Hick today announced the company’s US$3.9 billion Iron Bridge magnetite project had achieved first production of 67% concentrate on Friday, in line with its revised guidance of the second half of April.
She said the focus was now on a safe ramp-up and estimated guidance of less than 1 million tonnes of concentrate in the current quarter.
Guidance for Iron Bridge will be announced in July.
Hick said the project was a differentiator for FMG.
“The sales and marketing team are already seeing demand for this high-grade product,” she told analysts and reporters this morning.
FMG shipped 46.3Mt of iron ore in the March quarter, down 6% quarter-on-quarter and flat year-on-year.
C1 costs of $17.73 per wet metric tonne were 3% up QoQ but below the lower end of guidance of $18-18.75/t.
Average revenue for the quarter was $108.57 per dry metric tonne, a 87% realisation of the Platts 62% CFR Index.
Acting chief financial officer Andrew Driscoll said revenue was up $22/t QoQ and was the higest price since the first quarter of the 2022 financial year.
Shipments for the nine months to March 31 were a record 143.1Mt.
Guidance was maintained at 187-192Mt of iron ore shipped, despite the three-day closure of Port Hedland earlier this month due to ex-Tropical Cylone Ilsa.
“Can we make it up? We’re certainly looking for a very smooth and stable quarter,” Hick said.
On the development front, FMG has maintained its target of first production from the Belinga project in Gabon in the second half of the year.
Capital costs for an early 2 million tonne per annum operation are forecast at $200 million.
Hick, the former executive vice president of operations at Woodside Energy, said she had spent a lot of time visiting FMG’s sites since joining the company in February.
She said she had spent a lot of time listening and had identified a number of strengths, including the company’s “excellent operational and safety performance”.
“We also have an extremely strong balance sheet,” se said.
FMG closed March with cash of $4 billion after the payment of $1.5 billion in dividends and capital expenditure of $681 million.
Net debt was $2.1 billion.
Hick said the potential challenges included cost inflation, mine plan-drive cost escalation and skills shortages.
She said FMG had no trouble attracting talent but the availability of people would likely remain challenged due to the large pipeline of projects in WA’s resources seector.
Fortescue Future Industries
FFI CEO Mark Hutchinson reiterated the division’s target of making a final investment decision on five projects by the end of this calendar year.
The company has completed construction works at its electrolyser facility in Gladstone and hopes to achieve production this year.
Hutchinson said work at the Gibson Island green hydrogen and ammonia project in Queensland was advancing.
“We’re counting down the days to FID,” he said.
Hutchinson also gave more details on some of the other projects the company was adancing.
FFI has completed a scoping study on the location of a 300 megawatt green hydrogen and green ammonia facility at the Holmaneset project in Norway and is starting a zoning plan process.
It also signed an investment support and implementation agreement with the Kenyan government for the potential development of a 300MW green ammonia and fertiliser facility.
A prefeasibility study has been completed on a green ammonia project in Brazil.
FFI is also looking at green hydrogen projects in Arizona and Texas.
Hutchinson said the projects in the US were moving “very, very quickly” and called for the Australian government to announce similar incentives to those contained in the US’ Inflation Reduction Act.
“The [Australian] government is thinking about it in the right way,” he said.
The projects outlined by FFI are just a handful in a pipeline of more than 100.
“We’re learning every day,” Hutchinson said.
“The race is on – we will definitely get there but it does depend on what ind of project it is.”
FMG shares plunged by 5.2% this morning to A$20.68, a one-month low.
