Fortescue OKs $2.6B expansion of Iron Bridge magnetite project
Australian iron ore producer Fortescue Metals Group (ASX:FMG) has given the green light to the $2.6 billion expansion of its Iron Bridge magnetite project in the Pilbara, Western Australia. This is the second major mine development that Fortescue is carrying out in less than a year.
The world’s No. 4 iron ore miner said the mine, in which Taiwan’s Formosa and China’s Baosteel Resources also hold a stake, is expected to produce 22 million tonnes a year of 67% iron magnetite concentrate by mid-2022 — at a fraction of the relative capital cost of other high-profile magnetite projects in Western Australia.
The announcement follows Fortescue’s commitment to build the $1.3 billion Eliwana mine last year — taking the total expansion investment to more than A$5 billion (about $3.5 billion).
“The project is well progressed and ready for detailed design and execution with the majority of key approvals already in place. The innovative design, including the use of a dry crushing and grinding circuit, will deliver an industry-leading energy efficient operation with globally competitive capital intensity and operating costs,” chief executive Elizabeth Gaines said in a statement.
“Our focus has been to create the most energy and cost-efficient ore processing facility, tailored to the specific ore we will mine,” she added.
Iron Bridge is expected to provide jobs for about 3,000 people during construction, and 900 full-time positions once operations start.
This stage of development will include an ore processing facility, an airstrip and expanded village, a 195km Canning Basin water pipeline and a 135km concentrate pipeline to Fortescue’s Herb Elliot port facility in Port Hedland.
In a separate statement, the company updated Iron Bridge’s magnetite mineral resource estimate, with ore reserves climbing up to 716 million tonnes on June 2018’s 705 million tonnes.
“This update supports the development of stage two of our Iron Bridge magnetite project announced today, which holds Australia’s largest JORC compliant magnetite resource,” Gaines said.
Fortescue, which will operate Iron Bridge, has already secured binding off-take agreement for 5.3 million tonnes a year with five different steel makers.
When combined with ore from the company’s Eliwana mine, currently under construction, Iron Bridge is expected to increase Fortescue’s product grade and give it the option of delivering the majority of its products at greater than 60% iron.