PLANS to make Kwinana the state’s sixth iron ore port have edged forwards after the Environmental Protection Authority extended a long-standing approval to develop an iron ore berth until 2015.
PLANS to make Kwinana the state’s sixth iron ore port have edged forwards after the Environmental Protection Authority extended a long-standing approval to develop an iron ore berth until 2015.
In May, Fremantle Ports and QR-owned Australian Railroad Group resubmitted applications to build a 4 million tonnes a year iron ore export wharf near its existing Kwinana facilities.
The wharf will meet the initial export needs of Mineral Resources as it develops its advanced Carina mine in the central Yilgarn.
Approval for the wharf was initially granted 10 years ago following an application by the Fremantle Port Authority, the old Westrail, and Koolyanobbing Iron, a subsidiary of local miner Portman.
Portman, which was taken over by US miner Cliffs Natural Resources two years ago, initially pushed for the development because it believed it would be cheaper and quicker to establish a new wharf at Kwinana than upgrading its existing export facilities at Esperance.
It also considered Kwinana a more appealing commercial option because it was closer to its primary ore customers in North Asia.
However, it opted against the plan due to weak iron ore markets early in the decade.
Though the approval was extended again in 2005, as iron ore markets took off, Portman then opted to back a major upgrade to double Esperance’s export capacity to 12mtpa.
Koolyanobbing Iron was not a party to the current application for renewal, with the FPA and ARG acting without any binding customer offtake contracts in place.
However, the EPA noted that the port authority had signed a memorandum of understanding with Mineral Resources to evaluate exporting via Kwinana, and that it believed the facility was still needed.
MinRes expects to start shipments from its 4mtpa Carina mine in January next year, at which point Kwinana will beat Cape Preston, Albany, Oakajee, and Anketell to become WA’s sixth iron ore export port.
Meanwhile, Cazaly is also awaiting a firm capacity allocation at Kwinana to allow its planned 4mtpa Parker Range mine to start exporting by late next year. It has already struck financing and offtake arrangements for the $78 million project, and has negotiated a rail-to-port haulage deal with Pacific Rail.
Approving the extension, the EPA has given Fremantle Ports and ARG until July 2015 to start construction, but warned it was unlikely to extend the approval again.
It has also added extra conditions, which require pile driving to be suspending if any whale comes within 500 metres of the work.
While Kwinana gears up to export its first iron ore, negotiations are also continuing to further increase iron ore exports from Esperance.
Unlisted Cashmere Iron, a founding member of the newly-formed Yilgarn Iron Producers Association, confirmed to WA Business News that it had signed a memorandum of understanding with the Esperance Port Authority to evaluate exporting hematite from the port as early as 2012.
Chairman David Hendrie said Cashmere would need access to the bigger planned Oakajee port to develop its 1 billion tonne Cashmere Downs magnetite resource, south of Sandstone, but hoped to generate early cash flow by exporting small volumes of hematite within two years.
“We do have an MoU with Esperance, but it’s still in the negotiation stage at the moment,” he said. “It’s a case of we might have an opportunity to get into production quicker by using Esperance initially, and then waiting to see what happens with Oakajee.”