Article by Elouise Fowler courtesy of the Australian Financial Review.
Gina Rinehart has signed an agreement for the “sleeping giant” of iron ore to be exported over the Roy Hill railway and port infrastructure with first shipment set for 2023.
Ms Rinehart committed her company, Hancock, to lead and run the project in a signing ceremony with the joint venture partners this week.
Gina Rinehart: “We have an outstanding group of partners, and we believe that now is the right time.”
The agreement unlocks the long dormant Australian Premium Iron (API) project for the patient shareholders, who back in 2014, expected the project to be a $US7.4 billion mine, rail and deepwater port development.
But iron ore prices slumped dramatically in the two years after the acquisition, meaning the project was largely abandoned until the past 18 months, when some members of the joint venture set about trying to revive it to seize on high iron ore prices.
Under the fresh agreement, Hancock will first undertake the “bankable feasibility” study and if given final investment approval by the joint venture partners, Hancock will develop and operate the project.
Ms Rinehart said the venture, dubbed “The Hardy” project, has “waited years for the right window to proceed to development.”
“We have an outstanding group of partners, and we believe that now is the right time for the Hardy project to be progressed,” she said.
API shareholders are Chinese state-owned steel maker Baowu, which has an indirect stake of 42.5 per cent, South Korean steel giant POSCO with a 24.5 per cent stake and US commodities trader AMCI with a 25.5 per cent stake.
In late May a subsidiary of Rich lister Chris Ellison’s Mineral Resources bought rail giant Aurizon’s 7.5 per cent indirect stake in the venture.