BYL shareholders might remember that BYL had a contract with...

BYL shareholders might remember that BYL had a contract with Karara Mining Ltd – a nice contract mining earner for a few years for BYL as Karara mined pockets of direct-ship haematite as a stand-in export product while Karara was progressing (badly, I add) its magnetite processing plant. I read today in a DOW announcement that it had secured a 4-year mining contract with Karrara worth $350m. Downer has been providing mining services to Karara since the magnetite operation commenced production in February 2012. Karrara is a JV between the Chinese Ansteel Group(52.16%) and Gindalbie Metals Ltd (ASX GBG).

BYL may not have had the equipment to mine magnetite, and as Karara has been a financial disaster, only sustained by Ansteel's deep pockets, so BYL could have considered investing in equipment for a Karara project as risky. Scooping up direct-ship haematite, in contrast, is a doddle. On the Karara woes – read http://www.smh.com.au/business/mini...key-to-karara-mines-fate-20160114-gm5wn0.html and various GBG Announcements.

I mention this matter as a macro background consideration – contract mining is not dead.