mickey mouse approach not an option...

Mickey Mouse approach not an option: OPR chief

Tania Winter
Wednesday, 28 September 2011

A STAGED development for the much needed $A5.96 billion Oakajee port and rail project in Western Australia’s Mid West is not an option, and such an approach would be a “Mickey Mouse” solution, says OPR chief executive John Langoulant.



Oakajee Port and Rail chief executive officer John Langoulant.

Speaking this morning at Tonkin Corporation’s Mining the Mid West Conference in Perth, Langoulant acknowledged there had been a lot said about the project in recent times, particularly when it came to bankrolling the development by its joint venture partners Murchison Metals and Japan’s Mitsubishi Corporation, but at the end of the day he was confident it would proceed.

The most recent development has been an invitation for the Chinese to participate, backed up by WA Premier Colin Barnett’s recent visit to the Asian powerhouse, but he said interest had also been shown from South Korea.

However, he refuted any suggestion that the port or rail development could be undertaken in a staged manner.

“Some say you can stage the development but you can’t half build it and Mickey Mouse the construction of this port,” he said.

“About the only savings you can make, and we have looked at this every which way, is you could probably work off one berth if your capacity is not up to 45 million tonnes per annum and you probably could skinny down the stockpile area, but at the end of the day you are still talking about more than a $2 billion cost.”

These figures are based on a 45Mtpa capacity port facility and 70Mtpa railway line spanning 570 kilometres out to the Jack Hills site.

However, just how this line will tie in with potential railway lines to the south is yet to be determined.

“We don't have the rights to develop to the south, all we have is the first option right to build a connection off our rail system down to Mullewa … which is a significant limitation in terms of our rights in developing this rail infrastructure,” Langoulant said.

“You can’t Mickey Mouse railway systems if you are going to transport that amount of tonnage sufficiently.

“Can you stage a rail system?
“You can build a rail system to the south but it does nothing for development of the northern mines and I suggest to you that you can’t build a rail system to the south and fund development of the port unless you at least have 30 million tonnes to carry to the port, and there is no mine to the south that is close to that rate.”

He also silenced critics when it came to lack of construction activity.

“We all know you can’t start construction until you have environmental approvals … and this is another of the great untold stories of this project in that the environmental approvals are advanced and are now sitting on the minister’s desk,” Langoulant said.

“The rail corridor has been defined and is also awaiting approval, but as with all rail corridors, we need legislation through Parliament to build and are hopeful that legislation will move through Parliament later this year.”

However, he said there was still a bit of work to do in terms of clearances for the Square Kilometre Array project (a deep space radioastronomy facility) with the Commonwealth looking to push out the radio silence zone to 100km from 70km.

“So we really need to have coexistence and are in good quality discussions with federal officials and think it will go in our favour,” Langoulant said.

With a three-year construction timeline, at its peak development of both the port and railway will require 2600 workers, and while OPR intends to draw on local labour, it is fully aware that a component of fly-in, fly-out workers will be required.

It intends housing workers at a port village, while five smaller villages will be located along the rail line route.

In terms of native title agreements, Langoulant said OPR had also started to engage with the four traditional owner groups of the area.