Fortescue push for 'Pilbara Port Authority'

Fortescue Metals managing director Andrew Forrest held open the prospect of building more ports in the iron ore-rich Pilbara and backed the idea of a Pilbara Port Authority (PPA), when officially celebrating "first ore on ship" at Port Hedland yesterday.

At an event attended by the likes of moguls James Packer and Kerry Stokes and Western Australian premier Alan Carpenter, the company began loading more than 170,000 tonnes of high quality "rocket" iron ore aboard the 174,145 dwt capesize Heng Shan .

The loading followed a test run last week on the 73,990 dwt panamax bulker Blumenau , which Equasis records as being owned by Nissen Kaiun/Southern Ocean.

Of the company's Herb Elliot Port terminal and the chances of Fortescue replicating it, Mr Forrest told Lloyd's List DCN : "Those two wharves, Australia can bank.

"Whether or not we then go and build a third fourth, fifth and sixth is really dependent on the opportunities of how we can expand this project in co-operation with community and the market.

"We are also looking at port opportunities across the Pilbara because our ore bodies extend right across the Pilbara.

"And while the market needs us and the Pilbara workforce needs us, we will continue to grow this company and the infrastructure opportunities that arise from it."

He stressed that WA was starved of access to deep-water ports.

Baosteel, China's biggest steel producer and Fortescue's largest customer, had signed a long-term, 10m-tonne-a-year (mpta) supply contract which would be increased by an additional 10 mtpa once production increased beyond 55mtpa, Fortescue said.

All top 10 Chinese steel mills had signed supply contracts.

On the PPA, Mr Forrest said: "I actually think the Pilbara Port Authority would be a very good thing for the Pilbara.

"It would lead to much greater efficiencies and synergies. It would enable the Pilbara ports to speak with one voice internationally and I think that would be be good for the state and good for the country and certainly any company which wasn't supporting it wouldn't have taken those other two factors into account in their opposition."

Regarding a possible merger between BHP Billiton and Rio Tinto, he said Fortescue would "wait and see" but would consider approaching competition authorities if barriers to doing its business were raised any higher.

If mining companies in the state co-operated and shared port and rail infrastructure, "we'd compete as a country much more competitively".

With two MoUs signed with junior miners, Mr Forest said Fortescue would look to transport their product but could not say when.

He would not comment on speculation of Chinese take-over interest but welcomed Chinese investment.

"Fortescue is Australian-born and bred and I think it will always be an Australian-controlled company," he said.

Ironically, given recent history, the Heng Shan , which translates as "everlasting mountain", was chartered by Fortescue's arch-rival, BHP Billiton, last July, at a reported rate of US$94,500 a day.

Lloyd's List in London reported this week that Fortescue had fixed the 173,880 dwt capsize Jin Tai for US$160,000 daily.

Doubling the irony, sources said she had been charted presently by Taiwan Maritime Transport subsidiary TMT Bulk, at an unknown rate, to deliver cargo to China's Baosteel.

Charter costs have since increased even further.