Mount Gibson’s flagship operation, Koolan Island, doesn’t just boast Australia’s highest-grade direct shipping hematite iron ore mine.
Hemmed in by the turquoise water of the Buccaneer Archipelago off WA’s Kimberley Coast, Mount Gibson CEO Peter Kerr believes the “amazing location” also offers the best view from a mine site he has ever seen in Australia.
Speaking at the WA Mining Club on October 22, Mr Kerr said the “high grade niche mine” has ore reserves of about 18mt with a grading of about 65% Fe.
A new airstrip has been built on the central spine of the Rottnest-sized island, where ore is crushed, processed and blended as needed before shipping.
The mining fleet includes three excavators and 16 trucks while providing employment to about 450 people.
“This year we are going to process about 2mt which will be shipped directly from the island and that will increase substantially next year and even more so in the following years for our five year mine life,” Mr Kerr said.
But they were looking for opportunities for extension.
Koolan had a positive start in the September quarter with nine shipments totalling 0.7mwmt of high-grade fines at a cash cost of $66/wmt FOB.
Mr Kerr said the sharp rise in iron ore prices in recent months had been “terrific for this State during COVID”.
He said the island has a “tremendous history” including a royal visit from Queen Elizabeth, the Duke of Edinburgh and Sir Charles Court in 1963.
The mine was established by BHP more than 50 years ago before Mount Gibson acquired it through the takeover of Aztec Resources in 2007.
Mr Kerr described Mount Gibson Iron as a mid-tier, publicly listed company and the first of the “new-generation mid-west producers”, commencing exports from Geraldton in 2004.
The company has sold more than 50mt of ore through its mines at Tallering Peak and Extension Hill and now has an ASX market value of about $800 million.
“We have a good, stable team, management group and board and we have built up about $440m in cash that we sit on today, looking for growth options,” he said.
In the mid-west region, the company’s Shine Project, located about 85km north of its existing Extension Hill mine, is progressing to targeted first ore sales in mid-2021.
The project is scheduled to product 1.5mwmt a year based on stage one proven ore reserves of about 2.8mt with a grading of 59.4% iron.
The mine has a reported, measured and indicated hematite resource of 10.8mt grading at 58.2%.
“That will run for a couple of years and has the opportunity to run for another two years at a better grade of 59% but it should be a good thing for us in terms of using our infrastructure.”
Ore from Mount Gibson’s mid-west operations are exported through its established export base at Geraldton Port where the company has two storage facilities with a combined ore capacity of 360,000t.
Tallering Peak, located 175km east of Geraldton, ceased production in 2014 after producing more than 25mt of high- grade iron ore over its ten-year mine life.
