Backed primarily by Chinese money, Perth-based unlisted public company Yilgarn Infrastructure has proposed a $2 billion rail and port development, including the construction of a new port at Oakajee, in the Mid-West.
Backed primarily by Chinese money, Perth-based unlisted public company Yilgarn Infrastructure has proposed a $2 billion rail and port development, including the construction of a new port at Oakajee, in the Mid-West.
Backed primarily by Chinese money, Perth-based unlisted public company Yilgarn Infrastructure has proposed a $2 billion rail and port development, including the construction of a new port at Oakajee, in the Mid-West.
With a completion date of 2010, the proposed infrastructure will provide regional iron ore producers with a rail route based on a regional spine from Geraldton to the Weld Range and Jack Hills areas and the Koolanoooka, Blue Hills and Mt Gibson areas. Ore will be transported back to Oakajee deepwater port, 25 kilometres north of Geraldton.
However, the proposed development is reliant on iron ore miners getting behind the project, according to Yilgarn executive director Derek Bone.
He said there had been interest in the early negations from some iron ore miners in the Mid-West.
Yilgarn chairman Dr John Saunders said 25 million tonnes of ore would be required for the infrastructure to work.
He said Yilgarn’s approach was to fund the infrastructure using 70 per cent debt and 30 per cent equity, with significant Chinese backing enabling the lowest cost debt funding for the rail and port infrastructure project.
“Low debt costs will deliver the cheapest transport tariffs for the miners and the long-term Chinese debt funding will ensure that the booming steel industry in China is locked in to the long-term viability of the project,” Dr Saunders said.
He said additional funding was close to being secured from a Western Australian entity. The company would also look towards listing next year and would seek about $250 million in its initial public offering.
The infrastructure will be open to third-party access for all miners in the region to enable expansion of existing mines and the development of new mines.
“We are continuing our detailed project planning to ensure our rail alignment and port proposals meet the objectives of the miners and the state government – that is, service the needs of all miners and the wider community in the mid west region,” Dr Saunders told WA Business News.
He said Yilgarn Infrastructure was awaiting an announcement from the state government about its proposed process to move this project forward.
Yilgarn Infrastructure’s strategic alliance consists of major shareholder China Railway Materials Commercial Corporation, while WorleyParsons Services, China National Machinery and Equipment Import and Export Corporation and China National Overseas Engineering Corporation have undertaken port and rail alignment studies.