Gindalbie Metals Karara magnetite iron ore project started production this month.
Gindalbie Metals' Karara magnetite iron ore project started production this month.

Premier Colin Barnett has flagged offering the State's magnetite iron ore hopefuls some relief from royalties in a bid to boost investment in the fledgling industry.

Speaking at a mining conference in Perth this morning, Mr Barnett said the idea had not yet been approved by Cabinet, but he intended to push for limited relief for magnetite producers in their first years of operation.

"That hasn't been determined, it hasn't been decided by Cabinet, but senior people - myself, the Mines Minister (Norman Moore) and the Treasurer (Troy Buswell) - agree that we want to show that financial support in the early start-up stages," he said.

"We want to give a very clear signal not only in this State but across this nation and into China and Japan that the West Australian government is not going to tax this industry out of existence, we're going to do exactly the opposite."

Magnetite miners have long been pushing for some relief from State royalties because of the high start-up costs of the industry compared to direct shipping hematite iron ore.

Mr Barnett said the magnetite industry offered downstream processing opportunities for the WA econonomy and the State Government wanted to encourage its development.

WA first magnetite mine, Gindalbie Metals' $2.6 billion Karara project in the Mid West, began production last week in what is being seen as a testcase for the industry in the State.

The West Australian

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