Aurizon's West Pilbara iron ore joint venture has won backing from one of Australia's big four banks, ANZ Banking Group.
ANZ announced today a memorandum of understanding with the West Pilbara partners, which include Baosteel Corporation and China Development Bank, as well as Aurizon, to work collaboratively towards a financing agreement for the development of the mine as well as its port and rail infrastructure, including the long-awaited deepwater port at Anketell.
Aurizon's other partners in the project are South Korean steelmaker POSCO and American Metals and Coal International.
The bank said today's agreement could involve the development of the mine, as well as processing, rail and port infrastructure, including a new deepwater port at Anketell and a 280-kilometre railway.
The project, including the port and rail infrastructure, has previously been costed at more than $7 billion.
Earlier this month, Aurizon managing director Lance Hockridge was cautious regarding the project due to the depressed price of iron ore, but said he was confident it would proceed to development.
The project partners have previously said they were targeting first iron ore exports in 2017-18.
Production projections for the mine are for around 40 million tonnes per year, as a base case scenario.
ANZ senior managing director of international and institutional banking Cathryn Carver said that should the West Pilbara project proceed, it would have the potential to unlock development of mineral resources across the region, which previously has been stranded by a lack of infrastructure.
ANZ also announced a separate MOU with China Development Bank today, to encourage further Chinese investment in Australian projects.
The banks said the deal would likely boost the amount of finance available for new mineral resources developments.
“ANZ and CDB will work together to match corporate partners and project investors, as well as provide advice and funding,” ANZ said in a statement.
The MOU was signed by ANZ chief executive Mike Smith and CDB chairman Hu Huaibang.
Meanwhile, National Australia Bank has also signed an MOU with the Export-Import Bank of China today at the same ceremony in Parliament House, to enhance the coordination between the two banks in multiple areas.
NAB group business banking executive Angela Mentis said the signing of the agreement would further unlock Chinese markets for Australian businesses.
“More markets open for Australian businesses means more jobs here in Australia,” Ms Mentis said.
The MOU is said to enhance coordination between the two banks in areas such as syndication, project finance, daily FX trading, derivative trading and export/import credit.