"Most of it is magnetite or low-grade hematite but, with iron ore prices at record highs and the consensus outlook for the steel-making commodity rosy, interest in the 10 members of the fledgling Yilgarn Iron Producers Association is rising fast.
The members include Nathan McMahon's Cazaly Resources, which is likely to be the first of the players outside of Cliffs to enter production, and Mindax, whose managing director Greg Bromley is also YIPA's inaugural chairman."
"WA is blessed with an abundance of iron ore but most of it is far from existing infrastructure and therefore difficult to monetise.
It is a different story in the Yilgarn area, where the iron ore proponents mainly focusing on the existing railway link from BHP's nickel mines around Leinster and the port at Esperance, which already exports Cliffs' iron ore as well as nickel concentrate from Western Areas' Forrestania mines.
Studies are under way to work out how much work needs to be done to upgrade the railway lines to handle more and heavier freight, and run links from Menzies or Leinster to the proposed mine site.
Expansion of the Esperance port is shaping as trickier, with an expectation that any increase in capacity needs to be funded by the private sector. How additional export tonnages are to be allocated remains unclear although YIPA is likely to take a leaf out of the North West Iron Ore Alliance in perhaps pursuing a single, multi-user berth strategy".
CAZ Price at posting:
34.5¢ Sentiment: Hold Disclosure: Held
