Chinese will only work with us: Yilgarn

24/11/2008 - 15:39

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Yilgarn Infrastructure has continued its rearguard bid for a slice of the planned Oakajee port and rail project, claiming today that its Chinese partners would not work directly with the government's preferred bidder.

Chinese will only work with us: Yilgarn

Yilgarn Infrastructure has continued its rearguard bid for a slice of the planned Oakajee port and rail project, claiming today that its Chinese partners would not work directly with the government's preferred bidder.

Last week, Murchison Metals told shareholders that it was progressing well with plans for the $1.5 billion project, via its joint venture company Oakajee Port and Rail, which is half-owned by Japan's Mitsubishi Development.

Murchison said this included using Chinese suppliers, which is a new requirement imposed by Premier Colin Barnett.

Yilgarn, backed by rival iron ore miner Midwest Corporation and a consortium of Chinese companies, was the losing bidder in the Oakajee tender process.

In a statement today, Yilgarn said it had received commitments from its Chinese alliance of engineering and funding partners that they will develop the port only with Yilgarn.

"Although OP&R had made non-specific proposals to them in Beijing seeking their finance, engineering services and iron ore from the Mid West mines in which the Chinese have invested, the alliance confirmed that they remain committed to Yilgarn as their partner in the provision of infrastructure to enable exports of the iron ore," Yilgarn executive chairman John Saunders said.

"Chinese companies are critical to the project outcome and will not be relegated to the role of OP&R suppliers.

"Yilgarn - an independent Australian-owned infrastructure provider - is China's Australian partner in the provision of rail and port infrastructure in the region."

Dr Saunders added that Yilgarn had spent several years forming relationships with its Chinese partners, securing debt and equity funding support and mine customers.

"We are determined to see this work and investment bear fruit for all stakeholders - and that includes a willingness to meet the Premier's requirement for cooperation," he said.

"However, in order to progress this cooperation, our Chinese partners - as the major investors in the Mid West's mines and the customer of the ore - must have their requirements in this infrastructure development recognised and met.

OPR released a statement this afternoon stating: "As the sole appointed proponent for the Oakajee project, OPR looks forward to continuing to work with all relevant parties on this strategic infrastructure project for the benefit of all miners and the mid-west region".

 

The full Yilgarn statement is pasted below:

CHINESE CONFIRM SUPPORT FOR PREMIER AND YILGARN INFRASTRUCTURE


Yilgarn Infrastructure has disputed claims from Murchison Metals at its AGM last week
that OP&R project funding and early project delivery are in place and that OP&R can
work directly with Chinese suppliers and funders for the development of the Oakajee
Port.
Yilgarn Executive Chairman John Saunders said that the Company's Chinese alliance
engineering and funding partners had confirmed last night that they fully supported
Premier Colin Barnett's proposal to fund the Common User Infrastructure (CUI). As they
had told the State Government, the alliance also remained committed to financing the
development of a Mid West rail network and a berth at Oakajee.
"Although OP&R had made non-specific proposals to them in Beijing seeking their
finance, engineering services and iron ore from the Mid West mines in which the Chinese
have invested, the alliance confirmed that they remain committed to Yilgarn as their
partner in the provision of infrastructure to enable exports of the iron ore," Dr Saunders
said.
"The development of a Mid West rail network and the Oakajee Port clearly needs China's
participation to go ahead and be viable, which is why Premier Barnett has asked for
cooperation between proponents.
"China has invested in four mines in the region, it has the funds and the construction
expertise and is the major customer of the ore from the Mid West region. It has made
huge investment in the Mid West's mines. Chinese companies are critical to the project
outcome and will not be relegated to the role of OP&R suppliers. Yilgarn - an
independent Australian-owned infrastructure provider - is China's Australian partner in
the provision of rail and port infrastructure in the region.
"Therefore, the only way that OP&R can meet Premier Barnett's requirement for
cooperation with Chinese interests is by cooperating with Yilgarn."
Dr Saunders said Yilgarn had committed several years to developing the Chinese
relationships and roles and many millions of dollars of its Australian shareholders' funds
to progressing the Mid West Rail and Oakajee Port infrastructure project, winning
strategic Chinese debt and equity funding support and securing mine customers on the
back of thorough due diligence.
"We are determined to see this work and investment bear fruit for all stakeholders - and
that includes a willingness to meet the Premier's requirement for cooperation," he said
"However, in order to progress this cooperation, our Chinese partners - as the major
investors in the Mid West's mines and the customer of the ore - must have their
requirements in this infrastructure development recognised and met.
"The future of Oakajee and the growth of the Mid West - particularly pertinent in these
troubled economic times - depends on it."


 


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