$14bn rail, smelter plan gains traction

A Queensland-based consortium is pushing ahead with bold plans for a A$14 billion, 3300 kilometre rail line from the Pilbara to Queensland with industrial smelter hubs at each end after gaining support from 19 steel producers.

The company behind Project Iron Boomerang, East West Line Parks Pty Ltd, said the steelmakers have signed three-year confidentiality agreements to discover more about the project.

The steel companies were also said to be poised to make a commitment of $US10 million towards a bankable feasibility study, and in return will receive equity and "positions of influence" within the proposed equal-share consortium.

"While the company already has 19 of the biggest world steelmakers signed to the project, there are even much bigger leading world and Australian corporate sector organizations who have likewise signed to the project, including companies from the resource, banking and finance, engineering and construction, securities and investment sectors from many of the world's major countries," the company said.

The study is expected to cost $US150 million and take just over two years to complete.

The total cost of the project is estimated at $US45 billion with the construction and commissioning phase estimated $US12.4 billion, inclusive of rail line ($7.2 billion), rolling stock ($2.2 billion) and $3 billion for industrial land.

The company anticipates a commitment to the study by the end of the year and construction to start in 2010-11.

The project aims to produce pig iron and 12 blast furnaces, six on each coast, and then export it overseas rather than iron ore and coal both being shipped overseas to produce steel.

East West Line Parks managing director Shane Condon said the project is expected to create 35,000 construction jobs and 8000 permanent jobs at each end.

Below is the full announcement:

A visionary plan to build one of the largest industrial projects in the world will create more than 35,000 construction, administration and service jobs in northern Australia.

Project Iron Boomerang will also make north Western Australia and North Queensland two of the world's most efficient operating heavy industrial iron and steel producing feeder hubs in partnership with some of Australia's major trading nations.

The booming iron ore and coal industries of North Queensland and Western Australia will enter a new era of growth and prosperity as part of one of the largest resource development projects ever undertaken.

The revolutionary US$12.4 billion (note BILLION) Project Iron Boomerang (PIB) is one step closer to reality after recently securing support from 19 of the world's largest top steelmakers. This gathering of global steelmakers is already a significant achievement - their collective interest is believed to be a world first.

All have progressively signed 3-year confidentiality agreements to discover more about the scheme and most are poised to make a commitment of US$10 million to jointly fund the bankable feasibility and environmental assessment study of the project.

Shane Condon, founder and managing director of project proponent East West Line Parks Pty Ltd (EWLP), plans to establish an international steel-makers lead enterprise of global significance in Australia by building a 3,300km transcontinental railway line.

Ref: EWLP website www.ewlp.com.au 7 minute historic trans-continental crossing video.

The railway line, from the Pilbara in Western Australia to Queensland's Bowen Basin, will link the country's main coal and iron ore reserves and also construct 12 blast furnaces (6 on both coasts) to convert iron ore to slab steel for export to overseas steelmakers

Mr Condon is travelling to North Queensland next week to conduct a series of briefings for key industry and local government stakeholders. He will be in Townsville and the Burdekin on Monday August 11, Bowen on Tuesday August 12 and Mackay on Wednesday August 13.

"This purpose-built transcontinental railway line will link Australia's two great ore bodies in steel-making and will be dedicated to carrying resources efficiently from one side of the country to the other between the first-stage iron and steel smelting parks," Mr Condon said.

"The way we generally export iron ore (and coals to some extent) is very inefficient - it's 60 percent iron and 40 percent dirt. Then the ships come back empty, and the trains return [to mine] empty. We're talking about the world's biggest ships, trains and ports. About 45 percent of the total trip cost is the empty return."

"Every country eventually runs out of its mined ores. We need to manage and respect the efficient use now, and improve these efficiencies with resulting long-term sustainability management.

"Western Europe, Japan and Korea have run out of most of their raw materials. I would say it is simply not viable under present supply chain practices to be dependent on 100% or even 50% of bulk ore supply to the other side of the world."

Mr Condon said PIB offered one of the best and most profitable large-scale steel production places on earth to make globally competitive and sustainable first-stage steel feeder products for a 2nd stage mill and distribution hub.

Mr Condon said the project would generate 35,000 construction jobs over 3 ¼ years and 8,000 permanent jobs at each end, using a combination of both Australian and overseas steelmakers expertise under a 50/50 partnership human resource support scheme.

Prospective steelmakers and investors have been offered the opportunity to help fund Project Iron Boomerang's proposed US150 million feasibility 2 ¼ year study in return for equity and positions of influence within the proposed EWLP - PIB equal share consortium.

The overall cost of the project is estimated at US$12.4 billion: $7.2 billion for the railway line, $2.2 billion for rolling stock and $3 billion for the industrial estate lands for the smelter precincts.

While the company already has 19 of the biggest world steelmakers signed to the project, there are even much bigger leading world and Australian corporate sector organizations who have likewise signed to the project, including companies from the resource, banking and finance, engineering and construction, securities and investment sectors from many of the world's major countries.

Project Iron Boomerang has added appeal with the prospect of the Federal Government introducing an Emission Trading Scheme in the next five years.

"This plan is so environmentally efficient we do expect to generate considerable carbon credits, squarely based on practical commonsense efficiencies, plus the world steelmakers are continuously developing and making major technical advances which will be greatly enhanced and advanced within this project's concept and strategy " Mr Condon said.

"Our 300 page pre-feasibility report and spreadsheet figures already indicate that over 8 million t p/a of CO2 emissions savings are available, with total PIB efficiency potentials yet to be fully discovered in the next feasibility stage, indicating around 20-30 million CO2 per annum.

"By incorporating steelmakers from China and India in this global Australian project, the world's overall total emissions will be greatly advanced through co-operation between trading nations.

"The plan has been costed and it is very profitable. Project Iron Boomerang is a global "Blue Sky" project.

"It is a project not only for the boom times, but also for the ordinary and even the bad times. It can become a global project and example for all our future generations. "

Infrastructure will include a railway maintenance shed for 6,000 wagons and 80 of the biggest rail engines - the largest of their type in the world. This will be located in Queensland for human resource access reasons.

Mr Condon plans to hold Project Iron Boomerang mini-summits in countries of interest - China, India, Japan, Korea and Taiwan in the next few months.