Milestones at Karara Mine Boost Australian Iron Ore Resource Inventory

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Researched by Industrial Info Resources (Perth, Australia)--Western Australia has established another successful iron ore project that is about to increase production to 8 million tons per annum, ending its first stage. Located 200 kilometres east of Geraldton, Western Australia, the iron ore project is being developed by Karara Mining Limited, a 50:50 joint venture between Gindalbie Metals Limited (Melbourne, Australia) (ASX:GBG) and Ansteel, one of China's largest steel producers and iron ore miners.

With an estimated lifespan of 35 years, the mine is expected to produce in excess of 30 million tons per annum. It is extracting deposits from a small-scale hematite direct shipping operation (DSO) and a larger magnetite concentrate operation.

The Karara project will be broken into three stages. Stage one is only months away from achieving the initial capacity of 8 million tons per annum of iron ore. Stage two will consist of ramping operations up to 16 million tons per annum. The associated rail and port infrastructure has been designed to handle the increased load requirements. The final stage of the operation is expected to reach the peak of its planned operational capacity.

Although some delays were encountered in the initial stages of design and engineering, the project achieved significant milestones in a relatively short period of time. This is somewhat indicative of the current Australian iron ore industry, especially that of Western Australia. By November 2009, construction had kicked off and the first direct-shipping iron ore was mined in March 2011, ramping up to 2 million tons per annum. Prior to the first overseas shipment, ore was stockpiled until the final commissioning of the port terminal in 2012. The first magnetite shipment to China was on January 1, 2013.

Karara is a prime example of activity that is occurring within the Australian resource sector, especially in the iron ore industry. Extensive efforts are required to enable projects to reach the operational stages. The isolation of many of the mines throughout the resource-rich area makes development a logistical battle. Some of the issues include housing, transport, water and power requirements.

Currently, Industrial Info is tracking 64 grassroot iron ore mine projects in the Australian metals and minerals sector with a combined investment value of $61 billion. Of this, 44 projects are located in Western Australia and account for 68% of the market share with a total investment of $49 billion.

Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, and eight offices outside of North America, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.