From Credit Suisse:
Roy Hill has brought forward its ramp-up plan, and now expects to be producing at full capacity of 55Mtpa by the end of the year. The previous plan was to achieve 55Mtpa over a 30 month ramp-up period, and several months ago, it suggested early 2017 as a target. Roy Hill Chief Executive said Roy Hill had built up 1Mt of stock at Port Hedland ready for shipment. (Platts). Credit Suisse Comment: Achieving a full run-rate by the end of the year would be an astoundingly successful ramp-up. Typically, mines startup, and then find parts in the plant that need to be rectified and replaced. It is unclear what is backing the new target, but it is clearly not operating experience, as only small tonnages have been produced to date, and financial completion is not expected until May. Perhaps the delay in the start from Sep 2015 to May 2016 has allowed a build-up of ROM stocks that will provided a faster run-rate provided the plant operates as planned.
What is also clear is that Roy Hill has a lot of pretty whacko public relations swirling around it so best to take this with a grain of salt. If it is true then my $20 something forecast for iron ore before year end is a shoe-in.
