Fortescue Metals Group has approved a $US2.6 billion ($A3.6bn) magnetite iron ore project in Western Australia that will help it to increase sales of higher-grade iron ore increasingly in demand from China’s mammoth steel industry.
The Australian is reporting that Fortescue, the world’s fourth-largest iron-ore exporter, said it had agreed to advance the Iron Bridge project, forecast to produce 22 million tonnes of high-grade 67 per cent-iron magnetite concentrate annually from early next decade, with Taiwan’s Formosa Plastics Corp and China Baowu Steel Group Corp.
The partners have been studying a development of the Iron Bridge site in the Pilbara region since 2010, and built pilot and full-scale demonstration plants there between 2015 and 2018.
Fortescue has been seeking to increase the average grade of the iron ore it sells, as Chinese steel makers move away from using low grade ore, which is less efficient and has to be combined with more coal to produce a tonne of steel.
Last year, Fortescue said it would spend more than $US1 billion to construct the new Eliwana mine, also in the Pilbara region, as part of a drive to export a higher-grade of material than the 58 per cent ore it typically sells.
“When combined with the Eliwana development, (Iron Bridge) will increase Fortescue’s average product grade and provide the ability to deliver the majority of our products at greater than 60 per cent Fe, consistent with our long term goal,” said Fortescue’s chief executive Elizabeth Gaines.
Fortescue said it expects to sell its first ore from the mine in the first half of calendar year 2022, and to ramp up to full production within 12 months.