21 April 2017

BHP seeks contractors through ICN Gateway for $2Bn South Flank Iron Ore project

BHP Billiton has reached out to contractors capable of building its South Flank iron ore project after indicating that major works for the $2-billion-plus venture could begin early next year.

It is the clearest sign yet that BHP will commit to developing South Flank, earmarked as the replacement for its 80Mtpa Yandi mine that is expected to be depleted in the next 5-10 years.

South Flank is still in a study phase but BHP released an indicative timetable that would see a final investment decision in Q1 CY2018, triggering the start of a three-year build program expected to create more than 2000 construction jobs.

“As part of the study, BHP is seeking expressions of interest from suitably qualified contractors to gain an understanding of the capacity and capability of available contractors for the proposed project,” the company said on the ICN Gateway website, southflank.icn.org.au.

The company also said it had started “preliminary enabling works” that would expand accommodation facilities to house the construction workforce.

The ICN listing follows recent comments by Edgar Basto, BHP’s Asset President of WA Iron Ore, who said a more “stable” investment climate in WA had improved the chances of a go-ahead for South Flank, which is just 8km from the company’s Mining Area C operation.

“In the construction phase, a project like this could easily go well over 2000 jobs,” Basto said on the sidelines of the Annual Global Iron Ore & Steel Forecast Conference in Perth.

The project would involve establishing mining operations at South Flank and building associated infrastructure, BHP said on ICN Gateway.

This would include primary crushing facilities; overland conveyors to Mining Area C; coarse ore stockpile and ore handling plant infrastructure at Mining Area C; and upgrade to the existing stockyards and outflow facilities, the company said.

It would also involve duplicating the existing rail loop and adding a second train loadout and expansion of the Mulla Mulla Accommodation Village, BHP said.