Aurizon posts increase in profit, earnings with limited COVID impact

Aurizon has increased its earnings before interest and tax (EBIT) by 10 per cent on the previous year’s results and a 12 per cent increase in profit.

This improvement was largely driven by increased earnings from Aurizon’s managing of the Central Queensland Coal Network (CQCN) and strong performance of the company’s bulk business.

These results include the impact of COVID-19 on the business, which managing director and CEO Andrew Harding said had limited impact.

“Despite the emergence of COVID-19 in the second half of FY2020, the Company has delivered a solid operational and financial performance with no material impact as a result of the pandemic,” said Harding.

With much of Aurizon’s business involving the haulage of metallurgical coal, consistent steel production in China and a rebound of steel production in India in May and June helped the freight operator through the COVID-19 period. In addition, a drop in US metallurgical coal exports contributed.

In Aurizon’s coal business, it added new customers including Peabody and Bluescope and added volume in the contract with Coronado.

On the bulk side of the business, Aurizon added contracts with BGC for cement products from Kalgoorlie. Aurizon extended its contracts with South32 Cannington and Incitec Pivot, both on the Mt Isa corridor. Aurizon began the operation and maintenance of a ballast cleaning machine for Rio Tinto in the Pilbara and there was an increase in demand from Mineral Resources. These led to a 21 per cent increase in revenue from bulk operations.

In Aurizon’s management of the CQCN there was a shortfall of volume. Volumes are expected to be lower in the next year due to COVID-19.

Aurizon also reported on its safety record over the 2019-2020 financial year. While there was a 10 per cent improvement in the total recordable injury frequency rate, there was an 8 per cent deterioration in rail process safety performance.

BHP keeps rail services moving

BHP’s rail workforce are changing the way they work to respond to the coronavirus (COVID-19) and ensure that the network continues to operate.

As a number of train drivers are based interstate and overseas, some have opted to stay in the Pilbara. Those who have relocated to Western Australia are undergoing 14 days of self-isolation before they return to work.

Additionally, rail operations staff including supervisors, coordinators, trainers and other team members are helping out in roles they may not normally fill to ensure the trains keep running. Overall, however, most of BHP’s rail operations team live in WA.

“With the current challenge in front of us, the team are doing whatever it takes to help each other out and keep our trains moving,” said rail operations manager Steve Campbell.

“The Rail drivers here at BHP are some of the best in the world.  They are proud of what they do and who they represent.  I am so proud of the entire rail team who have all been up to the challenge, keeping our trains moving, helping to keep the country moving – to me, that’s big!”

BHP operates two main railways in WA to support its iron ore mining in the Pilbara region. The rail lines travel from Newman to Nelson Point and Yarrie to Finucane Island, both of which are located in the Port Hedland harbour. The 634 kilometres of rail line are supported by a number of spurs, loops, and marshalling yards.

Monadelphous purchases a major rail infrastructure provider

Monadelphous has announced they’ve purchased a rail infrastructure maintenance service provider based in New South Wales.

The Australian engineering group have acquired the business and assets of Harbinger Infrastructure.

Monadelphous will also takeover the engagement of their operational team and NSW-based rail maintenance contracts.   

Through this acquisition, Monadelphous will expand their rail maintenance support and service offering into NSW, and other east coast regions. 

The Perth based organisation provides large-scale multidisciplinary project management and construction services, sustaining capital works, and services for public sector infrastructure and facilities.

Monadelphous secured new contracts and additional work valued at approximately $1.35 billion since the beginning of the 2019 financial year.

Harbinger Infrastructure stated in a social media post on January 9 that they’re pleased with the acquisition.

“Monadelphous, which has more than 45 years’ experience in the mining and oil and gas sectors, commenced providing rail infrastructure and rolling stock maintenance support services in the Pilbara region of Western Australia in 2017,” they said.

Monadelphous Managing Director Rob Velletri said in the company’s 2019 annual report that there will be ongoing growth and diversification of the business into the infrastructure sector.

“Maintenance activity in the resources market is expected to be strong as production levels in Australia remain at record levels,” he said.

“Customer focus on optimising production and increasing productivity levels will continue to drive demand for ongoing maintenance support and sustaining capital work.”

BHP proposal approval lays out 100-year plan for the Pilbara

Western Australia’s McGowan Government has approved mining giant BHP’s plans for expansion in the Pilbara region, which includes plans for the company’s freight rail operations.

BHP’s plan lays out a strategic mining proposal for the next 50 to 100 years in the region, including mining, rail, storage, dams and associated infrastructure, with a plan to halve future approval timeframes. 

BHP is a freight operator on the Mt Newman and Goldsworthy railways, which run from the town of Port Hedland in the northern Pilbara.

The WA Environmental Protection Authority (EPA) has also recommended BHP’s plan, subject to certain conditions. Particularly crucial to the EPA’s assessment was that BHP’s plan not significantly impact important regions such as Karijini National Park and Fortescue Marsh.

“The EPA gave BHP’s strategic proposal careful consideration, including considering the impacts to fauna, flora, surface and groundwater, air quality, landforms and social surrounds,” said WA Environment Minister Stephen Dawson. 

“Strategic proposals allow the EPA to take a bigger picture view of the potential environmental impacts the proposals may have, considering the cumulative impacts rather than on a case-by-case basis, as individual mines or developments are proposed.”

The WA Government added that the proposal would help to reduce red tape and green tape, allowing the EPA to assess the cumulative effect of future proposals rather than on a case-by-case basis.

“Industry has been crying out for this type of plan. It recognises the need to reduce unnecessary ‘green tape’ to increase investor confidence, and pave the way for more jobs,” said WA Premier Mark McGowan.

“It is another sign our economy is improving with the major miner taking a long-term view of its proposals in the State.