FYI, article in The West Australian. "and bear in mind to build...

FYI, article in The West Australian. "and bear in mind to build that port privately requires sales contracts from mines to customers, requires contributions from customers to the infrastructure pay charges,” Mr Barnett said.

GWR has 20% of Yilgarn Infrastructure who have contracts with most of the Mid West Iron Ore companies.
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The West Australian
Taxpayers could fund $300m port development
30th October 2008, 6:00 WST

Colin Barnett confirmed yesterday that he was willing to spend more than $300 million of taxpayers’ money to secure a port north of Geraldton which a private developer had already agreed to build and then give to the State.

Oakajee Port and Rail, a joint venture between Japanese giant Mitsubishi and Midwest iron ore hopeful Murchison Metals, won preferred developer status from the Carpenter government just before the election to build the $1.5 billion multi-user port at Oakajee.

Part of that deal was for OPR to hand so-called common user infrastructure — a sea wall, channel and ship’s turning basin — to the Geraldton Port Authority after completion.

But the Premier has asked the Federal Government, through its Infrastructure Australia fund, to share the cost of developing the outer harbour, which carries a price tag of about $650 million. OPR would be left to build the port’s berths, loading facilities, conveyor belts, reclaimers and associated industrial areas.

Shadow strategic infrastructure minister Alannah MacTiernan said Mr Barnett’s push to build the port would put the State’s submission to Infrastructure Australia in jeopardy.

“This bid is particularly bizarre given the Federal Government’s Infrastructure Australia assessment guidelines indicate that prioritised projects need to be those unlikely to be funded by the private sector,” Ms MacTiernan said.

But Mr Barnett, who has long advocated ports remaining in public hands, said State and Commonwealth involvement would ensure the port was built on time and that the State would get revenue through capital cost charges against users including Murchison which would be exempt from such charges under the preferred developer scheme.

“I have a view that the State has a strategic and economic responsibility to bring on port projects. If the State takes on responsibility for the outer harbour, it will in my view anchor the project and the project is then likely to proceed,” Mr Barnett said. “I’m not saying they (OPR) couldn’t have delivered it, I’m saying the State will take a role and ensure it happens.”

Mr Barnett said despite OPR’s preferred developer status, current market conditions were against a timely completion of the project.

“It hasn’t been built yet and there’s still a long way to go before you would find a commitment in this financial market . . . and bear in mind to build that port privately requires sales contracts from mines to customers, requires contributions from customers to the infrastructure pay charges,” Mr Barnett said.

Asked why the State would build the port if it was becoming less viable in the current economic climate, Mr Barnett said the State had a “longterm view about economic development”. He said the tender process Ms MacTiernan had championed as infrastructure minister had “set Japan against China” and “was not in the best interest of the State”.

But Ms MacTiernan said if the private developer was getting cold feet on the project the returns were probably not there for the taxpayer.

OPR said yesterday its port and rail project was “financially robust” but welcomed Mr Barnett’s intervention.