15 January 2014
It is estimated 1700 people are now working on Gina Rinehart’s Roy Hill project as the next phase of construction ramps up ahead of debt package deals.
The West Australian reports equity partners of the project have approved the go-ahead of the next stage of works which has seen an influx of construction workers descend on the site.
According to the paper, Samsung and major subcontractors including John Holland, BGC Contracting, Forge Group and NRW Holdings have been notified of the plan to forge ahead with the construction of the mine.
The news comes as the project continues to seek loans and finance agreements from major partners as it tries to raise $4 billion in funding from export credit agencies and an additional $3 billion from commercial banks.
In November Korean steel manufacturer POSCO announced it will offer up its 12.5 per cent share in Roy Hill Holdings as collateral for the massive Pilbara iron project in a deal worth 1.49 trillion won ($1.4 billion).
While in December the Korea Export-Import Bank agreed to offer up $1.12 billion for the mine’s development.
The US government owned Export-Import Bank also gave approval for $US694m ($737m) in financing for the project.
The Roy Hill project has awarded $3 billion worth of contracts for the development of the mine as it pushes to commence production in September 2015.
The project includes a new 55 million tonne per annum iron ore mine, 344 kilometres of railway and a new port at Port Hedland.
Roy Hill Holdings is 70 per cent-owned by Rinehart’s Hancock Prospecting. Selling off 30 per cent of the project last year, the remainder is now owned by South Korea’s Posco, Japan’s Marubeni and Taiwan’s China Steel Corporation.
Analysts predict the mine has the potential to add 7 per cent to Australian iron ore supply.
Courtesy of Australian Mining