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Macarthur Minerals (MMS) has received a key proposal regarding its planned rail link at the Lake Giles Iron Project in Western Australia.
Located in the state’s Yilgarn Region, the Lake Giles Iron Project includes the Ularring hematite and Moonshine magnetite resources.
Ularring has already been approved for development and comprises 54.5 million tonnes of indicated resource at 47.2 per cent iron and 26 million tonnes inferred resource at 45.4 per cent iron.
Through the proposal, Macarthur Minerals and Arc Infrastructure will begin developing a commercial track agreement, which will ensure sufficient rail capacity between the project and the Port of Esperance.
The agreement is an integral part of the project’s route to market, which will allow the company to ship high-grade magnetite from the remote region.
This is a significant step in the development of the site’s logistics and will help support the project’s overall feasibility study. Thus far, the company has invested approximately C$76 million into the project and released the site's Preliminary Economic Assessment Report in June of last year.
Meanwhile, Macarthur Minerals has already lodged applications with the Department of Mines, Industry, Regulation and Safety to develop a haul road and rail siding near Lake Giles.
With the applications pending and a proposed commercial track agreement underway, the company is also turning its focus to the logistics at the port itself.
This will include developing a new unloading infrastructure, to avoid the constraints of the current infrastructure at the Port of Esperance. Macarthur Minerals is also hoping to secure the rights to develop a storage shed at the port, which could store up to 300kt of iron ore.
The project has already garnered support from Western Australia’s Rail, Tram and Bus Union, as well as the state branch of the Maritime Union of Australia, suggesting workers feel confident about the long-term benefits of the project.
Cameron McCall, President and Executive Chairman of Macarthur Minerals, said Arc Infrastructure’s proposal is an important step for the project.
“The Board considers that the proposal received from Arc Infrastructure delivers the most substantial step forward for Macarthur in the last decade towards securing fully contracted train paths on the Kalgoorlie to Esperance rail line,” he added.
Cameron went on to thank the company’s shareholders for their patience and loyalty and said he was pleased to see that critical pieces of the project’s infrastructure were finally coming together.
Turning to the wider industry environment, the iron ore price has defied expectations in recent months, rising more than 30 per cent since February. However, despite the boom, Cameron was quick to caution against a short-sighted view of the iron ore market.
“Seasoned players understand that despite the current buoyancy in global iron ore prices, the memory of past commodity cycles should leave no doubt that the future of sustainable and secure employment in Western Australia’s Goldfields region must be built upon both product and customer diversity,” he said.
With that in mind, he believes the proposed project will play an important role in the region and provide a much-needed counterbalance to disruptions in the global iron ore supply chain.
At market close, Macarthur Minerals (MMS) is trading at 16 cents per share.
This article first appeared on themarketherald.com.au
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