The state’s Far North is set to face a jobs boom following an $800m investment into the expansion of an iron ore mine near Coober Pedy.
Up to 1300 jobs will be created at the privately-owned Cairn Hill mine in the state’s Far North, after iron ore producer CU River secured investment from Jiujiang Mining Australia.
CU River, which is one of SA’s two operating iron ore producers, acquired the mothballed Cairn Hill mine, 55km from Coober Pedy, in 2014.
It invested $20m into the mine, kicking off production in June 2016 before hitting its one million tonne production target in just over a year.
CU River managing director Yong Gang Shan says the Cairn Hill mine’s ultimate production target is 15 million tonnes of magnetite per year.
It is expected to reach this target by 2021, and as part of the funding agreement with Jiujiang Mining Australia – a local subsidiary of a Chinese steel producer – all of the mined ore will be exported to China.
Mr Shan says the expansion is due to the world’s “ever-increasing” demand for steel.
He says many of the 1300 jobs created will be in the regions.
“In addition, we will be using SA suppliers for goods and services wherever possible, so there is a flow-in effect in terms of secondary job creation and stabilisation,” Mr Shan says.
“The industry standard is that as a general rule, every job in the mining sector creates three support jobs elsewhere.”
He says CU River has offices in Adelaide and Coober Pedy and is recruiting for key positions.
“It is company policy to employ our own people for exploration and mining work, rather than outsource to subcontractors,” Mr Shan says.
CU River’s alliance with Jiujiang will provide financing for the expansion of the magnetite mine as well as planned infrastructure projects.
“Jiujiang will provide the financing for the expansion of the Cairn Hill mine, new infrastructure to enable increased output, an exploratory drilling program with an initial approved scope of 13,000 metres, and development of the next two projects in our pipeline, Snaefell and Tomahawk, which are both in the vicinity of Cairn Hill,” Mr Shan says.
“Part of the funding will also be needed for associated infrastructure work including road and rail upgrades and extensions.”
Mr Shan says the company has received approval for expansion of Cairn Hill’s pits 3 and 4, which are central for the immediate increase in iron ore production.
A 13,000 metre exploratory drilling program is currently underway to define the resource in pits 1, 2, 3 and 4.
Production at Cairn Hill is currently paused to allow for construction of a wet processing plant, with mining set to resume once this is completed.
The expansion of Cairn Hill follows BHP’s $600 investment in Olympic Dam and Oz Minerals’ Carrapateena project.
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