At the right price premium, the Chinese would like to import concentrated magnetite, because it can be converted to steel using less energy and emitting less pollution. There is a good 16/04/14 dated post on this in the GBG thread.
The problem is to concentrate magnetite needs power, which in the final analysis in the WA Mid-West means natural gas to generate the electricity that can be transmitted to the mine-site concentration facilities. As GBG's woes have suggested, getting a concentration plant operational is itself not trivial, although other miners may learn a thing or two from GBG's experience. Then, ideally, there must be a rail connection to a deep-water port, which is the nub of what has been written about in this PDY thread. There is an interesting 11/04/14 dated post on the GBG thread that suggests there are some issues with the proposed railway path mooted (flooding) and the site of the proposed deep-water port at Oakajee (heavy swells). Overcoming these is not impossible, it just hogs more billions.
Pulling this Oakajee thing together is going to take time, a high level of coordinating skill and billions of dollars. Not something in which Gazza and his tonsorial apothecary chum are going to play a successful role in effecting, in my opinion. It's too big.
My interest in GBG is a corollary of the fact that BYL, which I hold, has an earthmoving contract with GBG's associated company Karara Mines Limited, and any railway construction that may eventuate would be an opportunity for BYL, and NWH which I also hold. NWH has secured two large earthmoving contracts from Roy Hill, thanks to mine development and railway construction required to get the Roy Hill project up and running. Would that the Oakajee adventure gains traction in coming years.
PDY Price at posting:
3.3¢ Sentiment: None Disclosure: Not Held
