13/01/2014 - 15:50

FMG buys Christmas Creek plants

13/01/2014 - 15:50

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Fortescue Metals Group has assumed "full operational responsibility" at its Christmas Creek mine after two fatalities in less than five months, announcing it has purchased the mine's ore processing facilities from Mineral Resources subsidiary Crushing Services International.

Fortescue Metals Group has assumed "full operational responsibility" at its Christmas Creek mine after two fatalities in less than five months, announcing it has purchased the mine's ore processing facilities from Mineral Resources subsidiary Crushing Services International in a deal estimated to be worth $300 million.

The purchase comes four months after FMG exercised powers to step-in and manage the two procesing facilities, to address its "operational concerns".

Mineral Resources said at the time it was confident that "temporary" step-in would be resolved "shortly".

The two companies said today they had worked closely together since September, with FMG employing 121 members of Mineral Resources' workforce. 

FMG chief executive Nev Power said the two companies had cooperated during the negotiations, ensuring a smooth transition.

"This outcome will assist in ensuring cultural alignment amongst the valued personnel who are responsible for the day-to-day operation of these important assets," he said.

FMG said the buy-out of the finance lease for the ore processing facilities continued its ongong debt repayment program. While the dollar value of the deal was undisclosed, sources in the broking sector put the price tag at around $300 million.

The Department of Mines and Petroleum warned FMG last month to improve safety procedures at the mine after a 33-year-old contractor was killed as he carried out maintenance on a large piece of mining machinery in the mine's heavy vehicle workshop.

It was the second fatality at the iron ore mine in less than five months, following the death of a 24-year-old electrician in August.

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