Padbury Mining secures $6.5 billion port funding

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Image credit: flickr User: Roger

Perth-based mineral exploration company Padbury Mining Limited announced on Friday that it has secured the necessary funding to construct a new deep-water port and railway at Oakajee, Western Australia.

Image credit: flickr User: Roger
Image credit: flickr User: Roger

According to the ASX announcement issued by the company, the funding will be provided by private Australian equity investors and will be provided in three tranches.

The Oakajee project will be developed by Midwest Infrastructure Pty Ltd, which is a wholly owned subsidiary of Padbury mining. The development will enable the export of 35–45 million tonnes of iron ore, with annual exports expected to increase to over 100 million tonnes per annum over time.

Padbury will retain a 36% stake in the subsidiary developing the project, while the new unnamed equity investors will hold the remaining 64%. Further, the company has the right to claw back its shareholding to 49% “once the private investment has been returned.”

The company has been working closely with major Korean engineering firms regarding the construction process of the project that has a $6 billion budget, but hasn’t set a timeline.

Adertisement

“The Australia-Korea Free Trade Agreement recently signed by the Prime Minister, has opened the door to greater investment and trade opportunities being created between Korean and Australian companies,” it said in the announcement.

According to the company, the project will generate significant job opportunities in the Midwest and develop Western Australia and the Midwest iron ore industry.

Further, the development of the project will boost other iron ore projects to move forward into production.

“Padbury has been very focused on delivering this outcome for the past eighteen months. It has been an enormous challenge on many fronts but today’s announcement will see this game changing project finally come to fruition,” said Gary Stokes, Managing Director of Padbury.

The company acquired the intellectual property to develop the project in 2011.

“This is an exciting day for Padbury and its shareholders and fully vindicates the vision that Padbury management espoused back in 2011 when it acquired the IP,” said the company’s Executive Chairman Terry Quinn.