Gina Rinehart, Chris Ellison strike pact over Port Hedland iron ore berths
The iron ore billionaires have cut a peace deal over new export berths at Port Hedland, ending years of wrangling over the development.
Iron ore billionaires Gina Rinehart and Chris Ellison have cut a peace deal over the development of new export berths at Port Hedland, ending years of wrangling over development of the infrastructure.
Mineral Resources said on Monday it had reached agreement with Mrs Rinehart’s Hancock Prospecting and Roy Hill Holdings to work together to jointly develop new iron ore berths at Port Hedland, with the pair to form a formal joint venture to pursue its development.
The deal ends years of wrangling over the development of the two shipping berths in South West Creek, which sit adjacent to those built by Roy Hill for its own exports.
Space for the berths, and associated allocation through Port Hedland’s shipping channel was set aside in the last mining boom for use by Pilbara iron ore juniors.
The rights to its development were originally handed to a consortium including Atlas Iron and Brockman Mining, but sharp falls in the iron ore prices in 2012 put paid to the multi-billion development of the shipping berths, which could allow the export of another 50 million tonnes of iron ore a year from the Pilbara.
Atlas’ nominal access to the rights to the berths was one of the factors that made it a target in a pitched takeover battle in 2018, with MinRes, Fortescue Metals Group and Hancock all bidding for the then-struggling iron ore miner – despite a warning from the WA state government that the original consortium, North West Infrastructure, had lost the exclusive rights to develop the berths.
Hancock eventually won control of Atlas after lobbing a $390m cash offer for the miner, and MinRes cut an alternative development deal with Brockman, which also held some rights to the development of the berths.
Since then MinRes and Hancock have been competing for the right to build the berths, which the state government still wants to service smaller companies with stranded assets in the Pilbara.
Mr Ellison said on Monday MinRes and Hancock have now agreed to form a joint venture to develop a single South West Creek berth, potentially using Roy Hill’s existing port and rail infrastructure to transport ore to the port and load bulk carriers when it is there.
“If developed, the Project would provide MRL with a port and rail haulage solution to deliver ore mined from Mineral Resources’ deposits to Port Hedland. Haulage solutions are key to unlocking stranded assets in the Pilbara and this Agreement will provide a cost-effective solution for MRL to develop its Pilbara assets,” MinRes said on Monday.
MinRes said the two companies plan to conduct feasibility studies and present a joint case to the WA state government.