Iron Road Limited

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]

In April 2017 Iron Road Limited 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 planned to be built by Iron Road Limited's construction partner, the China Railway Group Limited (CREC), a consumer of steel and the largest infrastructure construction contractor in the world, with completed projects including the 2,000 kilometres (1,200 mi) US$5 billion Qinghai-Tibet Railway.[5] Iron Road's Interim Report of the Half Year Ended 31 December 2018, however, stated: "Despite ongoing contact with China Railway Group (CREC), the rate of progress has been unacceptable and as a consequence the Company reinvigorated introductions and discussions with various parties that potentially have an interest in the Company, the CEIP or select components of the CEIP".[7]

Map showing location of the Central Eyre Iron Project iron ore prospect (red), Cape Hardy, and the utilities corridor between them.[8]

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), on the Tod Highway 25 kilometres (16 mi) south of the regional centre of Wudinna.[9]

In 2017 Iron Road Limited predicted that the project would become South Australia's largest mining project since the Olympic Dam mine and the largest mine developed in the state's agricultural belt.[9] The mine was anticipated at that time to become an open pit 7 kilometres (4.3 mi) long and 4 kilometres (2.5 mi) at its widest. The ore reserve was stated to be 3.681 billion tonnes @ 15.07% Fe, producing a concentrate grade of approximately 66.7% Fe.[5]

The company stated that it would produce a high quality, low impurity iron concentrate that would 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 was planned over almost 30 years. Further, the company considered that with a competitive projected operating cost its iron concentrate was 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 were 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.[10]

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 competitiveness 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.[11]

In January 2019, Iron Road announced, reportedly in a bid to attract further investment, that it had halved the CEIP's target output to 12 million tonnes of ore per year (dry), including pre-strip, and halved the mine cost to US$645 million over an initial 22 year ore production mine life. Total project capital requirements would be reduced from US$4.00 billion to US$1.74 billion. Energy consumption would drop by 66 per cent with mean project power demand dropping to 212MW. These figures were exclusive of the cost of the railway and port, which was to be regarded as a separate project.[12][13]

Iron Road Limited and Emerald Grain, a major grain marketing and supply chain company wholly owned by Sumitomo Corporation, assessed the opportunities to use the planned rail and port infrastructure to export grain. Managing Director Andrew Stocks stated in his presentation to the SA Resources & Energy Investment Conference in 2017 that state government primary approvals of this capability had been encompassed by port and infrastructure approvals issued in May 2017, and that secondary approvals were pending. The railway line was envisaged to penetrate into the grain growing areas of the peninsula, the company considering that growers would "appreciate an alternative modern and efficient export route for their grains, and above all we bring choice". [5] Since the company’s abandonment of rail in the infrastructure corridor, no announcement has been made.

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 Limited has stated that it has conducted little evaluation activity recently since it is focusing "all effort" on its Central Eyre Iron Project.[17][18]

• Iron Road website