A new deepwater iron ore export port will be developed on South Australia’s Eyre Peninsula in a 50:50 joint venture between a subsidiary of Wuhan Iron and Steel Company (WISCO) and Centrex Metals.

Chinese subsidiary Wugang Australian Resources Investment (WARI) signed the arrangement with the Australian iron ore developer under the JV name Port Spencer which will be responsible for designing, building and operating the new facility which is northeast of Port Lincoln on the peninsula’s east coast.

Centrex and WISCO are already 40:60 JV partners in Eyre Iron which is developing significant magnetite iron ore mines and a processing plant west of the proposed Port Spencer site.

Centrex managing director Jim White says the new port project is a vote of confidence in WISCO’s belief of commercial multiple iron ore mine developments on the peninsula. “Eyre Iron has been on the ground exploring west of Port Spencer for the past 20 months and we now have sufficient confidence in the potential forward outcomes of that exploration and development program to parallel progress the development of an export port.

“The JV is a real stepping stone to a substantial new economic, resources and infrastructure era for southern Eyre Peninsula. It further strengthens the relationship between WISCO and Centrex in the development of magnetite iron ore mines on the Eyre Peninsula.”

The new port will allow for direct loading of ships with a capacity of up to 200,000 tonnes (or Cape-class ships) and will provide the means to market for product from the new mines.

The first task of the JV will be to prepare a bankable feasibility study for the project’s Aus$250 million first stage.

“The decision to proceed with construction will be made along with a decision on the development of a magnetite mine and magnetite concentrate processing plant. These decisions are planned to be made late this year or early next year,” Jim White says.

The Port Spencer project was given major development status by the South Australian Government in 2010. The environmental report prepared in relation to its first stage is currently on exhibit for public comment. This first phase of the project will involve construction of a facility allowing the export of hematite iron ore from Centrex’s 100%-owned and already approved Wilgerup deposit also on the Eyre Peninsula. Construction of the jetty, outloading materials handling system and ship loader, site access, establishment of onsite services, and site preparation for receival and storage facilities will all be included in the first stage works.

Stage 2 will allow for export of magnetite iron ore and be subject to further development approvals including development of a desalination plant for mine operation and port use, and magnetite iron storage and processing infrastructure. Stages 3 and 4 of Port Spencer’s expansion will depend on the growth of the Eyre peninsula resources industry. Centrex is aiming for first exports from Port Spencer by early 2015.

www.centrexmetals.com.au

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