Name and Location
West Pilbara iron-ore project (WPIOP), Australia.

Client
The WPIOP is being developed by the Australian Premium Iron Joint Venture (APIJV), a 50/50 joint venture between Aquila (Baosteel 85%, Aurizon 15%) and American Metals & Coal International (AMCI), which, in turn, is 51/49 owned by AMCI and POSCO.

Project Description
The project proposes the development of a substantial iron-ore export operation for the Pilbara region of Western Australia.

Stage 1 of the project is located on pisolite iron-ore deposits, between 30 km and 85 km south-west of Pannawonica.

The first stage of development will include the construction of a 30-million-tonne-a-year mining operation and a 282 km rail network connecting the mine with the Anketell Point port. The proposed Anketell Point port will host an initial capacity of about 100-million tons a year.

Iron-ore stockpiles, as well as processing, blending and shiploading facilities, will be constructed at the port location.

It is envisaged that multiple pisolite deposits located on the western region of the Hamersley Ranges, will be mined simultaneously. There is potential for considerable growth in subsequent stages, based on the prospective and extensive tenement portfolio in the west Pilbara, as well as tenements in east Pilbara.

Value
Stage 1 of the project will require a capital investment of A$5.7-billion.

Duration
Not stated.

Latest Developments
AMCI and POSCO have joined Baosteel Resources in an infrastructure agreement with Aurizon for rail and port infrastructure to support the WPIOP in Western Australia.

The finalisation of the infrastructure framework agreement (IFA) between AMCI, POSCO and Baosteel with Aurizon creates a pathway to constructing world-class rail and port infrastructure for a new iron-ore province in the Pilbara, with exports targeted for 2017/18.

It represents the first major milestone for the WPIOP since the $1.4 billion acquisition of Aquila Resources by Baosteel and Aurizon was completed in July this year.

The first stage of the project involves the development of a new deep-water port at Anketell and a 280 kilometre railway to support at least 40-million tonnes a year throughput from eight mining areas.

The infrastructure could be expanded in the future to accommodate additional tonnage from foundation customers and other miners that do not have access to rail and port infrastructure. The Western Australian government estimates that Anketell has a potential export capacity of up to 350-million tonnes a year.

The project remains well positioned, with key Western Australian state and federal environmental approvals granted for the mine, rail and port elements of the project. Aurizon, Baosteel, AMCI and POSCO will continue to work closely with government and regulatory agencies to finalise the remaining approvals and regulatory requirements, including a Rail State Agreement and Port Lease.

Under the terms of the IFA, Baosteel, AMCI and POSCO have granted Aurizon a period of exclusivity to develop an infrastructure solution for WPIOP.  The existing minimum 12-month period of exclusivity has been extended until January 2016, subject to Aurizon delivering an acceptable base tariff (+/- 15%) by the applicable milestone date of October 2015. If Aurizon does not deliver an acceptable base tariff by this date, or a commercial agreement cannot be finalised when the exclusivity period expires, then Baosteel, AMCI and POSCO have the right to terminate the IFA and seek other options to progress the WPIOP.

Key Contracts and Suppliers
APIJV (definitive feasibility study).

On Budget and on Time?
Not stated.

Contact Details for Project Information
APIJV, tel +61 8 9423 0222, fax +61 8 9423 0233 or email project@apijv.com.
Aquila Resources, tel +61 8 9423 0111, fax +61 8 9423 0133 or email mail@aquilaresources.com.au.
AMCI, tel +203 625 9200 or fax +203 625 9231.
Baosteel, tel +86 21 2065 8888, fax +86 21 6840 4832 or email webmaster@baosteel.com.
Aurizon manager of external relations Mark Hairsine, tel +61 418 877 574.