Highest leap for iron ore since August

Iron ore’s largest one-day gain in nine months has pushed the bulk commodity back to levels seen before March’s “flash crash”.

Improving emerging market sentiment and increased hopes of stimulus in China saw iron ore lift 4 per cent overnight The benchmark iron ore price, a measure from the port of Tianjin in China, has risen 5.7 per cent in the last week, now sitting at $US116.90 ($126.22).

Iron ore, emerging markets and riskier assets, in general, have had a strong run in the last week, Deltec chief investment officer Atul Lele said.

The MSCI Emerging Markets Index has jumped 4.2 per cent in the last week.

Cheap valuations in emerging markets, hopes of stimulus in China and hopes of further liquidity injections globally, are all supporting iron ore and riskier assets, Mr Lele said.

The recovery in iron ore comes after a “flash crash” three weeks ago, which saw the metal plummet more than 8percentinone day. The fall was attributed to financial arrangements which used iron ore as collateral being unwound. However, analysts said investors should not expect a return to levels above $US130 per tonne.

“At present, none of the indicators suggest that we’re going to see a strong resurgence in the iron ore price. But that’s not withstanding any stimulus that comes through from China aimed at fixed asset investment” Mr Lelesaid.

Expectation of increased investment in infrastructure from the Chinese government to prevent the economy from slowing were reflected in the jump in iron ore and steel prices.

China rebar steel futures gained 1.1 per cent overnight and have added 3.7 per cent in the last week.

Liquidity concerns over commoditybased finance deals in China have eased and iron ore is returning to fundamentals, CLSA analyst Andrew Driscoll said. “Most important over the last couple of weeks, and there was a data point yesterday, steel inventory at the mills has been ticking down,” Mr Driscoll.

“The mills are selling steel into the market and the steel price is holding up OK,

suggesting that the demand is there for the steel.” On top of the hopes of stimulus, expected seasonal upturn in steel consumption was helping the iron ore price, ANZ head of commodity research Mark Pervan said.

“The gains were despite a further rise in port inventories last week; however,

the 38 kilo tonne build last week was the smallest in several weeks,” he said.

“Talking to the industry in the last couple of weeks, these guys are now thinking we’ve probably hit the bottom of the iron ore market and are looking to reposition. However, they’re probably waiting for slightly better seasonal demand to kick in.” Any increase in iron ore prices will need to be backed up by a jump in steel consumption. Infrastructure and property are the biggest consumers of steel in China, accounting for around 67 per cent of consumption.

Fortescue’s $1.15bn deal gets Pilbara project up and running

Fortescue Metals closed a $1.15 billion deal on Friday with Taiwanese steel firm Formosa Plastics which will see its FMG Iron Bridge project get off the ground.

Formosa will join a partnership agreement, created 14 months ago when Fortescue struck a deal with Chinese steel major Baosteel.

FMG Iron Bridge was scheduled to float on the Hong Kong Stock Exchange last year, but was put on the back burner when iron ore prices plummeted in late 2012, SMH reports.

Under the new deal, Formosa will dish out $123 million to secure 31 per cent of a new partnership with FMG Iron Bridge, and will fund the first $US527 million ($576 million) to construct the stage one of the Pilbara project.

The project, located about 100 kilometres south of Port Hedland in WA includes the North Star and Glacier Valley iron ore deposits, estimated to have a combined iron ore resource of 5.2 billion tonnes.

Formosa has also agreed to purchase 3 million tonnes of iron ore a year from Fortescue at market prices and if stage two of the FMG Iron Bridge project is approved it will participate.

The company has also agreed to make an upfront payment of $500 million to Fortescue to secure access to its port and rail assets in the Pilbara. The prepayment demonstrates customers are will to pay substantial sums to access the company’s infrastructure.

Fortescue has been considering selling off its stake in its Pilbara port and rail assets, but is also battling smaller miners who are attempting to gain access to its railway under third-party access laws.

The asset sales were earmarked amidst a high Australian dollar and low iron ore prices, a situation which sparked debt issues for the company.

But the company’s financial position has since been assisted by the Aussie dollar dropping below parity with the US and the stabilisation of iron ore prices.

Fortescue chief executive Nev Power said the deal will strengthen the company’s balance sheet and when asked it The Pilbara Infrastructure (TPI) sale would go ahead he remained non-committal, SBS reports.

