MOUNT Gibson Iron Limited and the Geraldton Port Authority have signed a contract to export 1.5 million tonnes of iron ore from the Geraldton Port to China.Under the arrangement, between Mount Gibson’s wholly owned subsidiary Geraldton Bulk Handling Pty Ltd and the port, the company will be responsible for unloading the rail wagons, transferring the iron ore to storage facilities to be constructed by GBH and the loading of iron products through existing ship loading facilities.The Port Services Agreement and Lease gives the Geraldton Port Authority the green light to carry out a $100 million port enhancement program. Improvements include a deepening of the approach and inner harbour to increase the size of shipments able to be handled by the port, particularly the Handimax vessels needed for the shipments.A three-month dredging program to remove spilt mineral ore sediments from the harbour has already started. WA company CGC Dredging has been awarded the contract to dredge 150,000 cubic metres of sediment from the harbour basin.Mt Gibson has agreed to supply the Port Authority with a $5 million bank guarantee and corporate guarantees to ensure the port receives $11.25 million of charges expected to be levied on the iron ore shipped in the next five years.Mount Gibson managing director Brian Johnson said that, to meet the bill, the company intended to place eight million 25-cent shares to raise $2 million, and also to seek financial support from a major shareholder or prospective iron ore purchaser.The deal with the Gerardton Port Authority puts on hold plans to build a port at Oakajee, near Geraldton, which the Court Liberal Government hoped to develop to meet the needs of a steel mill mooted by Kingstream.
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