Sojitz to Decide Scale Up Southdown Iron Ore Project to 10Mt/t

Sojitz Corporation started final feasibility study to develop new Southdown iron ore project in Western Australia, in which the firm has 30% interest. The firm decided to expand the annual production to 10 million tonnes level compared with former 7 million tonnes. The firm starts the production in as early as 2014 after the detailed plan including mining plan. The firm realizes more than 100 billion yen of project including pipeline for transport. The firm tries to develop the new resource when the world demand is strong in China and worldwide.

The project started the final study in June after the completion of pre-feasibility study by March. The project decided to produce annual 10 million tonnes of iron ore based on concentrate with 69% Fe level of quality after the concentration of crude ore with near 40% of Fe. The project will get required approval along with the study through September 2012 to start the construction.

The construction will take around 2 years for the mining site development including concentration plant and 150 kilometers of transport pipeline to the port. The investment could be more than US$ 1 billion while the project now estimates the value under condition change in years compared with original plan of 120 billion yen as of 2007.

The project already secured site for pellet plant in Malaysia. But the project is still studying the pellet plant investment. The project would start the concentrate shipping base in Western Australia at first before the pellet plant idea.

Sojitz acquired the interest from the joint venture partner of Grange Resources of Australia in 2007. The project was to start production as early as in 2010. But the project was delayed due to worldwide economy slump after Lehman shock.