More cuts as West Pilbara, Galilee hits the skids

Aurizon announced in its annual results today two important developments for the QLD and WA economies. From Reuters:

Aurizon Holdings said it would be tough to sign off on plans to build new rail lines if coal and iron ore prices remain weak, and held out the prospect of instead returning capital to shareholders.

…Hockridge said if iron ore prices remain around $60 a tonne, it would be difficult to justify building the West Pilbara project, but the companies would be looking at a 16-year timeframe and consider factors like a weaker Australian dollar in evaluating whether to go ahead.

“Clearly the sort of price levels that we’re seeing at the moment would be challenging. No one would deny that,” Hockridge said.

He also played down the chances of the GVK Hancock rail line going ahead anytime soon, with GVK and Hancock still negotiating with each other and Indian banks over terms that would be acceptable to Aurizon. GVK Hancock has given no timeline for a final decision but had hoped to start producing in 2017.

Readers will know my long term view of these projects,  both of which are no more than neo-communist boondoggles that will create jobs in one mine only to close them in other more efficient mines.

Pretty stupid stuff pursued by Comrade’s Campbell and Colin and good to see Aurizon sobering up.

Comments

  1. Guys, this is tip of the iceberg stuff.
    You will note an empolyee of Thiess is being sought in India to assist police with their inquiries into local bribery allegations, Thiess is also the x employer of Mr Nev Power, now with FMG, and now the slush fund for these Australian projects has run-out we are going to hear all sorts of stories of the deals which were concocted to put these projects together. YOu never know who will be implicated.WW

      • Guys, I note Leighton, Thiess parent, in the MSM today, accusations of hiding massive losses from shareholders.
        Warren Buffet has a saying, only when the tide goes out do you see who has been swimming naked. Looks like these guys arent even wearing budgie smugglers.WW

  2. “Readers will know my long term view of these projects, both of which are no more than neo-communist boondoggles that will create jobs in one mine only to close them in other more efficient mines.”

    Yeah might want to end the harping over communism, given that it isn’t communal in any regard – it’s just welfare for the private sector.