http://www.abc.net.au/news/2011-11-22/murchison-metals-oakajee-pr...

http://www.abc.net.au/news/2011-11-22/murchison-metals-oakajee-project-doubts/3686020?section=wa

Shares in Murchison Metals are in a trading halt over speculation it is in talks to sell its interests in the Oakajee port.

Shares in Murchison Metals have been placed in a trading halt amid speculation the company is in talks to sell its interests in the troubled Oakajee Port and Rail project in Western Australia's Mid West.

Murchison has conceded it cannot fund its share of the Oakajee Port and Rail development or its Jack Hills iron ore deposit, estimated at $10 billion.

Resources analyst Peter Strachan believes the mystery buyer may be Murchison's Japanese joint venture partner Mitsubishi.

"They would certainly have front running as they would understand all of the numbers and I think the Japanese partners there are quite keen to secure iron ore for the long-term future of their steel making activities in Japan," he said.

"Of course, they are having to compete fairly aggressively with interests out of China."

Mr Strachan says it's good news for iron ore projects in the region.

"I think it's probably the only outcome that's going to save those projects," he said.

"The thing about iron ore is that it's not a rare commodity, what's rare is having iron ore with access to a port and a railway line, so the transport infrastructure is the real key element in looking at iron ore."