World population growth and economies of concentrating human populations in cities is driving urbanisation and the economic uplift of populations in the developing world. The net effect of urbanisation increases the demand for steel.
Steel-making is an energy-intensive and polluting business, and the newly economically uplifted populations in steel-making countries are increasingly objecting to living in polluted environments, and expressing this concern politically, and the politicians are listening.
Easily mined quality iron ore is a finite resource, so at some time, and this varies by location, miners will need to use beneficiated leaner ores, and the best place to do the beneficiation is close to the mines. Magnetite by its nature needs beneficiation, but the end product is much sought after by steel mills.
Beneficiation requires energy, typically electricity for magnetic separators and various other forms of processing. Electricity generation requires sources of power – e.g, waterfalls, tidal flows, wind, solar, gas, coal, nuclear, and whatever. Some of these may be unsuitable, particularly if costly. Low population density where beneficiating occurs would also be a plus.
Where do many of the foregoing factors come together? Western Australia, of course.
North-west Australia has heaps of sunshine, wind and massive tidal flows, so if these can compete with its abundant supply of natural gas, that would be a plus. The area has abundant iron ore, both haematite and magnetite, and the latter definitely needs to be beneficiated, which is probably one of the reasons why Andrew Forrest intends running a gas pipeline to various mines, including Iron Bridge (which has magnetite).
The Chinese would be ecstatic if somebody offered them high-quality iron ore at prices that are a reasonable premium to lower grade ores.
