Utah Point charge discounts extended

The state government has extended its discounted charges at the Utah Point bulk handling facility by another year, to help junior miners continue exporting iron ore, as debate around the sale of the port continues.

The $2.50 per tonne port charge discount for junior operators will now expire at the end of June next year, on the condition that the ore price remains below $A80 a tonne.

The relief was due to expire at the end of the month.

Transport Minister Dean Nalder said the decision would help junior operators such as Atlas Iron and Mineral Resources preserve employment for their workers, contractors and suppliers.

“The government has had great success with the Utah Point facility," he said.

"The initiative to build the port has unlocked iron ore deposits that would have been difficult to access, enabling additional economic development in the Pilbara including thousands of jobs."

State Development Minister Bill Marmion said the state government had also decided to extend the discount to manganese exports handled at the facility to encourage the remobilisation of the nearby Woodie Woodie mine.

"We would like to see Woodie Woodie recommence operations and the extension of the discount demonstrates the government's support for remobilisation," Mr Marmion said.

Association of Mining & Exploration Companies chief executive Simon Bennison welcomed the decision, given there still has not been any definite resolution as to what fair and reasonable permanent charges at Utah Point should be.

“It is also very good news that the relief package will be extended to include manganese,” he said.

“Financial information that has recently become publicly available through treasury and Pilbara Ports Authority submissions to the Legislative Council Standing Committee on legislation reviewing the Pilbara Ports Assets (Disposal) Bill has been most useful in shedding light on the considerable profits PPA has been making on its actual investment at Utah Point.

“Even with the $2.50/t fee reduction in place, for the 2015-16 financial year, it is estimated that the PPA will make a sizeable 32 per cent return on the $235 million actually invested. 

“Despite being appreciative of the announced extension of the relief package, the users would like to see a fair and equitable long term reduction in the port fees on a permanent basis, and set at a level where a reasonable return on assets is achieved.

“AMEC urges the government to commence an urgent full review and investigation of the fees charged at Utah Point to provide a long term solution for the current and future users.”

The sale of Utah Point remains in limbo as it is still being reviewed by a parliamentary committee.