“TPI transactions will only proceed on the basis that we get full market value for those assets and get it on terms that allow us to continue to operate our network efficiently,” he said.

He added that the sale of “non core assets” is helping the company meet its debt obligations with increasing speed.

Power explained that granting Formosa access to the infrastructure is completely separate to the third-party access processes, but the move does send an important message.

”What I think it does do very clearly is demonstrate the tremendous value that is in the infrastructure we built, it’s world-class infrastructure, it’s highly efficient and highly productive,” he said.

Power added that additional joint venture partners could be brought into the project, flagging Fortescue is aiming to lower its 61 per cent stake in the assets.

”We want to maintain a minority interest in the project, but with an interest now effectively at 61 per cent we do have some further opportunity, and of course we are 88 per cent within FMG Iron Bridge so there is certainly an opportunity for further investment by others in the project,” he said.

Stage one of the project is expected to take 12 months of construct, with first production expected in early 2015.

The first stage will see 1.5 million tonnes of hematite exported, with the second stage ramping up to see 9.5 million tonnes of magnetite concentrate piped to Port Hedland for export.

The deal is subject to approval from both Australian and Taiwanese regulators.

http://www.miningaustralia.com.au/news/fortescue-s-$1-15bn-deal-gets-pilbara-project-up-a

Rio Tinto to Go Ahead With $5B Pilbara Expansion Despite Weak Price for Iron Ore

The world’s second-largest miner, Rio Tinto (ASX: RIO) will push through with its $5 billion plan to expand the Pilbara iron ore mine despite the lower price of iron ore in the international market. The mining giant has planned the expansion in 2011.

The decision to push through is because of Rio’s target to produce 360 million tonnes of iron ore per annual. Although shareholders had been pushing Rio to preserve the money and hold expansion, Rio Chief Executive Sam Walsh told analysts in London the Pilbara mine expansion Is inevitable, but the mining giant still needs to specify the timetable under the current plan which the Rio board will deliberate for approval in November.

He said Rio could be flexible with the planning in terms of timetable for the completion of the venture.

“What will drive the expansion will be what the market demands physically. We are going to be very rational and logical about this to ensure we are delivering value to shareholders and not just proceeding with something because it’s on the books,” Mr Walsh explained.

Analysts believe Rio would approve the Pilbara expansion before the end of 2013.

However, the plan by Rio to mine the Koodaiden deposits would likely be opposed by environment groups because it lies next to the Karijini National Park. The mine is about 100 km west-northwest of Newman, and has the potential to produce 35 metric tonnes per year which could even rise to 70 by 2030.

Rio plans to mine the area with a sequence of open cuts. Most of the puts are above the water table with only minor dewatering needed.

Big miners regaining favour

Tony Featherstone is a Morningstar contributor and a former managing editor of BRW and Shares magazines. This article was originally published by Investor Weekly, a Sterling publication.

What a difference a few weeks makes. In September, newspaper headlines screamed about the meltdown in iron ore prices, and resource stocks tumbled. Commentators called an “end” to the mining investment boom amid fears that China’s economy was heading for a hard landing.

After tanking to US$88 a tonne last month, the iron ore price has rebounded to US$120 a tonne. Fortescue Metals Group (FMG) this week said it expects the iron ore price to stablise at current prices; Macquarie Equities Research sees a floor of US$115 over the next few years.

The big mining stocks have followed the iron ore price higher. Australia’s third-largest iron ore miner, Fortescue, has stunningly rallied from below $3 in September to $4.07. Macquarie has an outperform recommendation on it.

Rio Tinto (RIO) has jumped from a 52-week share price low of $48.37 to $56.05, and BHP Billiton (BHP) has rallied from an annual low of $30.09 to $33.45. Their prices are still well down on peak levels over the past 12 months, but sentiment has improved markedly from a few weeks ago.

Macquarie has outperform recommendations on Rio and BHP. Its 12-month share price targets of $76 and $39 respectively for Rio and BHP suggest considerable upside and a catalyst for a sharemarket rally in 2013 given the high weighting of these stocks in the S&P/ASX 200 index.

Several small and mid-size resource stocks are also starting to rally, after heavy falls this year.

Solid quarterly production reports from the big miners have also buoyed investors, and reports last week of better-than-expected Chinese export data led to calls that its economic slowdown may have bottomed.

