Rinehart’s Atlas Iron reports earnings dip
Article by Simon Grogan courtesy of the Business News.
Atlas Iron has joined Mineral Resources in pointing to congestion issues at Utah Point as the reason for lower iron ore shipments, and aired grievances about approval delays.
The private mining company, which operates the Mt Webber, Sanjiv Ridge and Miralga mines iron ore mines in Western Australia’s Pilbara region, hit a production target of 10 million wet metric tonnes of iron ore for the 2023 financial year.
But mining efficiencies did not translate to stronger shipments, with exports hitting 8.9 million wmt for the period due to what chief executive Gerhard Veldsman said had been constraints at the Utah Point multi-user facility.
ASX-listed iron ore and lithium miner Mineral Resources, which uses the same port, reported similar issues in handing down its quarterly report this week.
A largely productive quarter for the company across iron ore and lithium was marred in-part by congestion at the port.
Combined with lower iron ore prices, Atlas Iron revenue fell by 9 per cent to 1.2 billion for the 12 months and earnings before tax declined from $467 million to $427 million.
Mr Veldsman was upbeat despite the earnings slip.
“There were some external challenges outside our control, such as shipping constraints at the Utah Point multi-user facility that impacted us, but we were flexible in responding to those challenges and importantly, we improved productivity and safety,” he said.
In her results commentary, Hancock Prospecting chairman Gina Rinehart took a swipe at what she said were ‘multi-layers of red tape’ as the company seeks to develop its new McPhee Creek mine.
The $605 million project is currently before the state’s Environmental Protection Authority and was recommended for approval by the watchdog earlier this month but will need ministerial approval to proceed.
Atlas in its results today said that approvals were forecast for December 2023.
“Unfortunately, due to significant increases in Government processing times and multi layers of red tape, we have seen further delays to the McPhee project.
“The Government needs to do more to reduce red tape and streamline approvals, if it wishes to help raise living standards.
“Shackling industry with more uncertainty via time consuming regulation and duplicated compliance is only damaging Australia as a predictable and reasonable place to invest. Investment being essential to enable living standards to rise.”
McPhee Creek iron ore project, north of Nullagine in the Pilbara, is tipped to produce up to 14 million tonnes per annum of ore over an expected life of 15 years.