Elizabeth Gaines says Fortescue has had boots on the ground at a prospective iron ore deposit in Gabon, firming up the company’s exploration plans and a potential iron ore foothold in Africa.
Elizabeth Gaines says Fortescue Metals Group has had boots on the ground at a prospective iron ore deposit in Gabon, firming up the company’s exploration plans and a potential iron ore foothold in Africa.
The outgoing Fortescue chief executive delivered an address to the Diggers & Dealers forum this morning.
Ms Gaines had been due to speak in-person in Kalgoorlie, but opted to deliver Fortescue’s presentation virtually due to reported weather impacts on outgoing flights from Perth.
“It’s very fitting that my last public speaking appointment as CEO is at Diggers, having participated in this event for the past four years,” Ms Gaines said.
Finer details of a leadership transition have not been explicitly outlined, though Andrew Forrest is set to take her place in leading the iron ore business.
Ms Gaines will move to an ambassor role with Fortescue Future Industries and non-executive director at Fortescue.
Asked about the miner’s plans to secure a foothold in African iron ore, Ms Gaines told Business News a team had been on the ground at the Belinga deposit in Gabon.
Fortescue announced it had entered a three-year exclusivity period in December last year with the Gabon government to assess the potential early-stage project.
Few updates have been provided on progress at the site since then.
“We announced a little while ago that we’d entered into exclusivity period with the Gabon government for the Belinga deposit,” Ms Gaines said.
“We’ve had a team visit Belinga, so we’ve had people on the ground assessing the orebody, the existing infrastructure, so that’s the early-stage analysis.”
Ms Gaines said the company’s intention was to undertake exploration activities.
“We’re continuing to negotiate final agreements with the government but our intention is to undertake exploration studies on that opportunity,” she said.
It comes amid a recent decision by Rio Tinto to push ahead with establishing infrastructure at the Simandou project in Guinea after years of negotiations.
Costs and climate
Ms Gaines said the energy landscape had changed dramatically since Russia invaded Ukraine, but that industry should not allow scarcity to exacerbate the climate crisis.
“Energy security is now the world’s greatest concern,” she said.
“Twelve months ago, the cost of crude oil was around $US70 a barrel. This is in comparison to recent levels of over $US100 a barrel.”
Ms Gaines said inflationary pressures would continue given the current geopolitical climate and that it was imperative for the sector to divert from fossil fuels.
“I don’t have to tell anyone in this room the impact this is having on both the direct and indirect cost of production,” she said.
“This could get worse given the current geopolitical environment.
“It’s imperative for all of us to accelerate our transition to green energy and reduce our reliance on fossil fuels, so we can protect and maintain our cost base and our margins.”
Fortescue has estimated costs to develop its latest operation-Iron Bridge Magnetite-will be between $US3.6 billion and $US3.8 billion, with first production expected in the March 2023 quarter.