04/11/2010 - 00:00

Hancock’s Roy Hill mine edges closer

04/11/2010 - 00:00

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Hancock’s Roy Hill mine edges closer

GINA Rinehart’s Hancock Prospecting has taken another step toward becoming an iron ore miner in its own right, securing mining leases for its proposed $7.2 billion Roy Hill mine in the central Pilbara.

Hancock this week said the Department of Mines and Petroleum had granted mining leases covering more than 27,600 hectares of land at the project, situated 150 kilometres north of Newman, estimated to host the project’s entire 2.3 billion tonne resource inventory.

The grant of the leases follows the recent passage of a state agreement for Hancock’s proposed 300km railway from the project to Port Hedland, construction of which is slated to begin in March next year.

The project is expected to produce 55 million tonnes of ore annually, and will require construction of a dedicated iron ore export berth at Stanley Point in Port Hedland’s congested inner harbour, adjacent to the $2 billion South West Creek facility planned by the North West Iron Ore Alliance.

Construction of the Roy Hill project will fulfil late iron ore pioneer Lang Hancock’s vision of developing and managing the family’s own iron ore operation.

Currently, Hancock’s iron ore revenues come from royalties over a string of projects, and its half share in the Rio Tinto-managed Hope Downs and Hope Downs 4 mines.

Rio approved the $1.6 billion Hope Downs 4 mine last quarter as part of the $4.2 billion in spending given the green light during the period to boost its Pilbara capacity by 50 per cent to 330mtpa by 2015.

Development of Hope Downs 4 also improves the development prospects of the Rhodes Ridge deposit nearby, which has been subject to an ownership dispute between Hancock and Wright Prospecting. In March the WA Supreme Court ruled that Hancock should give up its 25 per cent stake in the Rio-controlled project to Wright in line with a disputed agreement between Mr Hancock and former partner Peter Wright.

 

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