PORTMAN Limited has broken two milestones – firstly with the shipment of its 20 millionth tonne to the port of Esperance and then with the announcement that it has approved a $20.3 million expansion for its Koolyanobbing operation.
However, the expansion is a shade of the $100 million expansion, complete with rail extension, the company once talked about.
Instead the company will be developing its northern tenement areas at Windarling and Mt Jackson and trucking the ore the 100 kilometres to Koolyanobbing for processing.
Portman general manager iron ore Richard Mehan said the decision to remove the rail component from the project had resulted in the smaller expenditure.
“At a conservative price of $70,000 a kilometre for standard gauge track plus the work we’re talking about here and you get close to the $100 million,” he said.
Mr Mehan said the Western Australian Government’s decision to limit its access to the site on environmental grounds had affected the company’s decision.
“Where the environmental decision has affected us is that it quarantined some ore and that led to us planning for lower volumes and that impacted on the rail line,” he said.
Portman commenced hauling iron ore to Esperance in 1994 with an initial program of 1.5 million tonnes in the first year.
In the past three years that haulage has increased from 2.5 million tonnes in 2000 to a projected haulage of more than 4.5 million tonnes for 2003.
The decision to ship the iron ore from Esperance led to strong protest from residents.
Esperance is renowned for its pristine white beaches and locals immediately had visions of their beautiful waterfront being turned pink by iron dust blown from stockpiles.
However, the ore stockpile facility, which is fully sealed and kept at a lower pressure than the outside air, has become an award winner and a drawcard for operators of ports that handle iron ore.
Portman also has an iron ore operation at Cockatoo Island off the North West coast.
Cockatoo Island, along with Koolyanobbing, are operations the company bought from BHP Billiton.
Operations were suspended at Cockatoo Island for a couple of months back in May due to problems with water in the iron ore.
The Cockatoo Island operation is notable for the fact that if it were not for a wall, the entire operation would be under the ocean.
An earth wall, built to be above the high tide mark, keeps the sea at bay.
Mr Mehan said the company was on track to have the dewatering problems figured out and hoped to be producing 100,000 tonnes of iron ore a month from the operation by next year.
He said the water in the iron ore was not due to seepage from the seawall but instead caused by aquifers within the ore body.
“We’ve done some geotechnical work that has told us the seawall is stable and we believe we can increase the depth of the pit,” Mr Mehan said.
“Once we’ve got the water under control we can run double shifts and get to our 100,000 tonne target.”
Portman has proven to be a fairly consistent performer, maintaining a strong share price while others faltered.
However, the stronger Australian dollar has knocked some of the shine off its efforts.
