Iron ore price weakens as Australia flags return to sub-$100 prices
Futures dropped for a fourth day in Singapore, to trade about 3% lower for the week.
Image courtesy of Roy Hill.
Aussie mining billionaire Gina Rinehart’s massive Roy Hill iron ore project can finally go ahead as the company has landed a US$7.2 billion financing package from a consortium of lenders, including Australian banks.
After 18 months of negotiations, Australia’s richest person has been able to pull off a seemingly unachievable total of $10 billion, and now she is ready to continue building Australia’s largest mining construction project.
According to Roy Hill chief executive, Barry Fitzgerald, the funding deal is the biggest ever provided for a mining project in the world.
Five international export credit agencies and 19 commercial banks contributed to today’s $7.2 billion package, to be used in building a 55 million tonne a year port, a 344km railway and the mine project itself.
Rinehart and her 30% equity partners in Roy Hill, Korea’s POSCO, Japan’s Marubeni and Taiwanese steel maker China Steel Corp, have already injected over $3 billion into construction of the iron ore mine.
The project, originally expected to begin production last year, is way behind schedule. While the company last pushed it out to September 2015, industry analysts believe it is more likely to see the light by 2016. So far it is only about 30% complete.
Rinehart’s current fortune is estimated at some $17 billion, thanks to its Hancock firm, which she inherited from her father who claimed swathes of the rich Pilbara iron ore deposits in the 1950s.
