BHP WA iron ore asset president Brandon Craig remained tight-lipped on costs but has outlined the company's plan to increase production in the state, at a Business News event.
BHP WA iron ore asset president Brandon Craig remained tight-lipped on costs but has outlined the company's plan to increase production in the state, at a Business News Success and Leadership breakfast this morning.
The company has previously flagged plans to bump up iron ore production from 300 million tonnes per annum to 330mtpa.
Speaking at the event this morning, Mr Craig could not be drawn on expected costs, but said it would be in the billions if the company were to build a mining hub.
“If you think about the growth of the iron ore business, there’s a finite amount of capacity that’s available in Port Hedland,” Mr Craig said.
“That port will max out in about 600 million tonnes to 650 million tonnes of iron ore, because there’s constraints in the channel.
“It sounds like a small increment to go from 290 to 300 to 330 million tonnes, but the capital works involving in doing that is pretty significant.
“We would have to invest some multiples of billions of dollars around port and rail infrastructure and the same for developing new mines.
“Either we have to do something near one of our existing mines like Yandi or potentially build an entire new hub. If we go down the routes of hubs, that’s multiple of billions of dollars.”
Mr Craig said BHP had started conducting studies on the proposed production increase.
“In the next two years we’ll make decisions in terms on where we’re going to go,” he said.
Mr Craig said the state government had been supportive to the resources industry but there had been some issues in the efficiency of the approvals process.
“If I want to go and build a new mining hub, it would take me approximately eight years from start to finish to work through the studies, engineering, the construction but also the various approvals that needs to take place,” he said.
“We’ve reached a point now … where it’s the approvals and regulations that are becoming constrained to how fast we can actually execute our projects.
“That shows there’s been layers of approvals and regulations that have been added to what it takes to bring a new project into existence.
“Anything we could do to increase that speed and do that through reducing regulation or the efficiency of the regulation I think can definitely bring [projects] faster and cheaper in WA.”
