Iron Ore Processing

The question: Why when Australia is the 3rd largest exporter of iron ore in the world, are there so few companies involved in processing of iron ore?

From the FWL thread Pommie G provided this history bite of the father of FWL, MIS, MGX, MMX (ie Kingstream Steel - some got its deposits - others got its personnel eg FWL)

Kingstream Resources.
This project has failed and the following information is provided for historical interest.
An entrepreneurial group once obtained the rights to iron ore deposits in the Tallering Peak area at a very low cost for reasons of its low opportunity value. These were was cheap because of the high cost infrastructure requirement for being isolated without transport and port facilities.

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WMC gave up Tallering Peak to the government because it wasn't big for export cf Pilbara - Govt then tendered licence based on company setting out value adding venture, which Kingstream did - Tallering is 150kms from Geraldton - MGX now mine and export hematite from it

The operators believed production would be be in the "lowest quartile of world productioncosts" and therefore would be technically efficient but they faced high overhead cost penalties and so were economically inefficient.
Reflecting regional politics (National Party promoted that supports high cost regional development) the venturers obtained government assistance to offset those high infrastructure costs (to pay for the economic cost being the reason the deposits were available cheaply.

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Actually Kingstream got a super cheap deal on the gas from Epic during the time Epic thought it was going to compete with the Govt agency for a 2nd bunbury-dampier gas pipeline - a State Agreement also made the move of Kingstream from Geraldton to Oakajee in terms of site for steel plant cost-neutral - all of which means Kingstream probably was in lowest quartile but other things transpired against them

Note. The low cost nature of the deposits was made evident in April 2002 when, on failure of the venture, the deposits were acquired for just US$2.3 million by Mt Gibson Iron venturers a cost which included access to market and technology data for downstream processing valued at $12million. The Government of the state is understood to have outlaid US$3million in addition to its internal activities.
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The endeavour was evolving at a time when BHP, as a large iron ore producer deferred the second stage of their DRI iron project, and struggling to justify continued operation. There were also other steel producers intent on investing.

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Tallering was small - that was part of the problem. Kingstream also got caught up in the Asian crisis and lost its Taiwanese partner. British interests couldn't revive it - perhaps if it was happening now if may have got further. Management also had some issues.

BHP struggled with the technology of its HBI mainly because it didn't pilot the plant - however some believe it had fixed the main problems and could have made it profitable - however it was closed after the death of one of the workers.

Note Government have been right behind these ventures in one way or another - so if Govt is supportive, cost factors were OK for Kingstream - why didn't these projects move ahead?

Fact is around the world the iron ore processing industries are heavily subsidised by government (directly or through cheap power deals - power is 1/3rd costs on average). Also located increasingly in countries were labor costs are cheap. How can Australia compete??

(please add to lists below....)

Iron ore processing in Australia
BHP - various steel making
RIO - HISmelt in Kwinana
others?

Failed or not yet developed iron ore processing in Australia
BHP - HBI
MGX
MIS
Kingstream
Mineralogy