QR National says it remains committed to exploring a major rail project in the Pilbara with Atlas Iron despite the miner holding separate talks with Hancock Prospecting over a different railway tie-up.
As _WestBusiness _ revealed yesterday, Atlas chairman David Flanagan has begun private meetings with Gina Rinehart to gain access to Hancock Prospecting's Roy Hill rail line in return for Port Hedland port space.
Mr Flanagan painted the Hancock discussions as preliminary, in the interests of maximising the efficiency of rail and ports in the Pilbara, and not mutually exclusive with its separate rail study project with QR.
However the move cast a pall over QR's plan which was announced only in April. It is slated to make use of the North West Infrastructure's government-sanctioned berth at South West Creek.
With companies such as fellow NWI member Brockman Resources involved with Atlas in the QR talks, the project has been painted as the Pilbara's first genuine multi-user iron ore rail line that could see its first ore hauled by 2015.
In addition to offering other Pilbara players a path to Port Hedland, the railway would enable Atlas to meet its ambitious production target of 46 million tonnes a year by 2017.
Hancock's $9.5 billion Roy Hill mine is aiming to produce up to 55mtpa by 2014, and is halfway through building its rail line and port space next to the NWI berth in South West Creek. More ore on the line would improve its viability, but may undermine the QR push.
A QR spokesman told _WestBusiness _ that it remained committed to the feasibility study. "QR National is continuing its work on an independent railway for the East Pilbara," he said yesterday. "That work involves Atlas directly and discussions with other parties."
Russell Tipper, the chief executive of one of those parties, Brockman Resources, said it was the nature of the Pilbara for companies to be holding multiple talks and he remained supportive of QR's push.
"With the nature of the Pilbara you really have got to fully embrace the new infrastructure, because if you don't, then you have got nothing, because people will just simply keep putting you off if they don't think you have another alternative," he said. "We are keen to do the feasibility study with QR and we understand so is Atlas."
Mr Flanagan said it made sense for companies in the Pilbara to work together to reduce overinvestment on infrastructure, and any decision would require the approval of multiple parties including NWI and government agencies. ON TRACK $4b The estimated cost of a new Pilbara railway from a study by Atlas Iron and QR National.