No plans to lift volumes: Fortescue

Fortescue Metals Group has poured cold water over reports that its proposed Eliwana iron ore mine near Tom Price would produce more ore on an annual basis than the mine it would replace.

Fortescue’s plans for Eliwana, located west of the iron ore giant’s Solomon hub, were revealed in planning documents released by the Environmental Protection Authority yesterday.

The documents showed an average production rate of 30 million tonnes per annum and a mine life of 24 years.

However, the infrastructure that would be built at Eliwana could provide for a peak production rate of 50mtpa.

If that peak production became a reality, Eliwana could be producing 27mtpa more than the Firetail operation, where mining is due to be completed by 2020.

Eliwana is one of two options Fortescue is considering development of in order to maintain production when Firetail runs dry, with the other being a new operation at Nyidinghu, which lies south of the company’s Chichester hub.

Construction work could begin at Eliwana as soon as June 2019, according to the documents released yesterday.

In a statement today, Fortescue said the peak production rate estimate was consistent with normal approval processes and allowed for future flexibility.

“It does not reflect Fortescue’s production guidance,” the miner said.

“Fortescue determines its production rate in response to market demand and our customer needs and will continue to provide guidance consistent with our continuous disclosure obligations.”

Fortescue shares were 0.6 per cent higher to $5.40 each at 1:20pm.