Friday, 24 Jun 2011
It is reported that state owned Chinese metals producer and trader Sinosteel suspended work on its AUD 2 billion Weld Range iron ore mining project in Australia's Midwest region due to setbacks in developing port and rail infrastructure.
Mr Julian Mizera COO of the Sinosteel subsidiary Sinosteel Midwest Corp said in an email “We are certainly not closing the door on Weld Range, however, we must make the right business decisions in order to protect our assets and ensure a realistic future for our organization.”
He said “Unfortunately we have now had to draw a line in the sand.”
Mr Mizera, citing expectations of further delays to the development of the Oakajee port and rail project beyond a revised completion date of 2015, added that it would cost the company's Australian unit AUD 100 million per year.
The project took years to set up and Sinosteel was one of only a handful of miners seen pioneering a second iron ore belt in Australia beyond the vast Pilbara region 1,500 kilometers to the north.
The midwest region of far west Australia is viewed as fresh hunting ground for foreign prospectors, many from Asia, hungry to tap Australia's abundant cache of minerals but virtually barred from the ore richer Pilbara by sector heavyweights Rio Tinto and BHP Billiton .
Sinosteel is one of the foundation customers for the planned Oakajee deepwater port, a venture operated by Australia's Murchison Metals and Japan's Mitsubishi Corp. Sinosteel's withdrawal leaves Gindalbie Metals Karara iron project and the Jack Hills mine owned by Murchison and Mitsubishi, as the two remaining customers for Oakajee. (sourced from Reuters)
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