Mount Gibson Iron Limited (ASX: MGX) has announced a highly positive update regarding its Koolan Island operation located approximately 140km north of Derby in the Kimberley region of WA.
MGX announced that it has recommenced the sales of high grade iron ore from the formerly BHP-owned Koolan Island mine. The mine was shut down after the flood damage of 2014.
The company reported that after spending two years on redevelopment and refurbishment work at the site, the first shipment loaded with cargo is all set to depart to China.
Koolan Island Mine
Koolan Island Mine is known as the highest grade direct shipping iron ore operation in Australia. The Ore Reserves in the Koolan Main Pit is estimated to be 21 million tonnes grading 65.5% Fe, scheduled to be mined over the next 5.5 years. This makes Mount Gibson Australia’s highest grade exporter of direct-shipping hematite iron ore.
Flood Damage and Reconstruction
The Koolan Island Mine had suffered extensive flood damage in 2014 when its sea wall collapsed. The company reported that nearly two years of redevelopment and refurbishment work at the site had to be done to make it operational.
The work included the construction of a new seawall containing an impermeable seepage barrier, pit dewatering, footwall rehabilitation, pre-production waste mining, general site infrastructure refurbishment, and the recruitment and mobilisation of more than 300 employees and contractors.
It may be noted that indigenous employees account for more than 20% of the site workforce, including many from the Dambimangari People, the Traditional Owners of Koolan Island.
The company reported that a cargo of approximately 72,000 wet metric tonnes of high grade hematite iron ore, averaging 65% Fe is currently being boarded aboard the bulk carrier MV S’Hail Al Mafyar. This boarding is now nearing completion ahead of the vessel’s scheduled departure from Koolan Island for delivery to customers in China.
Mount Gibson Chief Executive Officer Peter Kerr said: “It is very satisfying to bring the unique high-grade Koolan Island mine back into production after more than two years of dedicated effort by the Mount Gibson team. We also greatly appreciate the ongoing support from the Dambimangari community in achieving this milestone.
“The high grade and quality of Koolan Island’s direct-shipping hematite iron ore products means that they are well suited to China’s increasing focus on steel manufacturing productivity and environmental impacts, and will provide Mount Gibson with a solid platform from which to generate value well into the next decade.”