50 per cent royalty rebate incentive for magnetite producers
Colin Barnett
Premier; Minister for State Development
A magnetite royalty rebate, to be considered on a project-by-project basis, will provide a major boost for a developing Western Australian iron ore industry sector, Premier Colin Barnett announced today. Mr. Barnett was speaking after attending the opening of the State’s first producing magnetite iron ore mine, the Karara Iron Ore Project.
“Western Australia has vast magnetite resources and this ore is preferred by many Chinese steel mills,” the Premier said. “This industry has the potential to stimulate new investment and construction activity throughout the State. However, bringing magnetite ore to grades suitable for export is capital and energy intensive, so this royalty rebate will assist in recovering the massive investment required to achieve production.”
A rebate of up to 50 per cent on the full royalty rate of 5 per cent will apply for the first 12 months of magnetite production. The policy will apply for the next 3 years. There are currently 29 potential magnetite mines at different stages of planning and development in WA.
He congratulated Karara Mining Limited partners, Gindalbie Metals and the Anshan Iron and Steel Group Corporation (AnSteel), on their success. Mines and Petroleum Minister Bill Marmion said the $2.57billion Karara project located 320km north-east of Perth would produce many benefits for local communities, the region and the State over its expected 35-year life. The Minister said the project employed more than 2,400 people at peak construction and had generated 500 direct permanent jobs.
The mine will initially produce eight million tonnes per annum (mtpa) of magnetite, with the potential to expand to 16mtpa or more. The Western Australian Government worked closely with the Karara partners to secure the project, including upgrading the Pinjar to Eneabba electricity transmission line from 132kV to 330kV, and facilitating regulatory approvals.
The Premier said as the Mid-West’s largest iron ore exporter, Karara would also have a role in securing a deep water port for the region at Oakajee.