A resumption of stronger Chinese growth would support higher commodity prices and potentially higher share prices of leading ASX-listed resource stocks.

Mining services stocks with heavy iron ore exposure, such as NRW Holdings (NWH), also rallied this week after sharp falls in recent months. Tumbling iron ore and coal prices raised fears that more mining projects would be cancelled or deferred, in turn leading to less work for service providers.

Conditions are not as strong as a year ago, but fears about some mining services stocks may have been overstated.

Australia’s Aquila fights to trim $7.6 billion cost of iron ore project

MELBOURNE (Reuters) – Aquila Resources is scrambling to cut planned spending on an Australian iron ore project after cost estimates jumped a quarter to A$7.4 billion ($7.6 billion), putting the investment at risk in a sector squeezed by cooling Chinese demand.

Aquila aims to build a mine, rail and port in Western Australia with annual iron ore production of 30 million metric tons, but its half-owned project is under pressure due to weak Chinese steel demand, soaring capital costs and a strong local dollar.

The West Pilbara Iron Ore project is one of the biggest in a $250 billion pipeline of planned mining investments in Australia that may be frozen or delayed as bankers get nervous about the outlook for iron ore and coal, and escalating costs.

Iron ore prices hit a three-year low of $86.70 a metric ton last month before reviving slightly, forcing miners from the world’s largest BHP Billiton down to the smallest to review their investment plans.

In an effort to cut capital spending, Aquila said on Monday studies had identified up to A$2.3 billion of possible savings by outsourcing the operation, ownership and funding of such tasks as ore processing, rail freight, ports, power and fuel.

Handing over those elements to other investors would add about A$15 a metric ton in operating costs, currently estimated at A$24.20 a metric ton, Aquila said, adding that no decision had yet been made on the recommendations of its capital spending study.

Aquila said the cost of the project, previously estimated at $6 billion, had risen due to a general rise in costs since the previous estimate in 2010 and because of changes in plans for the new port by the Western Australian state government.

Australia is the world’s biggest producer of iron, but a failure to get Aquila’s project off the ground would mean a big chunk of ore supply could be left stranded with BHP and Rio Tinto maintaining a lock on rail lines in the area.

The project’s progress has been slowed by delays in approvals and financing, compounded recently by the fall in iron ore demand and prices.

It has been further set back by a dispute between Aquila and its partner AMCI (WA), a joint venture between private mining investment and trading group American Metals and Coal International (AMCI) and steel giant POSCO <005490.KS>.

They had been in talks to conserve funds but the partners were unable to agree on a budget for the 2012/13 financial year, a dispute that now needs to be resolved by an arbitrator and could result in one of the partners being bought out.

More than A$460 million has already been spent on studies, design work and state and federal approvals.

Aquila has around A$500 million in cash and no debt. It has been shedding assets, including a stake in a coal mine that was its only producing asset, to raise funds to help cover its share of the iron ore project, on which it hopes to begin construction in mid-2013.

COUNTING ON CHINESE FUNDING

Aquila, 14 percent owned by China’s biggest listed steelmaker, Baoshan Iron & Steel Co <600019.SS>, has been counting on China Development Bank to help fund the project.

To line up that debt funding, Aquila has to be able to show that the port for exporting the ore will be built.

China Development Bank is reluctant to sign off on mine funding in light of the long delays and cost spikes that other Chinese iron ore projects in Australia have faced, including CITIC Pacific’s <0267.HK> Sino Iron project. Costs on that mine have more than tripled to $8 billion.

Final environmental approval from the state of Western Australia for the port, a key hurdle, is expected before the end of this year, Aquila said.

The state had been encouraging joint development of the proposed port, Anketell Point, involving Aquila and Australia’s No.3 iron ore miner Fortescue Metals Group , but debt-laden Fortescue has slowed its expansion plans and does not see a need to use Anketell Point in the next few years.

The initial plans are for Anketell Point to have an annual capacity of 115 million metric tons, eventually expanding to 350 million metric tons, and the state is eager to ensure whoever wins the rights to build it will have the funding.

Lining up third parties to fund construction of the port could help secure the state’s go-ahead.

The West Pilbara Iron Ore project already has preliminary approval for a 282-km railway, which it needs to build as it will not have access to existing railways in the area, owned by the world’s No.2 iron ore miner, Rio Tinto.

