12/06/2014 - 10:14

Mineral Resources wants to build Aquila project

12/06/2014 - 10:14

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Mineral Resources announced today that it plans to use its 12 per cent stake in Aquila Resources to push for a role building and operating the proposed $7 billion West Pilbara iron ore project.

Mineral Resources wants to build Aquila project
Mineral Resources managing director Chris Ellison.

Mineral Resources announced today that it plans to use its 12 per cent stake in Aquila Resources to push for a role building and operating the proposed $7 billion West Pilbara iron ore project.

MinRes said today that it had been developing a business case to deliver a fit-for-purpose solution for Aquila’s West Pilbara iron ore project.

It said it had finalised its mine-to-port development plan for the project and wanted to enter discussions with the project stakeholders, with a view to entering contracts for construction and delivery of the port and rail infrastructure, as well as build, own and operate arrangements for the mine infrastructure.

MinRes considered that a meaningful shareholding in Aquila was appropriate to ensure it was well positioned to be actively involved with other key project stakeholders, and intends to fully engage in collaborative discussions to ensure the project is brought into production as soon as possible.

Its surprise purchase of the 12 per cent stake in Aquila, disclosed yesterday, complicates the $1.4 billion takeover offer that Baosteel and Aurizon have launched for Aquila. 

MinRes paid $3.75 per share for its Aquila stake, suggesting that, at a minimum, Baosteel and Aurizon will need to lift their $3.40 offer price. 

Its 12 per cent stake, combined with Aquila chiarman Tony Poli's 29 per cent shareholding, means the bidders would likely be forced into further negotiations over both the takeover offer and the West Pilbara project development.

MinRes managing director Chris Ellison said the company had the skills to build, own and operate key infrastructure associated with the project and bring significant value to the table.

“We are confident that we can play and important role in delivering the project on attractive terms through building the port and other infrastructure for the project and build, own and operate arrangements in respect of the mine, which we have successfully employed previously,” he said.

“We have the financial capacity to make a meaningful capital contribution towards the development of the project and will now proceed to engage with all major stakeholders including Aquila and Baosteel to facilitate the best outcome possible.”

MinRes is the fifth largest iron ore producer in Australia and has experience in designing, constructing and operating large scale iron ore processing and logistics operations throughtout the Yilgarn and Pilbara regions of Western Australia. 

Mineral Resources’ share price fell by 3.55 per cent to $9.78 at 10:00am WST. 

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