Cairn Hill Iron Ore Mine closes - Ore Train gone

 
  DalyWaters Chief Commissioner

http://www.miningaustralia.com.au/news/cairn-hill-mine-falls-victim-to-iron-ore-price-fal



The decline in the iron ore price has been blamed for a decision by the board of directors of Termite Resources to put the company into administration.


The Cairn Hill mine is located 55 kilometres south-east of Coober Pedy, and commenced production in December 2010.
Based on the projected mine life, Cairn Hill was only expected to produce until early 2015, however IMX was exploring the possibility of a Phase 2 development project which could have extended operations for another 12 to 15 months.



The SCT/SBR ore train is on its way back from the mine empty now.

Sponsored advertisement

  JimYarin Chief Commissioner

Location: Adelaide, South Australia
lets not forget the truck drivers and other mining staff at this location.
  JimYarin Chief Commissioner

Location: Adelaide, South Australia
TWO hundred jobs in the state’s much-vaunted mining sector are at risk after a mine near Coober Pedy was placed in administration this morning.


IMX Resources has placed its Cairn Hill project into administration, just two months after saying it would extend the mine’s life to the middle of next year.


It is a blow for former Mineral Resources Development Minister and now Treasurer Tom Koutsantonis, on the day he delivers his first State Budget.


IMX said in April it wanted to works towards a five-year extension of the mine, but it appears the plunging iron ore price has brought the operation to its knees.


Neither the administrator, Ferrier Hodgson, nor managing director Gary Sutherland were immediately available for comment.
The Cairn Hill Mine is 55km southeast of Coober Pedy and started production in December 2010.


http://www.adelaidenow.com.au/news/jobs-are-at-risk-as-a-mine-near-coober-pedy-is-placed-in-administration/story-fni6uok5-1226959681700
  don_dunstan Minister for Railways

Location: Adelaide proud
Iron ore is in crisis nationally (and internationally); the price has been in free-fall since late last year and the Chinese have a large surplus of steel; there are more and more projects coming on stream all the time including Gina Rinehardt's huge Roy Hill project due to be operational next year. The fact that a smaller project in South Australia is no longer viable is not surprising. Gas and coal projects are also in trouble presently because of the depressed price internationally.
  justapassenger Chief Commissioner

A competently managed company shuts down a mine the moment (even in the middle of a shift) that the price drops below the point where it breaks even - but it appears this one has been kept open past that point if the whole company has been placed in administration. That's the way it goes with the mining sector, and everyone working there knows they are taking that risk when they sign on.
  freightgate Minister for Railways

Location: Albury, New South Wales
Technically the mine has not closed as it is in administration only. There could be a future under a restructure. Time will tell.

With regard to the price dropping for iron ore I wonder what pressure this might place on Roy hill or even iron road as mentioned above ?

Coal prices are going south also perhaps just for the winter.

Could be testing times ahead for the mining industry who have been in a boom for many years.

I did read elsewhere there could be up to 100,000 jobs go in mining over the next 3 years.
  justapassenger Chief Commissioner

Technically the mine has not closed as it is in administration only. There could be a future under a restructure. Time will tell.
"freightgate"
Mines like this aren't like a car component factory continuing to operate while waiting for a bailout from Holden. When a mine stops, it stops completely - all the workers are immediately out of work and in some cases may even have to make their own way home. It may get reopened again at some point, but it's very unlikely that anyone would spend the cash on starting it up again as it was going to run out early next year anyway.

… or even iron road as mentioned above ?
"freight gate"
Iron Road is a complete joke, and nobody who is anybody will get taken in by any of their ridiculous press releases.
  JimYarin Chief Commissioner

Location: Adelaide, South Australia
http://www.railpage.com.au/news/article-14556/

this news item states iron road have signed up a 3rd party port user. who could that be and i would guess the rail lines they intend building will be connected to the artc network?
  don_dunstan Minister for Railways

Location: Adelaide proud
...

Could be testing times ahead for the mining industry who have been in a boom for many years.

I did read elsewhere there could be up to 100,000 jobs go in mining over the next 3 years.
freightgate

It's testing times for everyone at the moment - I have been reading that a lot of mines are predicated on $80 a ton and will close below that price; the price is headed towards that level in the last few weeks and is presently around the $90 mark.  Bear in mind that the price last year was mostly around the $125-35 mark so yes, that particular industry is in for tough times.

This comes despite the shipping of absolute record tonnages from Port Hedland and an equally historically huge amount of steel still being produced in China, Taiwan and Korea this year.
  SAR523 Assistant Commissioner

Location: Chicago, IL
I did read elsewhere there could be up to 100,000 jobs go in mining over the next 3 years.
freightgate

Was that based on possible mine closures or on the expected ramp down in mining employment as the sector moves from job-intensive setup mode to job-poor extraction mode?
  freightgate Minister for Railways

Location: Albury, New South Wales
That number was in the main due to labour rolling off the build phases in the sector.

I now believe there could be losses from mines where there is a high cost of production relative to the spot price.

How long might coal mines maintain a loss making scenario like many now ?
  pjknife Assistant Commissioner

Location: Port Lincoln
this news item states iron road have signed up a 3rd party port user. who could that be and i would guess the rail lines they intend building will be connected to the artc network?
JimYarin

They have stated clearly that the rail line would connect the mine near Wudinna with their proposed port at Cape Hardy, near Tumby Bay. That's a long way from any ARTC track, and why would they link up anyway if they have their own port? They are well advanced in attempting to negotiate the potential rail corridor with the affected landowners.