Shares in Aquila fell 1.1 percent to A$2.65 in a slightly softer market, having tumbled from a 12-month high of A$6.83 in December.

($1=0.9767 Australian dollars)

Rio Tinto becoming more optimistic on iron ore prices

RIO Tinto is becoming more optimistic about the outlook for the iron-ore market following a recent partial price recovery for the steel-making ingredient.

“We probably look forward with a little bit more optimism than we did perhaps a month or two ago when we were still in the midst of seeing declining prices and no-one really knew when it was going to bottom out,” Greg Lilleyman, president of Rio Tinto’s Pilbara iron-ore operations, said today.

Meanwhile, Rio Tinto has noticed a response from China’s mining sector to the lower prices, including the “exit” of some higher-cost Chinese iron-ore producers, Mr Lilleyman said at a seminar in Perth.

“We believe that will hopefully help in limiting further downside in prices,” he said.

Prices should also be supported by slower-than-expected growth in seaborne iron-ore supply due to rising costs and project delays in several countries, including Australia, he said.

Rio Tinto, unlike some of its Australian competitors, hasn’t chosen to slow down expansions of its Pilbara iron-ore business in response to the lower prices. Its current expansion, to 353 million tonnes a year, is due to come on stream in 2015.

However, earlier this week Rio Tinto pledged to tackle costs across its operations and said it wasn’t likely to approve any big, new capital-intensive projects in the near term in view of a slump in commodity prices and a faster-than-expected cooling of China’s economy.

The miner still expects to invest roughly $16 billion in capital projects this year, but spending would likely decline in the coming years, the company said.

http://www.theaustralian.com.au/business/mining-energy/rio-tinto-becoming-more-optimistic-on-iron-ore-prices/story-e6frg9df-1226494434444

West Africa emerging as new Pilbara as miners race to develop iron-ore projects

The ‘new’ iron-ore deposits in West Africa – which have attracted interest from some of the world’s major miners – could be as abundant as those in Australia’s Pilbara region.

In fact, some analysts have remarked that West Africa is emerging as the next significant iron-ore region, with global mining majors like BHP Billiton, Rio Tinto and Kumba Iron Ore, as well as Chinese companies, pursuing iron-ore projects in the region.

The iron-ore deposits in West Africa are said to be of a high grade, with low impurities and entailing low processing costs – which is important for mining companies that prefer direct shipping ore (DSO). DSO is favoured among mining companies, as it eliminates the need to beneficiate the ore before it is exported.

However, the recent drop in iron-ore prices has raised questions about whether investments in West Africa will decrease until prices stabilise. The price drop reflects limited interest among steel mills in restocking the steelmaking raw material, given the uncertain outlook for steel demand. Iron-ore with a 62% iron content dropped 2.5% on September 21.

But independent minerals economist Tendai Furamera explains that the West African iron-ore projects are due to start in and after 2018 and, as investment decisions are based on long-term real price estimates for iron-ore, current spot prices will have little impact. “The investments are based on assumed cost of marginal production from 2018 and beyond.”

Meanwhile, Africa-focused Australian iron-ore developer Equatorial Resources MD John Welborn said at the 2012 Africa Down Under conference, in August, that China wanted to import half of its iron-ore from Chinese-owned mines elsewhere in the world to broaden its supplier base. “China is the dominant buyer of seaborne iron-ore and imports more than 650-million tons a year, which is 63% of the total global seaborne iron-ore demand,” he said.

Further, he said it was almost certain that increased production from the traditional regions, such as Australia, would not fill the gap, so it was likely that projects in Central and West Africa would be developed to meet the demand. Raw iron-ore in China has an iron content of about 15%, compared with the 60% iron content of the iron-ore produced in West Africa, Australia and Brazil.

“This has caused a race to production along the West Africa coastline, with companies worldwide aiming to develop iron-ore projects,” said Welborn.

Furamera says another iron-ore frontier in West Africa is likely, but does not believe it will be anywhere near the size of Pilbara.

“There are a number of potential world-class deposits in West Africa, such as Simandou, in Guinea, and Faleme, in Mali. The ‘new Pilbara’ in West Africa also has the potential for higher lump:fines ratios (the selling price of fines is lower than that of lump iron-ore), compared with Australia’s Pilbara Mara Mamba mine’s ores, which makes the resources [more] valuable,” he says, adding: “The potential for single large-scale mines in West Africa is estimated to be tens of millions of tons.”

