AusRAIL, Market Sectors

ERA tells Brockman and FMG to ?be grown up? about Pilbara dispute

<span class="" id="parent-fieldname-description"> Western Australia’s Economic Regulation Authority (ERA) has named a floor and ceiling cost for key sections of Fortescue Metals Group’s Pilbara railway, which junior miner Brockman Resources has been fighting to access for most of the year. </span> <p>Brockman wants to move 20mtpa of iron ore along the railway, but the junior and the giant, FMG, have been at loggerheads for some time, unable to agree on terms or pricing.</p><p>Brockman took the matter to the ERA, which last week named floor and ceiling costs on two of the key sections of FMG’s railway track – sections three and five – which falls under its subsidiary, The Pilbara Infrastructure.</p><p>Section three of the track was tagged with a floor cost of $16.15m per annum, and a ceiling cost $64.1m per annum. Section five of the track was given costs of $68.6m and $252.8m per annum, respectively.</p><p>But according to the ERA’s Lyndon Rowe, ERA intervention will not be enough for the sides to reach an agreement.</p><p>Rowe told the ABC last week that, while the ERA will appoint an arbitrator to rule within the Authority’s access price boundaries, it’s up to Brockman and FMG to “be grown up,” if an agreement is to be made.</p><p>“The Institute of Arbitrators have given us a panel of names from which we can choose to appoint an arbitrator,” Rowe was quoted by the ABC. “The arbitrator will arbitrate within those floor and ceiling costs boundaries.</p><p>“Apart from that the parties have to be grown up enough to come to their own conclusions.”</p><p>For&nbspRail Express’s&nbspdetailed analysis of the Brockman/FMG dispute, <a href="">click here</a>.</p>