Fortescue outlines long-term dream of 200mtpa exports

<p>Fortescue Metals Group would look to raise another $1bn to speed up and expand its iron ore export production from 2009, the company confirmed yesterday (Monday, June 18).</p> <p>Already aiming for a 45mtpa export program starting in May 2008, Fortescue said it now wanted to increase that to 60mtpa and ultimately 200mtpa on the basis that there was sufficient demand in the market.</p> <p>Mining giants BHP Billiton and Rio Tinto are presently shipping about 230m tonnes between them and have plans to rapidly increase production to 375mtpa by 2010.</p> <p>Should Fortescue reach its 200mtpa target within the undisclosed timeframe, it would rival BHP Billiton for output from the Pilbara.</p> <p>Fortescue is developing a $2.7bn mine, rail and port infrastructure, allowing the company to charge junior miners for any available capacity that it does not use.</p> <p>Fortescue shares went into a trading halt on the Australian Stock Exchange on Friday in the lead-up to yesterday’s announcement.</p> <p>The company now has less than 300 days to turn its &#8220impossible dream&#8221 into reality, and is relying on what executive director Graeme Rowley sees as iron ore demand that cannot be ignored.</p> <p>The move comes with a great deal of risk, including the need to convince bondholders that the rapid expansion will not compromise their existing investment.</p> <p>The plan also needs a series of environmental and government approvals.</p> <p>Fortescue has given few details of how it plans to go about ramping up its capabilities to such a size, choosing instead to appoint Citi (formerly known as Citigroup) and JPMorgan to advise the company on the best path.</p> <p>The Western Australian Government said earlier this year that there could be demand for up to 900m tonnes of iron ore from the Pilbara by 2025.</p> <br />