Fortescue sets sail across the ditch
Interesting Article especially the last couple of paragraphs:-
FMG has shipped more than 4 million tonnes of iron ore since May, giving it about $US310 million ($325 million) in revenue.
FMG believes they can pay back depth once production reaches 30MT (May-June next year maybe???)
FORTESCUE METALS - the self-proclaimed "new force in iron ore" - is seeking to conquer new territory: New Zealand.
The Pilbara iron ore miner has lodged several applications for exploration ground on the west coast of the South Island after registering a New Zealand subsidiary, FMG Pacific.
According to the New Zealand Government's Crown Minerals Department, the proposed exploration permits cover more than 24,000 square kilometres - about 16 per cent of the South Island's total area.
Fortescue is looking to test the ground for iron sands, which are already dredged along the coastline of the North Island by operators including BlueScope Steel.
BlueScope processes 1.2 million tonnes of iron sands from its Waikato North Head mine into 600,000 tonnes of raw steel a year, and also exports sands from its Taharoa mine to customers in northern Asia.
It is thought Fortescue decided to peg the New Zealand ground - its first foray outside Western Australia - when one of its geologists identified it as a prospective region.
J. Michael Palin, a geology lecturer at the University of Otago, told the Herald iron sands were present on the western coastline of both islands in New Zealand. But he said the South Island deposits had not been exploited to the same degree due to a lack of infrastructure and a rougher coastline.
The deposits were nowhere near as prospective as those in the Pilbara for large-scale mining operations, but the iron sands product was relatively cheap to mine and could be exported to niche steel producers.
"You're not looking at big, bulk markets," Dr Palin said. "What you are looking at are specific, lower-tonnage applications."
Iluka Resources mines iron oxide at its Australian mineral sands operations and at one stage considered building a $250 million pig iron plant to commercialise its iron oxide waste, but abandoned the plan in 2006.
In its June quarter report yesterday, Fortescue said it planned to undertake limited testing for iron sands if it was granted the 4000 square kilometres of exploration ground it requested during the quarter. It lodged applications covering another 20,000 square kilometres in the present quarter.
But Fortescue warned the process of obtaining the leases was likely to be "long and widely consultative".
The Otago Daily Times has reported opposition from small-scale alluvial goldminers in the region. Fortescue's application covers all minerals from aluminium to zinc.
Meanwhile, Fortescue is continuing to raise production at its Pilbara operations. The company has shipped more than 4 million tonnes of iron ore since May, giving it about $US310 million ($325 million) in revenue.
It plans to ship 22 million tonnes of iron ore this year and said it was looking to secure vessels to ship the ore to China to better manage its shipping schedule and receive a margin on the freight component of the sales price.
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Fortescue sets sail across the ditchInteresting Article...
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