NRW in talks with FMG for rail works

Welshpool-based NRW has revealed it is in talks with Fortescue Metals Group for the rail component of FMG's Pilbara expansion.

In a statement to the Australian Securities Exchange NRW said it would advise the market once any definitive agreement had been reached.

On Friday FMG announced it was well "advanced in engaging contractors it has strong working relationships with to commence earth works in early 2010 for the main line duplication."

The works include the duplication of some 120km of existing track, the construction of a new 130km spur line out to Solomon, the construction of four new bridges and the completion of two new rail loops at the port to deliver into a new dual train unloader for conveying to an expanded port stockpile area.

NRW said it had already successfully completed 120km of the original main line formation from the Cloudbreak mine.

The contractor said that it had continued a strong working relationship with FMG since, with on-going civil and mining works.

See statement from NRW below:

NRW confirms that the Company is one of the Contractors referred to in the Market Release by FMG Fortescue on 19 November 2010 (extracted in part below) and has been negotiating with Fortescue in respect to the works involving duplication of the existing main line.

"The rail works program includes the duplication of some 120km of existing track, the construction of a new 130km spur line out to Solomon, the construction of four new bridges and the completion of two new rail loops at the port to deliver into a new dual train unloader for conveying to an expanded port stockpile area. Fortescue is advanced in engaging contractors it has strong working relationships with to commence earth works in early 2011 for the main line duplication. The program also includes the complete upgrade of the existing signaling system. The construction of certain parts of the rail works (including the connection to the Solomon mines) are subject to a number of consents and approvals which are expected in 2011." (Fortescue ASX announcement - 19 November 2010)

As a matter of record, in 2007/2008 NRW successfully completed 120kms of the original main line formation from the Cloudbreak mine and reiterates the strong working relationship with Fortescue that has been maintained since, with ongoing civil and mining works across their operations.

NRW will advise the market once any definitive agreement has been reached between the parties.