The state government is likely to throw open the development of new port and rail infrastructure in the Mid-West region to a public tender in response to apparent divisions between members of the Geraldton Iron Ore Alliance.
The state government is likely to throw open the development of new port and rail infrastructure in the Mid-West region to a public tender in response to apparent divisions between members of the Geraldton Iron Ore Alliance.
Planning and infrastructure minister Alannah MacTiernan told WA Business News the government had not made a final decision but it was likely to pursue an expressions of interest (i.e. tender) process.
The alternative was to give the project proponents, through the Geraldton Iron Ore Alliance, the right to manage the development of new infrastructure, which was needed to service several proposed iron ore mines.
“We are expecting an EOI process,” Ms MacTiernan.
“That is likely, particularly when we see that different players seem to be going in different directions.”
Her comments followed Murchison Metals’ announcement that it had established a consortium with Mitsubishi, Toll Holdings and South Korea’s Posco Engineering to develop a new port at Oakajee and a new rail line.
“It’s not clear that they are all acting in unison when you look at that media release,” the Minister said.
“The statement adds another element of concern.”
Ms MacTiernan said the government had been hoping to a make a final decision on the contracting process by the end of June but this would be delayed by a month.
“We want it signed off by the end of July.”
Murchison purports to be acting in the interests of the entire industry.
Its executive chairman Paul Kopejtka emphasised this week that the $1.6 billion project was designed to provide open access infrastructure that could be used by a range of miners and other industries.
The ultimate capacity of the deep water port would be 160 million tonnes per year, which would far exceed projected iron ore production.
Murchison has already commenced a feasibility study, expected to cost about $15 million, into the proposed infrastructure.
It initially announced this week that its consortium partners would conduct the study but later issued a clarifying statement saying this would not be the case.
Mr Kopejtka said other companies would be able to join its consortium.
Murchison managing director Trevor Matthews added that the company was working closely with other alliance members.
“We have taken account of the needs of the other companies,” Mr Matthews said.
However this has not satisfied all industry players.
“Murchison have jumped the gun,” one industry source said this week.
“What they are doing is not necessarily consistent with the plans of the others in the industry”.
Geraldton Iron Ore Alliance chairman Clive Brown said a lot of planning was still needed, with alliance members “seeking to find common ground” on issues like the port, the adjacent industrial estate and the route for the rail line.
Mr Brown, the former state development minister, also said that, other than Oakajee being named as the preferred port site, the public policy issues had not yet been resolved.
“We don’t want to spend tens of millions of dollars on this before those policy decisions are made,” Mr Brown said.
The members of the alliance are Murchison Metals, Midwest Corporation and Gindalbie Metals, which are planning to use the new port at Oakajee, and Mt Gibson Iron and Golden West Resources.
Ms MacTiernan said many groups outside the alliance had expressed an interest in being involved in the infrastructure development.
“I’ve been amazed at the level of interest.”
Similarly, Mr Brown said he had been contacted by many companies interested in either funding, building or operating infrastructure in the region.
(This is an updated version of the article published on 29 June 2006)