Cheers,
Peter
  don_dunstan Minister for Railways

Location: Adelaide proud
Iron Road is a complete joke, and nobody who is anybody will get taken in by any of their ridiculous press releases.
justapassenger

You would have to wonder who announces a huge iron ore project in the middle of a slump - what their models are predicated on etc.
  RTT_Rules Dr Beeching

Location: Dubai UAE
You would have to wonder who announces a huge iron ore project in the middle of a slump - what their models are predicated on etc.
don_dunstan

Only someone who has a strong business case. no matter how cheap your mine is to run, there always the potential there is a cheaper one somewhere else in the constant race to the bottom.

Cairn Hill is along way from port and the rail haulage costs are probably higher per km than anything in the Pilbra.
  RTT_Rules Dr Beeching

Location: Dubai UAE
Was that based on possible mine closures or on the expected ramp down in mining employment as the sector moves from job-intensive setup mode to job-poor extraction mode?
SAR523

I followed a few links from the article and ANZ bank was saying 75,000 jobs or nearly 1/3 of mining sector.

When an industry is at risk of losing 1/3 of the jobs, then the first thing that will happen is salaries start to drop in line with falling profits and closures. New jobs will get away with much lower starting salaries and if the boss really needs to cut costs, they just walk around and offer new contracts, sign here or take a redundancy and be replaced with someone on a less pay. Considering the out of control pay rises the sector has experienced, a bit of common sense is long over due.

Of course the industry is also full of work visa's and as these people get laid off, they will need to leave the country.
  bevans Site Admin

Location: Melbourne, Australia

Cairn Hill is along way from port and the rail haulage costs are probably higher per km than anything in the Pilbra.
RTT_Rules


How far was the haulage distance?  Did the train need to go through to the Port of Adelaide or was it somewhere in between?

On this train the operator did not need to maintain their own tracks.
  greasyrhys Chief Commissioner

Location: MacDonald Park, SA
How far was the haulage distance?  Did the train need to go through to the Port of Adelaide or was it somewhere in between?

On this train the operator did not need to maintain their own tracks.
"bevans"


879 kilometres between Rankin Dam & Port Adelaide (west of the Port River).
http://www.imxresources.com.au/_content/documents/1196.pdf
  justapassenger Chief Commissioner

How far was the haulage distance?  Did the train need to go through to the Port of Adelaide or was it somewhere in between?
"bevans"
Around 895km from Rankin Dam (the siding at the end of the haul road from the Cairn Hill mine) to Pelican Point.

On this train the operator did not need to maintain their own tracks.
"bevans"
That's not actually a good thing. Running it yourself and keeping it all in house is much cheaper than paying two different sets of middle men (GWA and ARTC) to do it for you. Think of all the wastage associated with that triple handling of money and contracts!

On the plus side for SCT/SBR, this train used intermodal wagons with the ore in containers rather than conventional hopper wagons. The wagons should be able to be used for other purposes, assuming that SCT/SBR owns them rather than IMX.
  Pressman Spirit of the Vine

Location: Wherever the Tin Chook or Qantas takes me
Around 890km from Rankin Dam (the siding at the end of the haul road from the Cairn Hill mine) to Port Adelaide - not sure if they went to Port Flat or Outer Harbour.
"justapassenger"

From Memory to Berth 29 (North end of Port Flat Yard)
Ore was containerised
Did the train need to go through to the Port of Adelaide or was it somewhere in between?
"bevans"

Bevans, the mine owner would determine the discharge point, not SBR.
  justapassenger Chief Commissioner

From Memory to Berth 29 (North end of Port Flat Yard)
"Pressman"

Hmm. My search seemed to imply it went to Pelican Point. All just a matter of trivia now.
  bevans Site Admin

Location: Melbourne, Australia
From Memory to Berth 29 (North end of Port Flat Yard)
Ore was containerised
Pressman


I recall taking a video of this train through Port Augusta in September 2012.  The containers were half height and were placed on flat wagons.  They had open tops.  A bit like spoil wagons.
  nscaler69 Deputy Commissioner

Location: There are no stupid questions, but there are a lot of inquisitive idiots.
SCT/SBR former ore train went to Outer Harbor/Pelican Point using mainly 40' wagons, the containers had lids on them, GWA mineral ore train is the one that uses Berth 29 Port Adelaide.
  seb2351 Chief Commissioner

Location: Sydney
SCT/SBR former ore train went to Outer Harbor/Pelican Point using mainly 40' wagons, the containers had lids on them, GWA mineral ore train is the one that uses Berth 29 Port Adelaide.
nscaler69

No lids on the SBR ore train
  bevans Site Admin

Location: Melbourne, Australia
BHP Billiton president of marketing Mike Henry says the dramatic 31 per cent fall in the iron ore price this year has not come as a surprise, and the world’s largest miner is tipping further volatility in the spot price in the months ahead.
“The decline in iron ore prices wasn’t unexpected for us ... what we’re seeing today in the marketplace is within the range of expectations that we’ve had,” Mr Henry said.
The iron ore industry has endured a rollercoaster 12 months. The final quarter of the financial year saw the commodity fall to 21-month lows at $US89 ($92), with the bulk metal plummeting by nearly a third this year.
It has recovered in the last few days to trade at $US94.70 on Thursday.


Read more: http://www.smh.com.au/business/mining-and-resources/bhp-expects-iron-ore-price-decline-over-time-20140704-zsvm8.html#ixzz36T6S67ty
  nscaler69 Deputy Commissioner

Location: There are no stupid questions, but there are a lot of inquisitive idiots.
No lids on the SBR ore train
seb2351

You are right (I always thought they did), my apologies.

Sponsored advertisement

Display from:   

Quick Reply

We've disabled Quick Reply for this thread as it was last updated more than six months ago.