Esperance Port upgrade to boost economy

It's hoped a proposed upgrade of the Esperance Port will facilitate the growth of the burgeoning Yilgarn iron ore industry and create a 'jobs bonanza' for the State's south.

An economic study commissioned by the Yilgarn Iron Producers Association has found a 10 to 12 million tonne expansion of the port would have a substantial impact not only on the Goldfields and Esperance but across the state.

The study shows the expansion would employ up to 1,000 workers during the construction phase and could generate work for more than 3000 throughout the economy.

More than 350 people could be employed yearly during mine operation as a direct result of the increased iron ore capacity.

The Transport Minister Troy Buswell has just announced the next stage of the upgrade plan, calling for private companies to register an interest in financing, designing, constructing and operating the multi-user port facility.

He says no state government funding would be allocated to the upgrade.

"I don't think there will be a need for government funding," he said.

"I mean the government have...put a lot of money in with the commonwealth to upgrading road and rail infrastructure leading into Esperance Port.

"So a lot of those transport bottlenecks are being dealt with using government money.

"My sense is that there is plenty of private interest in terms of investing in and operating that iron ore terminal." Mr Buswell says the development of the Esperance Port could be a boost for employment and mine operations in the Goldfields and Esperance.

He says the port should be able to export up to 22 million tonnes of iron ore per year once the upgrade is complete.

It currently handles about 10 million tonnes per year.

"Look in the context of a Port Hedland or a Dampier, they're not massive numbers, but they're still really important numbers because it'll keep a lot of people employed, keep a lot of mines operating and all of the servicing and transport tasks that go with that," he said.

"So in terms of economic catalyst, I think it's really important." Drought proofing the economy YIPA Chairman and the managing director of Radar Iron Jon Lea says it would 'drought-proof' the local economy, freeing up its reliance on 'turbulent' gold and nickel prices.

He says if the project is successful it would result in a boost to the WA economy from mine and port construction worth up to $550 million initially, with expected growth.

Mr Lea says wages of around $131 million during mine construction and $46 million per annum during mine operation are expected.

"$95 million in Royalties to the state government will flow, as well as significant jobs during construction and operational phases," he said.

"We now have further evidence that a modestly priced, under $200 million, Esperance Port upgrade of about 10-million-tonnes per annum capacity is the way forward.

"This project must be fast tracked and the workers and people of WA will be the winners." He says the 'modest' upgrade would include a new 750,000 tonne storage shed, twin car rail dumper, ship loader upgrade and ancillary conveyors and rail within the Port.

Mindax Limited is one of around six junior miners with undeveloped projects hoping the project moves forward.

The company last month advised that it's holding discussions with a potential partner to fast track the development of the direct shipping of ore components from its Mt Forrest Iron Project.

Mindax Managing director and CEO Steve Ward says there's been frustration at a lack of action on this issue, as the upgrade is key to boosting output from the Yilgarn Iron Province.

"Each of the YIPA members have development plans for their projects and additional capacity at Esperance is crucial for those projects to move forward," he said.

"So each YIPA member is very keen for Esperance to be expanded.

"Mindax plans to mine and export DSO [Direct Shipping Ore] iron ore in 2014 and many of our workers will be Goldfields residents." Concrete benefits Mr Ward says the recent economic impact study spells out concrete benefits to the region.

"These benefits range from stage government royalties, through to employment opportunities in construction and investment," he said.

"Much of our construction and operating costs will find their way into local pay packets and service companies." Yilgarn Province iron ore hopeful Cazaly Resources has also welcomed the recent progress.

Managing Director Clive Jones says the company hopes to begin exporting iron ore through Esperance Port within a few months.

"Cazaly's in a position where we have pretty much all the approvals to proceed with the development," he said.

"We have potential financiers lined up to fund the project we have a whole raft of contractors ready to go, so we're in a position to start pretty much straight away.

"It means that we're tightening up the timeframes for the construction of the expansion of the port of Esperance." While the miners and State Government are keen to get the project completed as soon as possible, this is a market testing exercise and what remains to be seen is what interest there is.

Applications from interested parties close on March 1, with the Government committed to selecting a preferred bidder by the end of the year.

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