Furamera adds that iron-ore is the most abundant mineral on earth and that its supply is endless, but the issue, however, is the quality of the ore, as a viable iron content is necessary to run blast furnaces. The required standard percentage is more than 60% iron content.

Iron-ore is a bulk mineral and requires large investments in rail and port infrastructure, and the West African mining industry needs major improvements.

Welborn said the challenge to developing an iron-ore mining industry in West Africa was infrastructure, noting that the region needed to develop its railways, ports and mines. He noted that new production was only coming on stream in West Africa where high grade, near-surface iron-ore bodies were in close proximity to existing rail infrastructure.

According to analyst GlobalData, Liberia must improve its road connect-ivity through the construction of an additional 800 km of regional roads and 1 500 km of national roads to meet connectivity standards and fully capitalise on its iron-ore mining potential.

And neighbouring Sierra Leone needs additional rail and port facilities, as there is only one of each to serve the iron-ore industry. Its Pepel port serves the entire sector and has the capacity to handle 16.2-million tons a year. The current production rate is 16.5-million tons a year, which is expected to increase to 67-million tons a year by 2020.

Current Developments

BHP Billiton currently has a 41.3% interest in a joint venture (JV) that holds the Nimba Mining Concession and four prospecting permits in south-east Guinea. The JV is undertaking a prefeasibility study into the develop-ment of the concession and associated transport infrastructure. The mine expects to deliver high-grade DSO to international markets.

BHP Billiton – the world’s largest resources company – has a 100% interest in a Mineral Development Agreement with the Liberia government. This enables further exploration and development of its Liberian iron-ore mineral leases, which are near existing rail and port infrastructure. Exploration at these leases continues, with drilling taking place on selected targets.

South Africa’s Kumba Iron Ore, an Anglo American subsidiary, also has its eyes on West Africa’s iron-ore endowment. “Kumba’s growth strategy has evolved into an Africa-focused one and its aim is to create a second mining footprint in Africa in partnership with Anglo American, but will not bet on West Africa and will wait for the right opportunities,” says communication and brand manager Gert Schoeman.

Kumba and Anglo American have signed a Liberian exploration deal with Jonah Capital, in terms of which they will spend $10.5-million in the JV over three years at Gbarnga and Kalasi.

“At this stage, Kumba is assessing a broad spectrum of options, ranging from near-development projects to early-stage greenfield opportunities in several target countries in Central and West Africa,” he says.

Rio Tinto CE Tom Albanese said in June that the company would invest $501-million for further infrastructure development at the Simandou iron-ore project, in Guinea.

The Simandou project will comprise a mine, about 700 km of trans-Guinea railway and a port south of Conakry, the capital city. After the five-year ramp-up, it is expected that up to 95-millon tons a year of iron-ore will be exported and first shipment is expected in 2015. Rio Tinto expects Simandou to become the largest integrated iron-ore mine and infrastructure project in Africa.

“Further investment will be made as the Guinea government progresses its financing strategy and grants approvals for the next steps in developing rail and port infrastructure,” Albanese added.

First commercial production is expected in mid-2015 and the project is expected to become a long-life, low-cost operation, producing one of the highest-grade iron-ore on the market.

West African Minerals previously told Mining Weekly that it intended to focus on DSO and high-grade ore and had innovative quick-to-market logistics schemes for its close-to-port Cameroon and Sierra Leone properties. Further, the company’s aeromagnetic results indicated that it might be in possession of a property larger than Sundance Resource’s adjacent Mbalam project on the Mbarga deposit, in Cameroon.

Sundance CEO and MD Giulio Casello said at the Africa Down Under conference that its Mbalam project was a pioneer project for the region. He added that environmental approvals had been received for the port, rail and mines in Cameroon and that infrastructure development included a 510 km rail line for transporting iron-ore and a 70 km spur line from Nadeba. There would also be a deepwater port, capable of taking bulk iron-ore carriers of up to 300 000 deadweight tons.

Investing in, exploring and developing iron-ore projects in West African countries will result in people who are affected by mining activities benefiting from the upliftment of communities through the improvement of clinics, hospitals and education, which miners are obliged to provide. They will also provide skills training and job opportunities and will help to develop the much-needed infrastructure.

