Pilbara rail access ruling infuriates BHP Billiton

<p>The National Competition Council (NCC) has issued a draft recommendation that BHP Billiton’s Mount Newman railway line in the Pilbara be declared a service for the purposes of third party access.</p> <p>The council’s decision has further polarised the protagonists in the issue.</p> <p>The line’s owner, BHP Billiton, said the decision threatened stability of iron ore exports from WA, while the Fortescue Metals Group said it would unlock greater export potential in the Pilbara.</p> <p>BHP Billiton Iron Ore president Graeme Hunt said the company would be making "extensive submissions" to the NCC to point out why it believed the draft recommendation was wrong.</p> <p>The Mount Newman line was an integral part of the iron ore production process and one of the most advanced heavy haulage railways in the world, Mr Hunt said.</p> <p>It’s efficient operation had played a "crucial role" in iron ore export growth from WA, he said. </p> <p>"At a time of massive demand for Australia’s iron ore it makes absolutely no sense to be proposing to undermine one of the industries that has performed best in expanding export-related infrastructure," Mr Hunt said.</p> <p>"The potential negative impacts of declaration include delays to further expansions, increased system complexity and reduced incentive for investment, which will result in significantly higher costs for one of Australia’s most important export industries.</p> <p>"Any possible benefit from declaration of the Mt Newman line would be dwarfed by these additional costs and, based on public comments by FMG about the Mindy Mindy project, would be highly speculative."</p> <p>FMG operations executive director Graeme Rowley has implored BHP Billiton to accept the findings of the NCC’s report and prepare for commercial negotiations "in good faith" with FMG and other potential users of the line.</p> <p>"While this decision does not effect Fortescue’s firm intention to build its own railway from Anderson Point at Port Hedland to our Chichester Range deposits, it will certainly add greatly to freeing up the Pilbara’s stranded minerals resources," Mr Rowley said.</p> <p>"The BHP Billiton line runs straight past the Mindy Mindy tenement area and it makes absolute commercial sense to access this line."</p> <p>FMG said the Pilbara’s transport and logistics system in the Pilbara ought to be open to all.</p> <br />