MinRes starts Western Australian iron ore mine

Australian mining firm Mineral Resources (MinRes) has begun production at its 5mn t/yr Wonmunna iron ore mine in the Pilbara region of Western Australia (WA), as it seeks to boost its sales from the region to 14mn t/yr rate by the end of 2021.

Wonmunna is the first stage in MinRes' plans to increase production in the Pilbara region beyond 50mn t/yr through the construction of three hubs. Wonmunna is part of the Utah Point hub, which contains the existing Iron Valley mine and the Lamb Creek and Wedge deposits, which MinRes plans to start developing in January-June 2023 and January-June 2024 respectively.

Iron Valley shipped 2.93mn t in the six months to 3 December. The firm's Koolyanobbing mine in the Mid West region of WA shipped 4.98mn t in the same period.

Wonmunna has approvals to produce 5mn t/yr but this could be expanded to 10mn t/yr at low cost, according to MinRes.

MinRes is developing the 25mn-30mn t/yr Ashburton iron ore hub, which includes the Kumina and Bungaroo South mines. These mines will initially feed ore up to MinRes' port facilities at Port Hedland, although the firm is also looking at options to ship through the port of Ashburton.

MinRes is also awaiting approval to build two berths at Port Hedland at South West Creek, with an associated medium gauge railway connecting the 20mn t/yr Marillana mine, and possibly others in the MinRes portfolio, to the port. MinRes had planned to start developing Marillana by the end of 2020 but it is awaiting approval to build the No.3 and No.4 berths at South West Creek.

The development of these berths will add to congestion at Port Hedland, which shipped a record 540.64mn t of iron ore in 2020. The WA state government expanded the maximum capacity of Port Hedland by 7pc to 617mn t/yr in October 2019 but concerns about dust in the adjacent town have restricted throughput. All the iron ore mining firms that use the port — BHP, Fortescue, Roy Hill, Atlas Iron and MinRes — have plans to expand production over the next few years, potentially causing a bottleneck at the port in future.

MinRes ships ore of around 58-60pc Fe. Argus assessed the 58pc Fe grade at $145.85/dry metric tonne (dmt) cfr Qingdao on 19 March, down from a high of $160.75/t on 21 December but up from $97.35/dmt on 29 July. Argus also assessed the ICX 62pc Fe at $159.90/dmt cfr Qingdao on 19 March, down from $175.40/dmt on 21 December but up from $110/dmt on 29 July.

By Jo Clarke