The ‘new Pilbara’ iron-ore deposit that spans West Africa will provide enough iron-ore to match the projected future global demand. The recent drop in iron-ore prices has had little effect on major mining companies’ exploration and development activities in West Africa because they plan according to projected prices based on when the mines will start to produce.

http://www.miningweekly.com/article/red-gold-in-africa-exploring-red-gold-red-gold-rising-2012-10-05

The outlook from Shanghai

IMAGINE the world as seen from the head office of an industrial conglomerate in Shanghai or Seoul. In the iron ore market, the Pilbara still looks competitive, but the next generation of mines in other parts of Australia is looking expensive compared with mines in West Africa that cost little more than half as much to dig.

The cost of Australian thermal coal is rising and new mines in Colombia and Mongolia are looking more attractive. Aluminium is considerably cheaper to produce in China or in the Middle East, where higher capital costs are offset by cheaper energy. Newly developed nickel pig iron technology can process low grade ore from The Philippines and New Caledonia for a fraction of the Australian cost.

The Mineral Council of Australia’s report on risks to the resources industry released yesterday reminds us of the eternal truth that no one owes this country a living. We have abundant natural resources, we are good at getting them out of the ground and we are a reliable trading and investment partner, but there is no sector in which Australia enjoys a monopoly. The entry of new suppliers in the global resource market should not catch us by surprise since Australian expertise has speeded their development. Softening demand and lower returns do not spell the end of the mining boom, by any stretch of the imagination, but we will have to fight harder for the mining dollar if we are to keep a step ahead.

Success in this new, competitive environment will require a new approach from a government that has been more focused on extracting and redistributing taxes from mining rather than encouraging flexibility, productivity and innovation. We cannot simply blame the high dollar or a temporary slowdown in China; we must recognise that we have a home-grown productivity problem that must be addressed. Project delays in Australia have been increasing over the past decade; for coking coal projects, for example, the average delay in Australia is 3.1 years, compared with 1.8 years in the rest of the world. The high cost of labour, Australia’s perennial disadvantage, can be mitigated by fast-tracking development procedures, removing green and red tape, encouraging job participation, skilled immigration and flexible workplace rules. Australia’s mineral resources remain attractive, but we must work hard to keep our competitive edge.

Pilbara iron ore rail battle heats up

Fortescue has won its High Court appeal over access to Rio Tinto and BHP’s iron ore rail networks in the Pilbara.

The Australian iron ore miner had been fighting for access to Rio’s Hammersly and Robe River lines, as well as BHP’s Goldsworthy and Mount Newman networks.

In 2010 the long running battle came to a head when the Australian Competition Tribunal rejected Fortescue’s push for access to BHP and Rio rail networks, and allowed the two major miners to retain full access to their own Pilbara rail lines.

The Tribunal rejected the application by Fortescue Metals and a group of junior miners to gain access to the rail lines, finding that access by these miners to Rio’s Hammersley lines and BHP’s Newman rails “would be contrary to the public interest.”

The Tribunal’s inquiry found that the actual costs in providing access had the potential of dwarfing whatever benefits might exist from avoiding duplication of lines.

However, despite this the Tribunal did find in favour of the applicants for access in regards Rio’s Robe River railway and BHP’s Goldsworthy line.

Fortecue continued in its fight to gain full access to the Pilbara network, and was granted a High Court appeal late last year.

In its appeal FMG made technical arguments about the court’s interpretation of the law.

The High Court has now found that the Tribunal’s decision was not legal, according to the ABC.

This has now allowed Fortescue to again pursue access to the Pilbara rail lines.

Graham Short, from AMEC, explained there is still some way to go before a decision on access is reached.

“There’s obviously still further negotiations to be conducted and, as I understand it, it would still need to go through various tests so that it would be considered by the Australian Competition Tribunal.”

Rio Tinto came out against the decision, however it did note that it was “pleased to note that the High Court accepted its formulation of the proper test for the threshold question of whether a facility can be economically duplicated.

“The Minister and the Tribunal both applied the wrong test in determining this threshold issue, and the Tribunal will be bound to adopt the test Rio Tinto argued for on any reconsideration.”
Rio went on to add that its “integrated operations in the Pilbara would be severely impacted if third parties were permitted to run trains on the system. As the Tribunal noted, the potential disruption and diseconomy costs would dwarf whatever benefits might exist in permitting third party access”.