WORK on the $4 billion Oakajee port and rail project is gathering speed as proponent Oakajee Port & Rail pushes toward completing bankable feasibility studies by the end of March.
WORK on the $4 billion Oakajee port and rail project is gathering speed as proponent Oakajee Port & Rail pushes toward completing bankable feasibility studies by the end of March.
Acting OPR chief executive Alwyn Vorster told WA Business News two key technical milestones had been achieved recently that would keep the project on schedule.
The project is expected to start construction in early 2011 and export its first shipload of iron ore in late 2013 or early 2014.
State Environment Minister Donna Faragher formally approved a three-year extension of environmental approvals for the port marine facilities on November 25.
The extension gives OPR until February 2013 to start construction of the marine facilities and was recommended by the Environmental Protection Authority in October.
Mr Vorster said this was especially significant as it would ensure a timely, and possibly early, construction start on the two kilometre-long breakwater and other sea-based common-user infrastructure, which is being funded by a $680 million pledge from the state and federal governments.
The breakwater is the single most important item in the development schedule, as it will take a minimum of 30 months to construct.
“OPR has the design and construction rights over that, but if they (government) make funds available earlier than we conclude our overall studies, in theory it is possible to commence construction earlier,” Mr Vorster said.
“The significance of that ... is that it will de-risk the development of the rest of the Mid West supply chain.”
Furthermore, Mr Vorster said the WA government had also formally declared a 4km wide feasibility corridor to be a public work.
The move has effectively determined which of several potential rail routes between Oakajee and the Weld Range and Jack Hills iron ore mines would be developed.
“The governor of WA, with the consent of the cabinet, has declared the rail corridor a public work,” Mr Vorster said. “With that come certain benefits that will facilitate development of the corridor.”
Mr Vorster said the 4km wide corridor would be formally ratified by parliament via legislation in the first half of next year. Once geotechnical drilling has been completed along the route, it will be narrowed to a final 100 metre-wide easement and permanent acquisition agreements with landholders will be finalised.
Mr Vorster said OPR was committed to completing a bankable feasibility study for the port and rail development by the end of March next year.
By the same date, it would finalise the detailed implementation agreements for the delivery of the project with the state government.
“Those are really an extension of the state development agreement, but are far more detailed on the nuts and bolts of how the port and rail will be constructed and run,” he said.
Mr Vorster said he also expected to make “serious progress” over the next three months with respect to offtake discussions with prospective foundation port and rail customers, most notably the Jack Hills, Weld Range and Karara iron ore projects.
Based on initial analysis, demand may require an almost immediate expansion of the port from its 35 million tonnes per annum stage one export capacity, he said.
Mr Vorster said financial close for the project was expected within 12 months of completing the bankable feasibility study.
