Australia's Atlas Iron and
heavy haulage rail company QR National are looking to develop an
independent railway in the Pilbara region of Western Australia, which
would transport iron ore for Atlas' mines as well as other companies
operating in east and southeast Pilbara to Port Hedland.
The two Australian companies have entered into a binding memorandum of
understanding to progress the feasibility of an independent railway to
connect iron ore deposits owned by various operators in the region.
The study is expected to be completed by the end of this year and will
consider the construction of a 600 km railway at a cost of A$3.5 billion,
with first haulage for as early as 2015, Atlas said in a statement
Thursday.
Under the agreement, Atlas and QR National will share the costs of the
study and both will contribute resources as required.
Atlas intends to use rail haulage as part of its strategy to boost
production from 15 million mt/year to as much as 46 million mt/year.
"We believe an independent railway offers Atlas a highly attractive
means of growing its production to as much as 46 million mt/year, enabling
the company to realize the immense value of its one billion tonne resource
inventory and extensive port capacity," Atlas Iron managing director
Ken Brinsden said.
Atlas has been looking for a rail solution to transport its iron ore for
some time and it currently trucks 6 million mt/year to the Utah Point
facility. Atlas previously said that it needs a rail solution in place
before it moves to its 22 million mt/year target and beyond.
"The potential development of an independent Pilbara rail network
could represent a paradigm shift for the progressive development of the
Pilbara, breaking open long-standing barriers to new entrants to the iron
ore industry," Brinsden said. The railway would be beneficial for all
companies involved as well as Western Australia and the rest of Australia,
he added.
Source: Platts |
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