Third party rail access would overload system, says Rio Tinto

<p>Third party access to the Pilbara’s heavy rail system would cause severe infrastructure congestion comparable to the east coast coal networks, Rio Tinto managing director of development Phil Mitchell warned yesterday (Thursday, June 7).</p> <p>Mr Mitchell told the Western Australian Transport Infrastructure Summit 2007 that an attempt to force Rio and fellow iron ore heavyweight BHP Billtion to share its rail would be detrimental to productivity.</p> <p>"I don’t think that people realise the magnitude of the cost of turning the Pilbara rail into multi-user facilities," he told the conference.</p> <p>"Once the facility is multi-user, the fundamental problems of the east coast are inevitable.</p> <p>"The issue is clearly demonstrated with the queue off Newcastle, where there are 30 to 50 to 60 vessels."</p> <p>BHP’s Port Hedland does not have surplus capacity, meaning that any disruptions, such as cyclones, typically force BHP to change its ship scheduling to compensate.</p> <p>BHP’s vice-president of iron ore, Peter Monkhouse, told the conference that there would be an enormous cost associated with third-party access.</p> <p>"We are running at maximum capacity, we cannot ship one extra tonne through our system," Mr Monkhouse said.</p> <p>"We run a very flexible system, we do not believe regulation can cope with the flexibility that we need in our system.</p> <p>"We don’t believe we’ll be properly compensated for it and we believe the system efficiency will degrade significantly with the advent of third-party access."</p> <p>The WA Government is preparing to release a state haulage regime sometime in July or August.</p> <br />