A new day and again further rail access saga!Stop dreaming...

A new day and again further rail access saga!

Stop dreaming Juniors (ie. BRM) - Build Your Own Rail!





BHP rail snub irks juniors

7th August 2009, 6:00 WST



Pilbara iron ore juniors have reacted angrily to new signs that BHP Billiton has no intention of giving ground on third-party railway access, accusing the mining giant of being “in a state of denial”.

Seizing on comments by BHP Iron Ore boss Ian Ashby on Wednesday, the head of the Pilbara’s newest miner, Atlas Iron, yesterday described the company’s stance as “a tragedy”.

“I think it is actually really sad that the world’s biggest mining company would take such an obstructionist view on infrastructure which was built with a view to opening up a region and creating wealth for WA,” Atlas managing director David Flanagan said. “It is a tragedy.”

BC Iron managing director Mike Young said he was “staggered” by BHP’s hard-line stance, while another industry source who asked not to be named said the giant’s attitude threatened to destroy the junior mining sector.

“It just shows that they’re in a state of denial and that they don’t appreciate the haulage obligations (under their State Agreement),” he said.

“It’s not an imposition, there is no capacity constraint on the rail system … but the juniors are powerless.”

Speaking at Kalgoorlie’s Diggers and Dealers conference, Mr Ashby made it clear the miner’s opposition to third-party access had not changed, arguing its facilities were “running flat out” and describing haulage obligations under its State Agreement as “a moot point”.

Under BHP and Rio Tinto’s State Agreements, they are obliged to haul third-party ore.

However, both miners have long argued the rule only applies where spare capacity exists which, they say, it does not.

Mr Young said BHP faced the prospect of either working with the State Government and junior miners to look at how third-party demands could be met, or being forced to.

“I’m just surprised that they’re not trying to work with these companies,” he said.

WA Premier Colin Barnett, who has previously signalled he may use the proposed BHP-Rio Pilbara alliance to force the issue of thirdparty access, declined to comment yesterday.

But North West Iron Ore Alliance chief executive Justin Walawski said it would be “folly” to wait for revised State Agreements to change the playing field for juniors. He said that not only would it mean a long wait, but a united BHP-Rio would also have more bargaining power.

“I’m a little guarded about looking at the new State Agreements as the saviour for emerging producers,” he said.
“If they get the joint venture through (regulators) and then they turn to the State Agreements, we go back to the process of negotiation … so what’s changed?”.

KATE EMERY