Tuesday 23rd Jul, 2019

Fortescue approves $3.7B Iron Bridge project

Image: Fortescue Metals Group

Fortescue Metals Group (FMG) and its joint venture partner Formosa have approved Stage 2 of the Iron Bridge Magnetite Project, which is set to create 3000 construction jobs and 900 once operational.

The $3.7 billion project, located 145 kilometres south of Port Hedland, will produce the equivalent of 20 million dry metric tonnes of magnetite ore per year at full operational capacity.

Stage 2 will include the development of a 22 million wet metric tonnes-per-year ore processing facility (OPF), an airstrip and expanded village, a 195-kilometre Canning Basin water pipeline and a 135-kilometre concentrate pipeline to Fortescue’s Herb Elliot port facility in Port Hedland.

FMG has committed to using local suppliers and contractors for products and services, and has put in place agreements with the Njamal and Kariyarra people to provide opportunities for local Aboriginal people.

The development follows the US$500 million ($703 million) investment into Stage 1 of the project, which involved construction of large-scale pilot and demonstration plants, which validated key equipment and magnetite production processes for the full-scale OPF.

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WA Premier Mark McGowan welcomed the announcement from FMG, congratulating the company on its milestone.

“It’s another encouraging sign that confidence is returning to Western Australia’s economy, and with thousands of jobs expected to flow from the Iron Bridge project, this will deliver a huge boost to our state,” McGowan said.

“This is great news for the Pilbara and great news for Western Australia. I look forward to working with FMG to ensure Western Australians, particularly in the Pilbara, will reap the benefits of this project in the years to come.”

“The Iron Bridge project holds Australia’s largest JORC-compliant magnetite resource supporting a long mine life,” Fortescue chief executive Elizabeth Gaines said.

“The project is well progressed and ready for detailed design and execution with the majority of key approvals already in place. The innovative design, including the use of a dry crushing and grinding circuit, will deliver an industry-leading energy efficient operation with globally competitive capital intensity and operating costs.

“Our focus has been to create the most energy and cost-efficient ore processing facility, tailored to the specific ore we will mine.”

This project will also deliver a premium product with iron content of 67 per cent, further enhancing the range of products available to Fortescue’s customers, according to Gaines.

When combined with the Eliwana development, the Iron Bridge expansion will increase Fortescue’s average product grade and provide the ability to deliver the majority of the company’s products at greater than 60 per cent iron, consistent with Fortescue’s long-term goal.

Coincidental to news of the approval, Fortescue has also updated the Iron Bridge’s magnetite mineral resource estimate, with ore reserves climbing up to 716 million tonnes on June 2018’s 705 million tonnes.

“This update supports the development of stage two of our Iron Bridge magnetite project announced today which holds Australia’s largest JORC compliant magnetite resource,” Gaines said.

“We are confident in the long-term demand for this premium product, supported by market fundamentals, including global supply conditions, investment in higher efficiency steel-making capacity, as well as the competitive advantage of proximity of the Pilbara to key markets in China and the region.

“We are ready to build this plant and develop this mine, and are confident that our early work will support rapid progress to full production.”

WA Mines and Petroleum Minister Bill Johnston said the project will unlock resources that were previously not previously able to get to market.

“Iron ore remains one of our State’s most important commodities, so this is great news for local workers and the WA economy,” he said.

Construction is expected to begin this year, with delivery of first ore expected in the first half of 2022.