DESPITE A draft recommendation in March from the National Competition Commission that railways owned by Rio Tinto and BHP Billiton should be made available for use by other train operators, Australia's federal Treasurer Peter Costello decided in May not to grant access to BHP's 295 km Mount Newman line.
The applicant is Fortescue Metals Group, which wants to exploit the Mindy Mindy ore body lying within 17 km of BHP's line to Port Hedland. Unsurprisingly, the NCC determined that it would be more efficient for BHP to share the railway rather than force FMG to build a parallel route.
Costello's stance was passive rather than active. Under the Trade Practices Act, he had 60 days to endorse the NCC recommendation. He failed to do so, and thus the status quo applied. Costello refused to comment further because the issue 'may be subject to further review processes'.
Fortescue had intended to build a branch to the mine and use its own locos and wagons to haul the ore to Port Hedland. BHP said it would be willing to contract to haul the ore for its smaller competitors, but Fortescue spokesman Julian Tapp said BHP had 'made it abundantly clear that their port facilities are not available, and the access regime as I understand it does not cover the port.'
Meanwhile, in a booming market Fortescue now plans to build its own railway and ship loading plant at Port Hedland to serve much larger iron ore bodies at Cloud Break and Christmas Creek in the Chichester Ranges - and to recoup some of the investment by sharing it with other 'junior' mining companies.