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JUNIOR explorer Jupiter Mines is planning to consolidate iron ore assets in Western Australia's Yilgarn region, with major investor Brian Gilbertson enlisting the support of South Korea's leading steelmaker, Posco.

Posco this week received shareholder approval for a 13 per cent stake in the junior, with its Australian managing director, Sun Moon Woo, saying the company was keen to get in at the grassroots level to secure a strategic foothold on steelmaking materials.

Mr Woo, who was also appointed to Jupiter's board, said taking an interest at a junior level was a new strategy for the steel giant as it was becoming very expensive to do deals with the majors.

"We are looking for some initial stage exploration ... we try to invest in a smaller company such as Jupiter to develop iron ore and manganese for our steelmaking business," he said.

Mr Woo added that Posco was also still reviewing other opportunities in Australian iron ore, which remained top of the list for Asian steel mills.

"At this stage we are also considering participation in operating companies in Australia," he said.

Mr Woo said he was concerned China had been leading the foreign interest in Australia's resources.

"We are worried about that. They are so aggressive and intensive in their investment in Australia, and we have to compete with that," he said.

BHP Billiton and Rio Tinto's proposed Pilbara iron ore merger was also a concern.

"It is not desirable. Even if they have production integration they are still a power in supplying the market and we are worried about the situation," he said.

Mr Gilbertson, a former BHP Billiton boss, is the driving force behind the push to focus on manganese and iron ore assets and believes his investment vehicle Pallinghurst's interests sit well with Jupiter's strategy.

"Pallinghurst is very enthusiastic about steelmaking materials. We really do believe over the next decade this is going to be the field of intense competition," Mr Gilbertson said.

"My investors, who are international investors, are very enthusiastic about this concept and will back with substantial funding any reasonable proposal the Jupiter team can come up with."

Pallinghurst also has a 50 per cent interest in a manganese project in South Africa, which Mr Gilbertson said could further boost Jupiter's manganese interests in Australia.

"If both of these projects are developed to the full potential we hope, it offers additional opportunities blending different types of ore and meeting the needs of the customer, in a more efficient way, then it would if they were trying to upgrade separately," he said.

Jupiter chairman Geoff Wedlock, a former BHP iron ore executive, said the junior, driven by Pallinghurst and Posco, would be a vehicle for undertaking iron ore and manganese developments.

Mr Wedlock, who was responsible for developing Portman's iron ore business in the Yilgarn region, said none of the undeveloped deposits in the area would be successful in their own right.

"Our idea is to talk to them (asset owners) and work with them to see if we can create something with them, where the quantity of iron ore is around 7 million tonnes to 8 million tonnes and can go for 15 years," he said.

Infrastructure, the biggest hurdle to entry for juniors in the Pilbara, is already established in the Yilgarn, with rail and port accessible. "Portman has been successful, shipping about 8 million tonnes and we think there is another business there based on these deposits in the central Yilgarn, blended together to make a similar sort of business," Mr Wedlock said.

"All these parties that own these deposits haven't come to the party but we are talking to them. It is in everyone's interest to work together and that's our strategy."