FMG says no spare capacity

<span class="" id="parent-fieldname-description"> The plight of iron ore juniors in the Pilbara to secure rail access to haul their ore took a turn for the worst last week, with Fortescue Metals Group making it crystal clear in a submission to Western Australia’s Economic Regulation Authority that it’s not prepared to share its railway with Brockman Mining. </span> <p>In a written submission to the ERA, Fortescue said Brockman’s proposal to use its railway to transport its iron ore should be rejected because Fortescue would have no spare capacity.</p><p>“As Fortescue is utilising all the capacity of TPI’s railway, unless there is further expansion beyond Fortescue’s planned expansions, there is no capacity available to Brockman,” Fortescue said in its submission.</p><p>This is despite TPI’s planned expansion from 133 million tonnes to 155 million tonnes a year by the second quarter of 2014 financial year. Fortescue claims the extra capacity would be fully utilised by the company and its joint venture partner, BC Iron.</p><p>Fortescue’s submission reportedly said that Brockman’s trains on TPI’s railway would lead to inefficiencies, lost iron ore sales, and reduce royalty payments to the WA Government.</p><p>Brockman launched its request to the ERA back in May, and is seeking to transport up to 20 million tonnes of iron ore a year from late 2016 from its proposed Marillana project on a 196km section of TPI’s railway line.</p><p>Brockman’s access request comes as Fortescue weighs up selling a minority stake in TPI’s assets – worth a reported $3bn – to help shore up its debt-laden balance sheet amid volatile iron prices. A decision on the sale is expected by September.</p><p>Brockman however, is not pinning all of its hopes on accessing Fortescue’s railway, with the miner and Aurizon last week announcing a three-year agreement to develop and operate rail and port infrastructure for the Marillana and Ophthalmia iron ore projects.</p><p>Brockman also signed an MoU with Flinders Mines for both companies to cooperate on infrastructure in the Pilbara.<br />&nbsp</p>