Photo by: Reuters
PERTH (miningweekly.com) – Despite the iron-ore prices falling to historical lows in recent times, iron-ore developer Roy Hill was confident that its A$10-billion namesake project, in Western Australia, remained viable.
“We currently have committed long-term sales contracts with major steel mill customers in China, Japan, Korea and Taiwan. These agreements account for more than 80% of production, equating to more than 45-million tonnes a year,” said Roy Hill CEO Barry Fitzgerald at a conference in China.
“The security of supply we have through the life-of-mine offtake agreements with our equity partners plus the long-term agreements we have signed with other parties helps insulate us from potential fluctuations in the market,” Fitzgerald said.
The operation will produce 55-million tons a year, over a life-of-mine of more than 20 years. The mine will involve a fleet of 18 haul trucks and two excavators.
Roy Hill was expected to produce its first product by September next year.
“More than 600 000 t of ore has been stockpiled and material movement from both our own mining fleet and that of the mining contractor is continuing to ramp up,” Fitzgerald said, adding that the project was on track and on budget.
Meanwhile, Fitzgerald noted that Roy Hill was focused on margin and delivering stable, consistent quality rather than tonnes.
“Because we are restricted by the allocated export capacity through the Port of Port Hedland, as a business we have always focused on rigorous cost management and business improvement through the application of technology and innovation across the business. By doing so, we remain in a good position to effectively manage the cyclical nature of the industry, while maximising returns for our shareholders.
“We are establishing a company where innovation in terms of both a technology and thinking viewpoint are key drivers in delivering operational efficiencies, which will strengthen our position as a leader in the industry from a production and performance perspective.”