State seeks to restart Mid West port-rail development

The state government has sought to break the deadlock confronting much-needed infrastucture to service the rapidly emerging Mid West iron ore precinct with a plan to separate the rail and port elements.

Planning and infrastucture minister Alannah MacTiernan announced that the two mining companies at the heart of the issue - presumably Midwest Corporation Ltd and Murchison Metals Ltd - or their nominees may contest the right to construct a multi-user port at Oakajee north of Geraldton.

Ms MacTiernan added that WestNet Rail would be given the opportunity to ensure their were rail links with both ports and other rail lines.

She said in a statement that the government would not stand in the way of any company that wanted to go ahead with their own rail lines to Oakajee.

Midwest Corporation is aligned with the China-backed Yilgarn Infrastructure, which is competing against a Murchison Metals-Mitsubishi Corporation joint venture to develop the new infrastructure, at a cost of up to $3 billion.

A spokeswoman for Yilgarn said the company looked forward to working with the government on the development, and welcomed the clarity provided for it.

Below is the full government announcement:

The State Government has announced the way forward for the Oakajee port project and associated rail infrastructure.

Planning and Infrastructure Minister Alannah MacTiernan today said the plan provided a firm way forward in the absence of the mining companies operating in the region being able to work collaboratively on the project.

"The right to construction of the port will be subject to a contestable process, limited to the two mining companies who have requested this right," Ms MacTiernan said.

"These companies can nominate in their own right or through a nominated infrastructure provider.

"WestNet Rail will be given the opportunity to develop a link into Oakajee thereby ensuring a connection between Oakajee and Geraldton ports and with all the rail in the region."

Ms MacTiernan said that the State Government would identify a corridor for the rail line connecting Jack Hills and Weld Range mines to Mullewa.

However, the Minister said that if the proponents elected to build their own rail line all the way to Oakajee, the Western Australian Government would identify a suitable corridor and co-ordinate approvals with the cost of these being borne by the proponent(s) who proceeded to build.

"The Government will consider allowing WestNet to realign their corridor with any such new corridor," Ms MacTiernan said.

"The port construction will include the breakwater, channel and turning basin and navigational aids together with the successful proponents berths and land based facilities.

"The non-successful proponent will have the right to build a subsequent berth."

Ms MacTiernan said that the criteria for selecting the successful infrastructure provider for the port would be based on:
- the capability of the port design to meet the requirements of the industrial estate and multiple rail infrastructure, including development of panamax berths;
- third party access arrangement, including price;
- the capacity to make a firm commitment to construct within an acceptable timeframe; and
- confirmation that the infrastructure provider would transfer ownership of the breakwater channel and basin to the Geraldton Port Authority. The timing of the transfer would take into account taxation and depreciation imperatives.

"While neither companies have proved up the regular deposits to reserve status, the companies want certainty in the way forward," Ms MacTiernan said.

"Again, the Government hopes that common sense will eventually prevail and the companies work together to deliver this project.

"In any event, the Government has chartered the way forward to maximise the chances of the project being implemented."