Pilbara discovery sees Stokes add some iron to his empire
By BARRY FitzGERALD RESOURCES EDITOR
KERRY Stokes has become a multibillionaire from his range of media and mining equipment supply business interests. Now he is on his way to adding ``iron ore magnate'' to his portfolio of personal titles.
His 52 per cent-owned, ASX- listed Iron Ore Holdings has confirmed its Iron Valley discovery in Western Australia's central Pilbara region as one of the best by a junior company in recent times.
Maybe so, but Iron Valley is no different from other discoveries because the deposit will remain just a discovery unless IOH can get the ore to the coast by piggy- backing off the jealously guarded rail and port handling systems of either Rio Tinto, BHP Billiton or Fortescue.
Mr Stokes' influence in WA, and his connection with Rio iron ore boss Sam Walsh, are what has given IOH the edge on other juniors in the past, with Rio signing a ground- breaking mine-gate sales deal last July for another IOH project, the smaller Phil's Creek.
Whether a similar deal _ Rio will be looking after that project's rail and port needs _ is struck on Iron Valley remains to be seen. Officially, IOH will be looking at all development options for the find.
After board meetings at West Australian Newspapers would be a good time for a chat. Mr Stokes became WAN chairman in Decem ber after orchestrating a board spill from his 22 per cent WAN shareholding base. Mr Walsh joined him as a non-executive WAN director at the same time.
Latest exploration results at Iron Valley have outlined a south ern extension of the high-grade deposit, which is of the much- prized Brockman type. Brockman ores sit at the top of the quality tree of Pilbara iron ores.
IOH had previously outlined 88million tonnes of the ore, with the latest exploration pointing to an increase to more than 100 mil lion tonnes, plus what might come from additional exploration.
The size and style of deposit are such that IOH can ponder having Iron Valley in production from the second half of 2012 at an annual rate of 5 million to 10 million tonnes, worth $380 million to $770million at current prices.
That's not in the league of Andrew Forrest's and Gina Rein hart's Pilbara iron ore riches. But when you already control the Seven Network, WAN and one of the world's biggest franchises for Caterpillar mining and industrial equipment, it doesn't really matter.
IOH shares closed 2.5, or 5.2per cent, higher at 50, valuing the group at $58 million.
UMC Price at posting:
88.5¢ Sentiment: Buy Disclosure: Held
