Fortescue Metals Group chief Andrew Forrest has signaled an appetite for another high demand commodity, bauxite.
Fortescue Metals Group chief Andrew Forrest has signaled an appetite for another high demand commodity, bauxite.
Along with Queensland aluminum smelter proponent Aldoga Minerals, Fortescue has made a submission to the Office of State Development in relation to the development of a major bauxite resource in the State’s northern Kimberley region.
Other companies who had initially expressed interests in the Mitchell Plateau deposits, including Russian aluminum giant Rusal and local junior Intermin Resources, have confirmed they did not submit proposals.
It is unknown whether large Indian copper producer Indo Gulf Corporation made a submission, while the Aluminum Corporation of China (CHALCO) did not respond to an earlier June 30 2004 deadline.
The Rio Tinto-led Mitchell Plateau Joint Venture, including Alcoa World Alumina Australia and Anglo Gold Australasia, currently controls the resource under a 30 year old state agreement due to expire at the end of June.
However, while the MPJV has been keen to hang on to the deposits under the agreement, which was extended last year by former State Development Minister Clive Brown, the Government is also keen on seeing the resource’s economics fully tested.
As a result Mr Brown invited other mining companies to review a mine and refine operation and forced the MPJV to make geological data from the resource available to the interested parties.
On the basis of the data third parties were then asked to submit an initial development proposal by the end of last month.
A WA Department of Industry and Resources spokesman said a number of submissions from “significant companies” had been received proposing more than one development option.
He said the department would analyse the submissions and provide advice to new State Development Minister Alan Carpenter who will then determine suitable submissions.
No time frame was given.
Mr Carpenter can also seek a proposal from the MPJV, which has already commissioned an independent study of the resource that showed it to be uneconomic.
This is contrary to both FMG and Aldoga positions.
They say the resource is economic and are keen to develop refining operations as required under the agreement.
Mr Forrest told WA Business News that FMG’s submission says the project is economic and recommended that it be looked at on an integrated basis.
“A lot of people want to dig it and ship it. We think that it should be value added,” he said.
Aldoga general manager, and a previous adviser to former WA Premier Carmen Lawrence, Marcelle Anderson confirmed Aldoga’s proposal conformed to the agreement requirements and said she was keen to talk to the new minister about Aldoga’s plans.
“We looked at how the deposits could be developed in the most efficient and cost effective way,” she said.
Intermin managing director Michael Ruane said the company, which had formed an association with a major overseas company interested in the resource, did not make a submission because of concerns about the invitation process.
“We would be delighted to look at the submission again on the terms that acceptance of a proposal is more clearly defined,” Mr Ruane said.
Rusal Australia managing director Duncan Heditch said Rusal had looked at the Mitchell Plateau data and, while it was open to reviewing the project, at this stage it had a number of other projects that were more attractive.
However, he raised concerns about the isolated location of the project.
“It’s certainly not the easiest place to develop a project,” Mr Heditch said.
