Iron ore mine: Australian iron ore mine sees investment potential from India

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Underdeveloped Australian iron ore mine sees potential for investment from India and supply contracts for premium magnetite resources suitable for making green steel under second-plus commitment the world’s largest steel producer in favor of climate change, a senior company official said at an event here on Tuesday.

The Lake Giles Iron Project in Western Australia, which has iron ore resources of 66-69% Fe Fines, is seeking investment partnerships as well as supply deals for its $500 million mine development .

Formalizing strategic partnerships for the development and infrastructure needed to commercialize the Giles Lake iron project remains a key objective this year, said Richard Moon, managing director of international sales and marketing at Macarthur Minerals, the developer of the Giles Lake, during Singapore International Ferrous Week.

“The company is in active discussions with a number of global companies that have the potential to add capital and technical capabilities to the project,” Moon said, highlighting opportunities for participation from the Indian steel industry.

Moon expects 10-20% Indian investment in the $500 million Lake Giles development, which is expected to produce three to four million tonnes/year of high-grade ore, of which one to two million tonnes could be supplied to India. Green steel is made from hydrogen rather than coal and should go a long way in fighting climate change.

Lake Giles is expected to begin iron ore production from 2026.

“We plan to use a lot of renewable energy in our project, while India is expected to use hydrogen among other energy sources to make green steel,” Moon told PTI. Meanwhile, the Razorback project in South Australia, with a resource of 68.5% Fe Fines magnetite grade, is also pricing investors for its $500 million development. Razorback is in various stages of studies, including feasibility and final investment decisions, with production expected to begin from 2025.

“We are entering the early stages of financing our project and are seeking strategic partners in Australia’s high-grade magnetite resources,” said Stephen Weir, CEO of Magnetite Mines Ltd, owner of the project with a 4-year resource. 2 billion tonnes from two very large magnetite iron ore deposits.

The direct iron reduction (DRI) process and the use of energy such as hydrogen can turn magnetite ore into green steel, according to Weir, who noted India’s long-term plans to produce green steel.

Traders see potential for Indian investment in the two mega mines, each fetching $50-100m, or 10-20%, but tied to supplying magnetite ore contracts at competitive prices. India’s highest ore grade is 64% Fe Fines, and imports of 66-69% Fe Fines will help make better quality, eco-friendly steel, traders say at the opening of the conference on Tuesday.

Although owners of iron ore resources don’t give much clearer guidance on investors, given the uncertainty created by the war between Ukraine and Russia, traders said it would make sense to attract investors from North Asia and India, where factories are modernizing to produce in an ecological manner. friendly products.

Logically, China and India would be the big long-term buyers of premium iron ore, although all are watching the impact of the war between Ukraine and Russia on world prices, traders said.

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