Australian iron ore miner, Fortescue Metals Group has delivered an upbeat assessment on the current iron ore market. In a presentation to investors in New York, CEO Andrew Forrest said he sees prices strengthening as China's ability to meet its own iron ore requirements declining fast.
Fortescue also gave an update on its operations in Western Australia where production is currently running at 40 million tonnes a year. The company is aiming to increase this to 55 million tonnes within the next 12 months.
The company’s feasibility study for its 60 million tonne a year Solomon operation is nearing completion. Capital expenditure on the project was likely to total $8.9 billion with $3.2 billion on the first stage and with a second stage to add an extra 100 million tonnes a year costing about $5.7bn.
Fortescue also indicated it envisaged a third rail hub linking the company's planned magnetite mining operations to the new Anketell Point port south-west of Port Hedland in WA.
Fortescue and Aquila Resources Ltd are driving plans for the new port, a short distance from Rio Tinto Ltd's major export port at Dampier.
The West Australian government gave the proposal the green light last week and has offered to contribute $3.5 million to its construction, which is expected to cost several billion dollars.
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