Gindalbie finalises Karara rail agreement in Western Australia

20 November 2011 (Last Updated November 20th, 2011 18:30)

Australian iron ore miner Gindalbie Metals has finalised a A$900m (US$911m) contract with rail freight operator QR National for the transportation of up to 10Mtpa of magnetite concentrate over ten years from the Karara iron ore project, in Western Australia.

Australian iron ore miner Gindalbie Metals has finalised a A$900m (US$911m) contract with rail freight operator QR National for the transportation of up to 10Mtpa of magnetite concentrate over ten years from the Karara iron ore project, in Western Australia.

The rail haulage agreementsigned on 6 June, which will help Gindalbie to transport direct shipping ore from its Karara project from January 2012, has now become unconditional as all conditions have been finalised.

Under the agreement, QR National will also invest A$200m (US$202m) in new locomotives, wagons and upgrading administration and maintenance facilities at the Narngulu East facility, near Geraldton.

Gindalbie has also signed a A$300 (US$303m) contract with Brookfield Rail, the lease-holder and operator of the existing 200km narrow gauge rail line that runs from Morawa to Geraldton.

The deal includes upgrading the existing rail line and enhancing the capacity of Karara's stage one production of 10Mtpa and its further expansion to 16Mtpa.

Brookfield Rail has already commenced rail upgrade work that will support ramp-up of ore transport from the Karara project after it is completed in 2012.

The rail upgrade works including installation of dual-gauge sleepers corresponding to those of the Karara's 85km spur line.