Australia has the largest reserves of iron ore, located in the Hamersley Basin of the Pilbara region of Western Australia. The primary haematite ores produced are the dominant iron ores mined and exported. Haematite ores require minimal processing before transport to customers (direct shipping ore or DSO), such as iron ore from BHP, Rio Tinto and FMG.
There are also substantial reserves of magnetite BIFs in
Australia. Compared with haematite ores, magnetite BIFs require a considerable
beneficiation to upgrade resources into to an iron ore product suitable for
steel making. Magnetite mining is an emerging industry in Australia, with large
deposits being developed in the Pilbara and Mid West regions of Western
Australia as well as in South Australia and Tasmania.
What
is Magnetite?
Magnetite (formula Fe3O4, Fe content 72%
by weight) typically occurs as a primary (unweathered) mineral, associated with
silica as chert, in BIFs forming ore deposits with grades between 20-40% Fe.
Primary unweathered BIFs are abundant in the rock record and are the basis of
iron ore industries in China, Russia and Ukraine. Magnetite ores usually
require beneficiation (upgrading) to be converted into a higher grade
concentrate product to be viable for commercial use. This concentrate product
subsequently becomes feedstock for sinter or pellets, depending on grain size.
The magnetic properties of magnetite allow use of highly efficient magnetic
separation techniques to produce iron concentrates. However due to the fine
grainsize of the magnetite energy-intensive grinding is required to liberate
the magnetite from associated gangue minerals. Different ore bodies require
different grind sizes (between 30 and 100 microns) to allow adequate
concentration of the iron content.

Magnetite
Mines in Operations
Sino
Sino is the largest
magnetite mine in Australia, operated by CITIC Limited. The mine is located
100km southwest of Karratha in Western Australia. The project integrates the
mine, concentrator, power station, desalination plant and a 30km slurry
pipeline to the dedicated port at Cape Preston.
CITIC Limited has a right
to mine up to 6Bt of magnetite iron ore from the George Palmer Deposit. Raw
magnetite iron ore from Sino has a low iron content with grading from 15% to
32%. The iron grade of the magnetite concentrate for the life –of mine is
likely to be around 66% Fe with minimal phosphorous or alumina. As the raw ore was
processed, CITIC Limited built a desalination plant and power station on site
to support the processing facilities.
CITIC's Sino Iron project
is China's biggest single investment in Australia at an estimated capital
expenditure of US$12bn, 300% higher than the original budget. The project
achieved first concentrate production in late 2012. ~21Mt of magnetite
concentrate was produced in 2020. CITIC Limited submitted a proposal in
December 2020 to the West Australian Environmental Protection Agency to extend
the life of the operation in maintaining a production rate of 24Mtpa.
The
concentrate is sent to CITIC's special steel plants of Jiangyin Xingcheng and
Xin Yegang with a combined annual capacity of 9Mtpa. CITIC also sells iron ore
to other Chinese mills.
Savage
River
Grange Resources’ Savage River mine is located in rugged terrain
100km by road southwest from Burnie, Tasmania. The current operation produces
2.5Mtpa of 67% Fe concentrate which is transported 83km by pipeline to Grange's
Port Latta pellet plant, which produces 2.5Mtpa of 66.5% Fe BF pellet.
The Savage River magnetite deposit is at the eastern margin of
the Proterozoic Arthur Metamorphic Complex in northwestern Tasmania. Magnetite
ore includes pyritic, serpentinite and talc-carbonate types. The current mineral
resource is 497.5Mt (Fe content of 45.8%) including an ore reserve of 107.7Mt
(Fe content of 47.2%) sufficient for a mine life beyond 2036. Existing offtake
agreements of 1Mtpa until 2022 to Shagang are at fair market prices.
Middleback
Ranges - Magnetite
The South Middleback Ranges Magnetite (Iron Magnet) mine is
owned by SIMEC, the shipping, mining, energy, industry and commodities division
of the GFG Alliance. It lies on the southern end of the Middleback Ranges, on
the northeast Eyre Peninsula, South Australia. Iron Magnet is approximately
50km southwest of Whyalla. Iron Magnet was commissioned in June 2007 with a
mining capacity of 4.6Mtpa and concentrate production at 1.57Mtpa. The mine has
expanded to produce 5Mtpa magnetite ROM iron to produce ~1.8Mtpa pellet and
supply Whyalla steelworks. The balance will be exported to Asian countries.
The Coming Projects
Iron Bridge
The
Iron Bridge iron ore project is located in the Pilbara region of Western
Australia, approximately 100km south of Port Hedland and 25km east of FMG's
Port Hedland-Newman railway line. The project is operated as a joint venture
between Fortescue Metals Group (60.72%), Baosteel (8.28%) and Formosa Plastics
Group (31%). The project includes three resource areas at West Star, North Star
and Glacier Valley. It will produce magnetite concentrate for export through
Port Hedland.
The joint venture
completed construction of Stage 1 in March 2015, which will produce 1.5Mtpa of
+64% Fe blast furnace (BF) pellet feed from the North Star deposit. Stage 2
will expand the project to 22Mtpa of 67% BF feed. The capital expenditure is expected
to reach US$3.3-3.5bn. Project development started in 2019 and first production
is planned for December 2022.
Central
Eyre
Iron Road’s Central Eyre project is located on the Eyre
Peninsula of South Australia, approximately 30km southeast of the regional
centre of Wundinna. In 2019, Iron Road revised a new mine plan that would feed
81.7Mtpa ROM ore to produce 12Mtpa of concentrate with Fe grade of 66.3%. The
current mineral resource is 4,510Mt (Fe content of 16%) including an ore
reserve of 3,681Mt (Fe content of 15.07%).
In January 2021, Iron Road announced that the development
planning for a green manufacturing precinct at Cape Hardy by The Hydrogen
Utility (H2U) is to commence and will integrate an iron ore ‘green pellet’
plant fuelled by renewable energy, using high grade iron concentrate from the
Central Eyre Iron Project (CEIP). The target of pellet production output will
be ~1Mtpa to 2Mtpa.
Conclusion
Compared with haematite ore
mined in Australia, magnetite needs further beneficiation to upgrade resources
into concentrate. Therefore, the operating costs are higher than those of haematite
ore mines. Some mines integrate pellet plants to further process the ore. The
magnetite pellets contain lower levels of impurities, particularly of phosphorous,
sulphur and aluminium. These pellets are premium products that attract higher
prices from steel makers, offsetting the higher costs of their production.