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REGIONAL NEWS - AUSTRALIA/OCEANIA Karara Project Ships First Magnetite Concentrate The Karara iron ore joint venture in Western Australia recently shipped its first delivery of magnetite concentrate, and remains on track to reach full production by the end of April 2013. (Photo courtesy Gindalbie Metals) The Karara iron ore project in Western Australia shipped its first magnetite concentrate from its export terminal at Geraldton, Western Australia, on January 1, 2013. The project is operated by Karara Mining Ltd., a 50:50 joint venture between Gindalbie Metals Ltd. and Chinese steel producer AnSteel. Ansteel has a life-of-mine off-take contract for production from the mine, which includes both magnetite concentrate and hematite direct shipping ore. Commissioning of the Karara magnetite concentrator was ongoing during January, with a goal of achieving full nameplate production capability of 8 million mt/y by the end of April 2013. Karara shipped its first hematite direct shipping ore in March 2011 and as of yearend 2012 had shipped more than 1.3 million mt. The ramp-up performance of its direct shipping ore business demonstrated the efficiency of the entire Karara logistics chain, which continues to perform above expectations, the Gindalbie Metals statement said. As of mid-January, three trains per day were running between Karara and the Karara export terminal, and a fourth train was due to be added as required by the ramp-up schedule. 16 E&MJ; • FEBRUARY 2013 Karara is a surface mining operation located 200 km east of Geraldton. The project is based on the integrated development of a substantial magnetite concentrate operation that has the potential to produce more than 30 million mt/y for 35 years and a smaller-scale hematite operation based on a number of high-grade hematite deposits. A total of A$2.55 billion had been spent on Karara construction, including rail and port infrastructure, through mid-January, and the company expected to complete the project broadly in line with its budget. Xstrata will Raise Zinc Production at Lady Loretta Xstrata Zinc plans to increase ore production by a further 33% to 1.6 million mt/y at its high-grade Lady Loretta mine in northwest Queensland. The greenfield underground zinc-lead-silver Lady Loretta mine began ore production ahead of schedule in September 2012. Commercial-scale mining is due to begin in mid-2013 at a rate of 1.2 million mt/y, and the expanded rate of 1.6 million mt/y is expected by 2016. Capital expenditures required for the expansion are estimated at A$59.2 million, bringing total investment to develop the Lady Loretta project to A$362.2 million. Xstrata Zinc Australia COO Brian Hearne said, "This increase in high-grade ore supplied to our Mount Isa processing facilities reflects Lady Loretta's important place in our regional production profile. The expansion project will allow the earlier recovery of resources from several of Lady Loretta's upper ore bodies and will increase the number of stoping levels available in the underground mine in future years. "To achieve this, we are investing in larger ore-handling facilities; increased mobile and fixed plant equipment, including an expanded ventilation system; more village accommodation; and utilities upgrades." Construction is well advanced on the concrete batch plant, paste plant, warehouse, fuel farm and power station; and surface infrastructure at Lady Loretta was 56% complete as of year-end 2012. The Lady Loretta deposit hosts an estimated 12.7-million-mt reserve, grading 14.2% zinc and 4.8% lead, along with 84 g/mt of silver. Total metal production from the project is estimated at 1.8 million mt of zinc and 610,000 mt of lead. Fortescue Resumes Kings Development Fortescue Metals Group announced in late December 2012 that it would resume development of the Kings deposit at its Solomon iron ore mine in Western Australia in January 2013. Development of the deposit was placed on hold in September 2012. "The recent improvement in iron ore prices and market outlook, along with a number of measures undertaken by Fortescue, including the sale of non-core assets, a reduction in operating costs, and the restructuring of existing bank facilities, underpinned the decision to complete Kings in the new year," the Fortescue announcement said. Resumption of development of the Kings deposit will enable a smooth transition of the construction workforce to Kings from Fortescue's nearby Firetail deposit, which is ramping up to a production capacity of 20 million mt/y by the end of March 2013. Mining at the Kings deposit is expected to achieve design capacity of 40 million mt/y by the end of 2013. www.e-mj.com