Iron Road Ltd

Iron Road Ltd
ISIN AU000000IRD4 (ASX:IRD)
Industry Mining and metals
Founded 2008 (2008) in Perth, Western Australia
Founder Andrew J Stocks
Headquarters Adelaide, South Australia
Area served
 Eyre Peninsula, South Australia
Key people
  • Peter Cassidy (Chairman); Andrew J. Stocks (Managing Director)
Total equity AUD 129,456,908 (2017)
Parent The Sentient Group (73.73% of issued ordinary shares)
Website http://www.ironroadlimited.com.au
Footnotes / references
Source: Iron Road Ltd annual report 2017[1]


Iron Road Ltd is an Australian iron ore exploration and mining company, listed on the Australian Securities Exchange (ASX:IRD) in Perth, Western Australia in 2008. Its objective is to develop a world class magnetite mine and infrastructure in South Australia.[1]:24 It has two projects, both in South Australia: the Central Eyre Iron Project, and the Gawler Iron Project, currently in abeyance. The company's corporate office is in Adelaide.

The parent entity of the Group and the ultimate parent entity and controlling party is The Sentient Group (incorporated in the Cayman Islands), which at 30 June 2017 owned 73.73% of the issued ordinary shares of Iron Road Ltd.[1]:40 The largest shareholder of quoted ordinary shares is HSBC Custody Nominees Australia Limited (84.23%).[1]:55

Approvals for the main project

In August 2013 the South Australian Government declared the Central Eyre Iron Project as a Major Development — a category applying to developments of major economic, social or environmental importance to the state.[2]

In September 2016 the Australian Government statutory authority, Infrastructure Australia, placed the Central Eyre Iron Project rail and port infrastructure on the national Infrastructure Priority List, which has a total of ten projects on it. The project was also the only ‘Opportunity for Growth’ project in Australia.[1]:4

In May 2017 the South Australian Government granted a 21-year Mining Lease for magnetite mining and minerals processing[1]:4, with 127 compliance conditions flagged.[3] In that month the South Australian Government also gave statutory development authorisation for the proposed port development, utilities corridor and worker village.[4]

Approval under the federal Environment Protection and Biodiversity Conservation Act in relation to the proposed Cape Hardy port, the only remaining primary approval needed from government, was granted on 9 March 2018.[5][6]

Financing and project partnerships

In April 2017 Iron Road Ltd obtained Expressions of Interest from the China Development Bank, the Industrial and Commercial Bank of China, and the China Construction Bank — the latter two being the world’s largest and second largest banks respectively — for project debt financing.[1]:25

The company has signed memoranda of understanding for iron ore offtake with five major Chinese steel mills, including its project partner, Shandong Iron and Steel Group (ShanSteel).[5]

Infrastructure for the Central Eyre Iron Project is expected to be built by Iron Road Ltd's construction partner, the China Railway Group Limited (CREC), which is a consumer of steel and the largest infrastructure construction contractor in the world. It recently completed construction of the 2,000 kilometres (1,200 mi) US$5 billion Qinghai-Tibet Railway.[5]

Central Eyre Iron Project

Map showing location of the Central Eyre Iron Project iron ore prospect (red), Cape Hardy, and the utilities corridor between them.[7]

The Central Eyre Iron Project, on the Eyre Peninsula, is based on three iron occurrences (Warramboo, Kopi and Hambidge) immediately to the east of the small township of Warramboo (33°14′34″S 135°35′39″E / 33.24289°S 135.59403°E / -33.24289; 135.59403), on the Tod Highway 25 kilometres (16 mi) south of the regional centre of Wudinna.[8]

The project has been predicted to become South Australia's largest mining project since the Olympic Dam mine and the largest mine developed in the state's agricultural belt. [8] The mine is anticipated to become an open pit 7 kilometres (4.3 mi) long and 4 kilometres (2.5 mi) at its widest. The ore reserve is 3.681 billion tonnes @ 15.07% Fe, producing a concentrate grade of approximately 66.7% Fe.[5]

Iron Road Ltd has stated that it will produce a high quality, low impurity iron concentrate that will serve as a clean, superior blending product for steel manufacturers, and that an output of 24 million tonnes per annum of approximately 67 per cent iron concentrate is planned over almost 30 years. Further, the company considers that with a competitive projected operating cost its iron concentrate is well positioned to actively displace lower quality iron ores as steel makers increasingly focus on high quality, low impurity feedstocks.[1]:6

Construction costs and schedule risk are expected to be reduced significantly by building the processing plant as large self-contained modules in China and commissioning them before being transported to Australia.[9]

The company has flagged its concern that a high proportion of power generation sourced from renewable generation without adequate redundancy planning has undermined energy security in South Australia, reducing competiveness of existing industries and raising new investment hurdles. It has stated that it is working through independent and grid based solutions with government and industry.[10]

