SA Mines and Energy Journal : April-May 2010
APRIL/MAY 2010 SA MINES & ENERGY JOURNAL 32 INFRASTRUCTURE Centrex Metals plans to lodge a development application for a $180 million deep-water port near Tumby Bay on Spencer Gulf before the end of the financial year. The Adelaide-based company believes the proposed port, with a bulk loading capacity of about 20 million tonnes a year, could assist the development of new mining ventures on southern Eyre Peninsula, as well as handling its own iron ore output. For some potential miners, it would provide an alternative to the proposed $600 million minerals export port at Port Bonython at the head of Spencer Gulf, with its 3km jetty, which is awaiting commitments before moving ahead. New Centrex chairman David Klingberg told shareholders in January the port plan provided "a long-term solution for many bulk mineral exporters on Eyre Peninsula" . It would also take the heat out of the debate over the use of Port Lincoln for exports of iron ore and other minerals. Mining is due to begin at Centrex's Wilgerup hematite deposit by the end of the year, and work is moving ahead for the company's Carrow and Bungalow deposits. The company has approval to export iron ore through Port Lincoln for 10 years, and work is about to start on installing a rail unloader and conveyer equipment, including a new ship loader carefully isolated from ABB's grain-handling facility. But, despite strict environmental conditions, the arrangement has caused controversy, as a potential threat to the "clean green" image of the fishing and aquaculture industries based in Port Lincoln. And the wharf is limited to handling Panamax-class ships of about 70,000 tonnes, as well as facing narrow-gauge rail constraints. Centrex is looking to establish a new port with greater shipping capacity on a coastal property it owns at Sheep Hill, 20km north of Tumby Bay. It has signed a heads-of-agreement for a joint venture with China's Wuhan Iron & Steel Corportation (WISCO) -- which has a 13 per cent equity stake in Centrex -- to develop Port Eyre at Sheep Hill. The site has a low-tide depth of 20 metres only about 500 metres offshore, enabling the proposed jetty to handle Cape- class bulk carriers of 160,000 to 240,00 tonnes. Centrex's chief operating officer, Kevin Malaxos, said the company had spent about $800,000 on studies for the proposed new direct-loading port. Preliminary engineering design has been done and current work includes wave, wind and dust monitoring to determine the best alignment for the jetty and the port facilities. Centrex's production plans are aimed at providing an initial 600,000 tonnes a year of hematite fines from the wholly- owned Wilgerup mine, which has an indicated reserve of 13.3 million tonnes, but the company has potential to increase exports from its other exploration projects in southern Eyre Peninsula. These include the new Bungalow magnetite joint venture with another Chinese company, Baotou Iron & Steel, and the Carrow magnetite and hematite project with WISCO -- part of a potential $186 million joint venture arrangement across several Centrex tenements on Eyre Peninsula. Mr Malaxos said the port project, which would require a new road and -- later -- a 37km extension from rail operator Genesee & Wyoming Australia's network at Ungarra. The port is envisaged as a stand-alone business, which would support Centrex's own operations and attract bulk export cargoes from other miners, such as IronClad Mining, with its emerging $45 million direct shipping ore (DSO) project at Wilcherry Hill, and even OneSteel, if it switched from barging ore from its Middleback Ranges mine to ore carriers standing off Whyalla. However, OneSteel is considering an expansion of its facility for Panamax sized vessels so it could potentially also cater for the import and export requirements of other miners. Operation dock and ore A deep-sea port near Tumby Bay could offer a long-term solution for bulk mineral exporters on Eyre Peninsula. Chris Milne reports. Drilling at Centrex's Bungalow deposit.