Murchison Metals has dismissed reports that joint venture partner Mitsubishi Development wants to pull out of building the $4 billion Oakajee iron ore port and moved to address concerns about the structuring of the project.
Murchison Metals has dismissed reports that joint venture partner Mitsubishi Development wants to pull out of building the $4 billion Oakajee iron ore port and moved to address concerns about the structuring of the project.
Murchison and Mitsubishi are equal joint venture partners in Oakajee Port & Rail, which is developing a deepwater port north of Geraldton to overcome congestion at Geraldton Port.
Last week Murchison Metals said Oakajee would be delayed for up to six months as it waited for key agreements to be finalised.
It pushes out feasibility studies and means the first shipment through the port is now expected some time between late 2014 and early 2015.
It was originally slated for early 2014.
The delay raised the ire of Premier Colin Barnett who said there may be some need for some "modest restructuring" of the way work on the project proceeds.
On Friday Mr Barnett said "I say that in terms of Oakajee port and rail, while they've done a great deal of work and some very competent work, they have basically in their minds two projects."
Mr Barnett added: "Now the government mandate is over the railway and port project, the Jack Hills mine is a big project but it is one of several mining projects.
In a statement to the Australian Securities Exchange today, Murchison said it is not considering any "fundamental changes" to the joint venture agreements and that financing will not be affected by changes to the development timeline.
"Murchison believes that the current ownership structure is an appropriate structure for delivering the infrastructure projects," the company said in a statement.
Murchison said the two companies so far had spent $370 million on the project and would continue to incur significant expenditure in the period leading up to a final investment decision.
The two companies also are partners in Crosslands Resources, which is mining iron ore at the Jack Hills Expansion Project.
Murchison on Thursday announced changes to the schedules for the JHEP and Oakajee projects, saying there had been delays that had blown-out the timeframe for the works.
Murchison said feasibility studies for the expansion project and Oakajee Port and Rail were now expected to be completed in the second quarter of 2011, rather than by the end of calendar 2010, with a final investment decision due in late 2011 or early 2012.
"In requesting timetable changes under the State Development Agreement, Murchison and Mitsubishi reaffirmed their commitment to the mining and infrastructure joint ventures and to the completion of the BFSs within months," Murchison said on Tuesday.
"Murchison remains very confident that the mid-west infrastructure assets will be delivered within the revised schedule timetable and in a manner that will benefit all miners and others stakeholders throughout the region."
Murchison said a recent review had confirmed JHEP would play a pivotal role in developing the port and rail infrastructure.
"Based on current production expectations from foundation customers of the infrastructure project, Crosslands is expected to be the biggest initial customer and is therefore fundamental to the viability of the mid-west infrastructure business," Murchison said.
"Without Crosslands, the infrastructure project is not viable, as has been the case since the government of WA called for expressions of interest for parties to develop the infrastructure."
Murchison shares were down 12.73 per cent or 17.5 cents to close at $1.20.