FMG approves $417m new mine

Fortescue Metals Group’s has given the green light to its US$287 million ($417 million) Queens Valley mining area development, after it received all necessary environmental and heritage approvals.

The Queens Valley development will be an expansion of its Solomon Hub iron ore operations in the Pilbara.

In a statement, FMG said Queens Valley will maintain production of the low-alumina King Fines iron ore product, which is consistent with the company’s strategy of optimising margins through the through an enhanced product mix.

Fortescue estimates it will spend US$10 million on the project this financial year, ramping up to US$151 million next financial year, and US$98 million and US$28 million for the 2021 and 2022 financial years, respectively.

Located approximately 15 kilometres from the company’s Kings ore processing facility, Queens Valley is planned for operational launch in the 2022 financial year with an estimated mine life of 10 to 15 years.

The project will involve the construction of a hydraulic barrier wall and relocation of Solomon’s mobile maintenance facilities to maximise efficiencies.

Chief executive Elizabeth Gaines said the development is part of a product portfolio that maximises value from the company’s orebodies over the long term.

“The Queens mining area development will maintain our highly valued Kings Fines low-alumina sinter fines product which supplies Fortescue’s key customers in China as well as in Japan and Korea,” she said.

Queens Valley follows Fortescue's approval of Iron Bridge and Eliwana projects earlier this year.

Shares in Fortescue finished down 8.1 per cent to trade at $8.27 each.