ensure ?optimum progress? was maintained on the project.

?Our teams? are working hard and with great confidence to complete the feasibility work so that project financing and construction can follow as soon as possible thereafter,? he said.

The bankable feasibility studies for both the infrastructure project and Jack Hills are targeted for the June quarter of 2011.

Meanwhile State Opposition Leader Eric Ripper called on the Premier to reveal details of the development agreement between the Government and the Oakajee proponents.

Mr Ripper said the Premier?s ?clumsy interventions into commercial issues were threatening the project?.

?Far from securing the project, Mr Barnett is putting it at risk,? he said.

Murchison shares jumped 7.5 cents, or 5.42 per cent, to $1.46 shortly before the close of trade.