Proposed deep water port at Cape Hardy

The company has acquired land for a new deep water port at Cape Hardy on the western shore of Spencer Gulf, 7 kilometres (4.3 mi) south of Port Neill and 30 kilometres (19 mi) north-east of the regional centre of Tumby Bay. It would be the first deep water port in South Australia.[1]:5 A 1.3 kilometres (0.81 mi) jetty, capable of handling different commodities, would have two iron ore berths, each capable of accommodating the largest dry bulk cargo vessels (Capesize).[1]:4 The planned ship loader capacity would be 70 million tonnes per annum.[5] An additional capacity of 50 million tonnes per annum would be available for third party users.[11]

Utilities corridor and heavy haul railway

Iron Road Ltd's plans include a 148 kilometres (92 mi) utilities corridor from Warramboo to Cape Hardy in which would be a substantial standard gauge heavy haul railway, service road, power line and water pipeline.[5]

Unit trains are planned to consist of two locomotives hauling 145 bottom-dump cars each holding 78 tonnes of ore. The round trip would be 9.3 hours; there would be a total of six return trips per day. A balloon loop would be at both ends of the line, eliminating the need to shunt locomotives. The axle load rating would be 25 tonnes (25 long tons; 28 short tons) and maximum grades about 0.5 degree (about 1 in 115).[9]

Grain transportation assessment

Iron Road Ltd and Emerald Grain, a major grain marketing and supply chain company wholly owned by Sumitomo Corporation, have been assessing opportunities to use the planned rail and port infrastructure to export grain. State government primary approvals of this capability have been encompassed by the port and infrastructure approvals issued in May 2017; secondary approvals are pending.[5]

The planned railway line would penetrate into the grain growing areas of the peninsula, and the company considers growers "will appreciate an alternative modern and efficient export route for their grains, and above all we bring choice". Currently more than 80 per cent of peninsula grain production is exported through Port Lincoln. [5]

Gawler Iron Project

The company estimates that its Gawler Iron Project has mineralisation capable of supporting a small to medium scale magnetite iron ore mining operation of 1–2 million tonnes per annum with the potential to produce a quality iron concentrate using a simple beneficiation process. The 3,380 square kilometres (1,310 sq mi) project area is about 270 kilometres (170 mi) north-west of the Central Eyre Iron Project; its southern boundary is about 25 kilometres (16 mi) north of the Trans-Australian Railway and about 80 kilometres (50 mi) west-northwest of the railway junction town of Tarcoola. A scoping study was completed in 2013. Iron Road Ltd has stated that it has conducted little evaluation activity recently since it is focusing "all effort" on its Central Eyre Iron Project.[12][13]


References

  1. 1 2 3 4 5 6 7 8 9 10 Iron Road annual report 2017. Adelaide: Iron Road Limited. 30 June 2017.
  2. ↑ "Central Eyre Iron Project" (PDF). SA Planning Portal. South Australian Government Department of Planning, Transport and Infrastructure. 2017. Retrieved 26 October 2017.
  3. ↑ "Iron Road project approved for South Australia's Eyre Peninsula". ABC News. 3 May 2017. Retrieved 20 June 2017.
  4. ↑ "Major developments in SA". SA Planning Portal. South Australian Government Department of Planning, Transport and Infrastructure. 2017. Retrieved 26 October 2017.
  5. 1 2 3 4 5 6 7 8 Stocks, Andrew (23 May 2017). "Iron Road presentation to SA Resources & Energy Investment Conference 2017". Iron Road. Iron Road Ltd. Retrieved 25 October 2017.
  6. ↑ "EPBC approval received". Iron Road. Iron Road Ltd. 2017. Retrieved 15 June 2018.
  7. ↑ "Central Eyre Iron Project". SA Planning Portal. South Australian Government Department of Planning, Transport and Infrastructure. May 2017. Retrieved 27 October 2017.
  8. 1 2 Austin, Nigel "Iron Road, the mine that could change our future" The Advertiser, 11 February 2013.
  9. 1 2 "Iron Road - Definitive Feasibility Study Presentation". Iron Road. Iron Road Ltd. 16 March 2014. Retrieved 26 October 2017.
  10. ↑ Stocks, Andrew (18 November 2016). "Annual General Meeting: Managing Director's presentation". Iron Road. Iron Road Ltd. Retrieved 25 October 2017.
  11. ↑ "Central Eyre Iron Project (CEIP)". Iron Road. Iron Road Ltd. 2017. Retrieved 26 October 2017.
  12. ↑ Stocks, Andrew (30 June 2017). Iron Road annual report 2017: Managing Director's report. Adelaide: Iron Road Ltd. p. 10.
  13. ↑ "Gawler Iron Project". Iron Road. Iron Road Ltd. Retrieved 24 October 2017.
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