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Fortescue Metals Group (ASX:FMG) is an Australian mining company set to become a major exporter of iron ore. The company has large holdings in the Pilbara region of Western Australia. The company is listed as FMG on the Australian Securities Exchange (ASX) and has shown spectacular share appreciation in the last few years.[1] Fortescue Metals is led by entrepreneur and one of Australia's richest men, with a total wealth over $4.5 BN due to the increasing share price over the last 5 years, Andrew Forrest. Forrest also founded Anaconda Nickel (now Minara Resources), one of the world's largest nickel miners.
Directors: [2]
Management
Core BusinessFortescue Metals Group reached a milestone in May 2008 by loading its first iron ore shipment bound for China. Fortescue have at least 10 Chinese steel mill contracts lasting for around 10 years. Baosteel was the first company to receive their iron ore.[3] Fortescue Metals Group is the operator of the mine in Cloud Break. Fortescue also holds major deposits at Mount Nicholas, Christmas Creek, Solomon and Tongolo. InfrastructureThe company has built a mine, a railway and a new port at Point Anderson (aka Herb Elliott port) near Port Hedland. The railway is a heavy duty standard gauge one, with 220 wagons 35,200T trains up to 2.5km long carrying 29,000T of ore at 40T axleload. (The weight of the two 4000HP engines is extra.) The railway is open access (infrastructure) which means that other mines will be able to use it for a fee. Atlas Exports has signed a commercial agreement to use the line and port. RailwayThe Fortescue Railway parallels another iron ore railway (the BHP Billiton railway) for over 100 km. Fortescue sought access to use this line, but BHP declined. The National Competition Council recommended Fortescue should be granted access, but then Treasurer Peter Costello refused the NCC recommendation. However, Fotescue appealed this to the Australian Competition Tribunal. In parallel BHP Billiton sought to overturn the original NCC decision in the Federal and then High Court. On each occasion the judges ruled against BHP Billiton. Railway access would significantly help Fortescue's development and expansion of their 40,000 km² owned area if access is allowed. The Fortescue rail line has a flyover over the Mt Newman Railway, and a crossing of the BHP Billiton railway. The new trains on the Fortescue Railway are fitted with Electronically Controlled Pneumatic brakes for greater performance. The Fortescue trains are amongst the heaviest trains in the world.[citation needed] The "First Ore On Ship" occurred in May 2008, although ballasting of the railway and installation of the final signalling system had yet to be completed. See [4]. ShipmentThe first shipment of ore took place in May 2008, 3.5 years after construction started. Significant increases in shipments of iron ore from Fortescue's Cloud Break mine are expected over 2008. The initial shipment has been hailed as a strong sign that Fortescue will become an increasingly important force in the iron ore market. Talks on increases in ore prices have bolstered this position as competitor Rio Tinto secured a deal that effectively increased ore prices by 95%. Fortescue has announced that it would use Rio Tinto's benchmark iron ore price for the time being. Planned shipments in the coming years: 55 mt (current), 80 mt, 120 mt, 160 mt, 200 mt See also
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