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June 08, 2011

QR National clinches Karara iron ore deal

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QR NATIONAL has secured a 10-year contract to operate all trains from the new Karara iron-ore mine in Western Australia.
Under the agreement with Karara Mining Limited (KML), QR National will carry up to 10 million tonnes of magnetite concentrate and hematite per year from the mine to the export terminal at Geraldton, 400km north of Perth. The deal will generate revenues of around $A 900m ($US 955m) for QR National over the duration of the contract, and the operator will invest more than $A 200m in new locomotives, wagons and upgraded administration and maintenance facilities at Narngulu East near Geraldton.

The initial $A 2bn phase of the mine includes the construction of an 80km line from Karara to Morawa, where iron ore trains will join the existing WestNet Rail line from Northam to Mullewa and Geraldton. The line between Morawa and Geraldton has been upgraded to accommodate future traffic growth as output from the mine increases. The first revenue trains will run next January and by May 2012, QR National will operate four trains per day from Kerara to Geraldton, each comprising 100 wagons.

KML is a 50:50 joint venture between Australian iron-ore producer Gindalbie Metals and Chinese steel manufacturer AnSteel.

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