Government to review support for Thunderbird mineral sands mine following China’s accession

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The federal government’s Northern Australia Infrastructure Facility (NAIF) said it would investigate its support for a mineral sand mine project in the Kimberley after forming a joint venture with a private Chinese company.

The NAIF has announced that it will provide a loan of $ 95 million to Australian company Sheffield Resources in 2018 to support the development of a mine between the towns of Broome and Derby in northwest Australia.

In announcing the loan, the NAIF said it would support the construction of roads and a power plant for the proposed Thunderbird mine, as well as “revitalize the port of Derby”.

“We are fulfilling the NAIF’s mandate to help drive public benefit… by funding game-changing infrastructure projects,” said Laurie Walker, CEO of NAIF.

Sheffield struggled to raise the remainder of the $ 500 million in construction costs until 2020, when a joint venture with Chinese steel producer Yansteel finalized the financing and created a new Sino-Australian joint venture at 50 / 50 named Kimberley Mineral Sands (KMS) as the new mine developer.

But the celebrations around the project’s full funding, including the revitalization of the port, were cut short when the new joint venture announced last month that it would seek permits to export all of the titanium dioxide and zircon from the sea instead. mine out of Broome.

The NAIF declined to answer specific questions from the ABC about this plan change, but provided a brief statement.

“At the end of 2020, Sheffield announced that it had obtained approval from the Foreign Investment Review Board for Yansteel, a private Chinese steel maker, to take a 50% stake in the Thunderbird mineral sands project,” the report said. communicated.

“Following the announcement, the NAIF is studying what this means for supporting the project.”

Map showing the mine site proposed by Sheffield Resources to Thunderbird.(Provided)

Always united

Despite the statement that the NAIF is investigating its support for the project and the abandonment of the Derby Port upgrades, Kimberley Mineral Sands CEO Stuart Pether said the Commonwealth entity remains supportive of the project.

“The NAIF has let us know that it strongly supports the project,” Pether said.

“They are going through a technical due diligence process, and there have been changes in the processing pattern and changes in some mining assumptions, and they are diligently following that process.”

A man in a gray shirt stands in front of a group.
Stuart Pether said Derby will benefit from the mine even if the products are exported via Broome.(ABC Kimberley: Erin Parke)

The CBA understands that far from fearing the NAIF will withdraw its support for the project, KMS is hoping the federally funded loan will more than double from $ 95 million to $ 200 million.

“The NAIF is working to ensure that the project has regional benefits… and Kimberley Mineral Sands is very confident that those benefits will outweigh any concerns about any other aspect.”

KMS will need WA government approvals to be able to export only from Broome instead of Derby.

Ports Minister Rita Saffioti was not available to be interviewed by ABC, but her office provided a statement that the decision not to export via Derby was up to the developer once he got the approvals required.

“Our opinion is that Kimberley Mineral Sands has applied to the Environmental Protection Authority for permission to export all of their mining products from Thunderbird through the Port of Broome,” the statement said.

“The final investment decision for any bulk export project will be made by the project developer.”

Federal Kimberley member Melissa Price was also not available for interview, but made a statement saying she was disappointed Derby may miss improvements at the port, but it was a business decision.

“I urge all parties affected by this possible decision to keep talking and try to find a resolution that supports a good result for Derby,” the statement said in part.

Open to negotiate

Representatives from KMS will travel to Derby later this week to deliver their message that the city still has a lot to gain from the mine even if exports go to Broome Port.

Shire chairman Geoff Haerewa said the board would listen to what the company has to offer before deciding how to proceed.

“We have decided to wait until Kimberley Mineral Sands comes to give us this explanation or presentation, explaining their reasons, and we will move forward from there,” he said.

A mining camp constructed for the proposed Thunderbird mine.
Sheffield Resources built housing for workers at the Thunderbird Mine in anticipation of raising funds for the construction of the mine itself.(Provided: Sheffield Resources)

In the meantime, Mr Haerewa said the board will do everything possible to ensure that KMS sticks to its original plan.

“We will be advocating with state and federal governments to see how they could help convince Kimberley Mineral Sands to go through Derby and adhere to their first business plan.”

Mr Pether said that while he expects it not to be the easiest meeting he has had, he hopes he can convince the city of Derby that all is not lost.

“I understand there will be some disappointment and maybe there will be anger,” he said.

“We have to develop a scenario that best suits the project, and there will always be local content, local employment.

“We will always be a drive-in-drive-out business, and there will be plenty of opportunities for Kimberley as a whole, and I’m sure there will always be plenty of benefits at Derby.”


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