AusRAIL, Market Sectors

Rail operators stocking up for iron ore haulage

<span class="" id="parent-fieldname-description"> The iron ore boom has contributed to the $250m worth of rail freight orders for UGL, the rolling stock and infrastructure provider said on Monday. </span> <p>Contracts with leading rail operators and resource companies that would drive "healthy expansion" for 2010/11 included:</p> <p>* A five-year locomotive service and support agreement with Rio Tinto in Western Australia</p> <p>* The supply of nine General Electric Evolution locomotives to Rio Tinto and</p> <p>* The supply of 450 locomotive bogie frames to GE, to serve the Commonwealth of Independent States markets.</p> <p>In addition, QR National’s specialist bulk freight subsidiary, ARG, has ordered six C44ACi standard gauge locomotives from UGL Rail in a deal worth more than $35m to expand its operations in the emerging Yilgarn and Mid-West regions.</p> <p>Our rail business continues to see clear signs of a recovery in sales enquiries, on the back of strengthening resources sector conditions, UGL chief executive Richard Leupen said.</p> <p><strong>Coal specialist readies for iron ore growth</strong></p> <p>Meanwhile, QR National showed similar optimism.&nbsp</p> <p>Its managing director and chief executive, Lance Hockridge, said iron ore was a strong growth area for the company as customers in WA expanded or opened mines. &nbsp</p> <p>The new locomotives are due to be delivered in the second half of 2011 to add to the WA fleet.</p> <p>AGR already operates rail services for the US-owned Cliffs Natural Resources mine at Koolyanobbing in the Goldfields, which last year exported 8mt of iron ore through Esperance, 575 km away.</p> <p>A spokesman told Rail Express this was a standard gauge route. In a $30m contract 227 new ore wagons with 23 tonne axle load targets had also been ordered.</p> <p>Cliffs is one of the 11 Yilgarn mining companies that are talking of sharing infrastructure through a series new rail spurs and exporting through Esperance.</p> <p>The projects are roughly equidistant from their alternative of Oakajee to the west, where the deepwater port and standard gauge railway system are still to be built.</p> <p>Mr Hockridge said ARG has a heads of agreement with Karara Mining to provide rail haulage services from its Karara iron ore project,&nbsp225 km east of Geraldton,&nbspwhen production begins.</p> <p>Karara Mining is a foundation customer of Oakajee Port and Rail and is due to begin production in late 2011.&nbsp</p> <p>A narrow gauge ARG customer, Mount Gibson, which exports through the port of Geraldton, is also expanding its operations, with a new mine beginning shipments next year.&nbsp</p>