Chinese steel giant Baosteel Group is counting on slashing the A$7.4 billion ($6.90 billion) cost estimate for the West Pilbara Iron Ore project in Australia to justify building a new mine, rail and port that will add to a global glut of iron ore.
Baosteel Resources, working with Australian rail operator Aurizon Holdings Ltd, took control of the West Pilbara Iron Ore project in July after sealing a $1 billion takeover of Aquila Resources.
In buying into West Pilbara, Baosteel shrugged off the disastrous experience
of state-owned rival CITIC Pacific Ltd on the $8 billion Sino Iron project. China’s biggest iron ore investment in Australia began exporting in 2013, three years behind schedule and more than three times over-budget.
The madness of West Pilbara (members)
David Llewellyn-Smith
Friday, 1 August 2014
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About the author
David Llewellyn-Smith is Chief Strategist at the MB Fund and MB Super. David is the founding publisher and editor of MacroBusiness and was the founding publisher and global economy editor of The Diplomat, the Asia Pacific’s leading geo-politics and economics portal.
He is also a former gold trader and economic commentator at The Sydney Morning Herald, The Age, the ABC and Business Spectator. He is the co-author of The Great Crash of 2008 with Ross Garnaut and was the editor of the second Garnaut Climate Change Review.
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