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OPENING UP THE PILBARA (Australian Iron Ore Region)
The 1960s saw a huge iron ore development programme in Western Australia, the largest mines being in the Pilbara. Apart from Tom Price, major new mines developed there in the 1960s included Mount Newman (Amax, BHP, Colonial Sugar, Selection Trust), Mount Goldsworthy (Consolidated Gold Fields, Cyprus Mines, Utah Development) and Robe River (Cleveland Cliffs).
One of the key issues that had to be addressed in terms of opening up the Pilbara was transport.
The problem that first exercised Hancock and the international miners drawn to the Pilbara was how these fabulous riches were to be transported to market. The potential size of the deposits meant that the majority of the customers for the ore would come from overseas, with Japan being the obvious first port of call. The steel industry in Australia itself, dominated by BHP, was well served by the traditional supplies coming to it from South Australia where expansion was underway in the 1960s.
The suite of discoveries made by Lang Hancock could not all be developed at once, the market just was not there, but Japanese appetite meant that three, Tom Price, Newman and Goldsworthy, were developed. New ports at Port Hedland and Dampier had to be built and standard-gauge railway lines laid to allow the huge ore trains to haul millions of tonnes of product, bound for Asian markets, to the massive bulk carriers at the ports. Port Hedland hosted the Goldsworthy and Newman lines, the longest line from Mount Newman being over 300 miles long, and Dampier was the destination of the original Tom Price railway. Later, ore from Robe River was hauled to Cape Lambert, close to Dampier on yet another line. The trains could be up to two miles long and have over 300 ore trucks.
INDUSTRY GROWTH CONTINUES
Australia is now the third largest producer of iron ore in the world behind China and Brazil, and its exports in volume terms are on a par with Brazil. The Pilbara mines have also materially widened their customer base, exporting not only to Japan and South Korea, but also to India and China. China is particularly interesting being such a major iron ore producer in its own right, but the qualities of the high-grade, haematite Pilbara ore complements China’s own much lower-grade producers.
The original Pilbara producers have since the 1960s increased their output many times, and companies such as Fortescue Metal have also made further substantial discoveries outside the Hancock belt. In its expansion plans for the next few years Rio Tinto hoped to increase Pilbara output to 220 million tonnes by 2012, whilst BHP also has plans to expand output from its 2008 level of 132 million tonnes. By way of comparison, in 1974 total Pilbara iron ore production was around 80 million tonnes.
Disputes have also arisen between the state government in Perth and the old producers about access to their railway lines for the new generation of iron ore miners. The argument being used by the historic producers is that they have plans for substantial expansion of their Pilbara mines and that they therefore cannot offer capacity to new producers.
This has meant that new producers will have to build their own transport links to the WA ports and Fortescue has led the way. Another initiative outside the Pilbara is the Geraldton Iron Ore Alliance which brings together seven small and medium-sized companies with deposits in the central west of Western Australia, including Weld Range, Jack Hills and Wiluna, well to the south of the Pilbara. The long-term plan is to construct transport links to the coast where a new deep-water port at Oakajee to the north of Geraldton would be built.
THE POLITICAL SIGNIFICANCE OF THE PILBARA
The rise of the Pilbara iron ore industry has had a profound effect on the economies of the Far East, and has been a key element in Australia’s engagement with its regional neighbours. In the decade or so after the end of the Second World War Britain and Australia remained close political and trading allies, almost neighbours despite the huge distance separating the two countries. However under pressure from the US to embrace the European Common Market on its doorstep Britain began to negotiate for a new political future. As it did so it began the retreat from Empire and also began to send messages to British Commonwealth Dominions such as Australia that it was seeking new friends much nearer home.
At the same time Far Eastern economies such as Japan, Taiwan and Hong Kong were beginning to grow fast and needed raw materials to fuel this growth. The huge mining boom that rattled on through the sixties underlined to its Pacific neighbours that Australia was a serious contender to be the region’s raw materials supplier of choice. The opening up of the Pilbara in the late 1960s and the huge output of iron ore from the new mines that began to flow then confirmed Australia as a serious regional economic power with new friends and interests in South East Asia.
Although the massive Pilbara developments were from every angle a game changer economically and politically for Australia and Western Australia, there were other iron ore openings outside the region. Western Mining developed a mine at Koolanooka Hills around 190km east of the coastal port of Geraldton and 300km north of Perth. In the north of the state BHP opened the old Koolan Island mine in Yampi Sound in 1965. Further afield in 1967 the Savage River iron ore mine in Tasmania owned by a consortium of local and international companies started exporting to Japan.