30/07/2008 - 22:00

Oakajee decision reignites debate

30/07/2008 - 22:00

Bookmark

Save articles for future reference.

An air of uncertainty still surrounds the $2 billion Oakajee Port project, despite the state government selecting Oakajee Port and Rail Pty Ltd as the preferred developer.

An air of uncertainty still surrounds the $2 billion Oakajee Port project, despite the state government selecting Oakajee Port and Rail Pty Ltd as the preferred developer.

OPR, which is owned by Japanese company Mitsubishi and iron ore hopeful Murchison Metals, won a drawn out tussle with Chinese government-backed Yilgarn Infrastructure for the rights to develop the deep-water port near Geraldton.

The finished port is estimated to initially be able to handle up to 35 million tonnes of exports a year, with a large portion of that expected to come from Murchison, the Sinosteel Corporation-controlled Midwest Corporation and Gindalbie Metals.

But Planning and Infrastructure Minister Alannah MacTiernan said both Murchison and Midwest "still needed to prove up their resources" and make arrangements to underpin the investment in port and transport infrastructure.

Commenting on the win, OPR chief executive Christopher Eves said construction of the port would begin as early as 2010, once the company had secured environmental approvals.

"The next step is that the government and OPR will negotiate over the next six months the detailed terms of the development agreement, which will cover the development of the infrastructure," he said.

"Shortly following we'll be concluding relationships with contractors and the consultant team and the main group...to get to financial close on the project within about 12 months."

Yilgarn director Nick Catania said while the decision was disappointing, he did see a silver lining. "The loser of the Oakajee Port proposal has the right through Mid-West [Development Commission] to build the second berth and rail," he said.

However, WA Business News understands that any miner with proved resources that can justify a new berth could build one, subject to approval.

While OPR will own and control the initial Oakajee berth, the state government would retain ownership of the port, which would be managed by the Geraldton Port Authority.

Ownership of the common-use infrastructure, such as the breakwater, channel and turning basins, would be transferred to the Port Authority upon completion, with third party access to private-use infrastructure such as berths and loading equipment, "on fair and equitable terms, and on a commercial basis" with OPR.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

Subscription Options