Rio wins 95% iron ore hike from small mills 5:06 PM
Chinese state-owned steel firms are reportedly eyeing a stake in Australian iron ore miner Fortescue Metals Group Ltd , the latest in a number of overtures by Beijing to wield more control over much-needed raw material supplies.
However, two of the three Chinese firms named as potential buyers by The Australian newspaper on Monday said they were unaware of any plans to buy Fortescue shares.
The newspaper reported that Sinosteel, Chinalco and Baosteel were looking at a 16 percent stake in Fortescue that U.S. boutique fund Harbinger Capital Partners was considering selling.
"We're not denying it," Fortescue spokesman Paul Downie said. "We're not sure if Harbinger is a seller or not."
Harbinger and Sinosteel could not be immediately reached for comment. Officials of Baosteel and Chinalco in Shanghai said they knew of no strategy to take a stake in Fortescue.
Miner 'test runs' Port Hedland
Meanwhile, Fortescue's first iron ore shipment could set sail from Port Hedland in Western Australia as soon as Monday night.
This is one of potentially two 'test runs' before the company's official first commercial shipment of 170,000 tonnes begins being loaded on Thursday.
While commissioning its port facilities, Fortescue has spent the past six days loading the 70,000 tonne Blumenau Panamax-sized vessel, which could be replaced immediately by a second Panamax ship if required to complete the commissioning.
"We're dealing with one at the moment and maybe pulling the second one in tonight - it just depends on how well we've gone with the first one," chief operating officer Graeme Rowley told AAP.
Both 70,000-tonne shipments are bound for an as yet unnamed Chinese customer.
"It's not Baosteel (Fortescue's offtake partner) for these commissioning ships, it was a customer who was prepared to support us with the offer of a vessel at his cost," Mr Rowley said.
"These vessels are pretty expensive and we didn't turn around this vessel fast because the obvious thing we were doing was stopping and starting loading, depending on how various problems came up as we went through the process.
"We're very fortunate that this customer was happy to take those costs.
"Obviously, the ore is his and he pays us for that ... at the same commercial prices.
"So in one sense, it's a commercial deal but not a normal commercial deal in terms of timing and product.
"The vessel that comes in from Baosteel on the 14th (of May) will be regarded as the first post-commissioning vessel."
First official shipment worth $11.6 million
Mr Rowley said Fortescue's first shipment to Baosteel, using the Chinese steel mill's MV Hengshan Cape, would be valued at about $11.6 million.
"It will be ready at 1100 AEST on the 15th (of May) to receive its ore.
"Assuming everything goes according to plan, it should take about 30 hours to complete the loading.
"The passage will take 12 to 14 days."
Mr Rowley said the company was loading at a rate of about 7,000 tonnes an hour during a 12-hour shift, "which is good but I'd like to work it up greater than that".
"You can on good product runs get as high as 100,000 tonnes in a 12-our shift."
Mr Rowley appears to be relishing Fortescue's transition from iron ore explorer to producer this week - three and a half years after drilling the first hole at the Christmas Creek deposit, one of several deposits at the $2.8 billion Pilbara project.
He noted that the key 'first ore on ship' milestone had been delivered on time and said further exploration success was ahead.
Shares in Fortescue closed nine cents higher at $9.27.
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