Gina Rinehart Photo: Claire Martin
MINING magnate Gina Rinehart's landmark $10 billion Roy Hill project in Western Australia's Pilbara will go ahead nothwithstanding near-term ''hiccups'' and softer iron ore prices, according to one of its directors.
Roy Hill - which is 70 per cent-owned by Ms Rinehart's private company, Hancock Prospecting - has already put back its target completion date from 2014 to 2015 amid speculation it will struggle to raise $7 billion in finance in this market.
But geologist and author Ian Plimer, a director of Roy Hill Holdings, told BusinessDay last Thursday that planning for the project finance was ''well under way'' although documentation was not yet finished.
Major resource projects are suffering cost blowouts and Mr Plimer said ''like all Pilbara operations, you have to be very careful with cost over-runs … (we have) a fabulous team working on that.''
Speaking at the Sydney launch of Ms Rinehart's book, Northern Australia and Then Some, Mr Plimer denied that iron ore prices - which fell below $US90 ($86) a tonne in September but have now rebounded above $US120 a tonne - would harm the project.
''We might have slight hiccups in the very short term but when you're building an iron ore mine that's going to go for 60 years, the short-term variations over the space of six months, or a year, are not important. ''The long term outlook is, there is a growing middle class in Asia that wants your standard of living.''
Mr Plimer said the Roy Hill mine - which he expects to produce 55 million tonnes a year for the next 60 years - would ''go for longer than you'll live and longer than I'll live, and longer than those bureaucrats and politicians who are thinking short-term''.
Mr Plimer, a noted climate sceptic whose 2009 book Heaven and Earth sold millions of copies, indicated that the quality of the resource at Roy Hill would help ensure the project's viability.
''You need finance and you need to be competitive - and the real worry is Australia is becoming high-cost and over-regulated - and you need top quality. That top quality is in the people, and the product (which) has to fulfil very narrow specifications.''