High Court grants Fortescue Metals Group another chance to win access to Rio Tinto's freight rail lines in the Pilbara, WA
September 18, 2012
Fortescue Metals Group has been granted another chance to win access to Rio Tinto freight rail lines in the Pilbara region of western Ausralia.
In a decision last week, the High Court of Australia passed Fortescue’s rail access application back to the Australian Competition Tribunal (ACT) for fresh consideration.
This is good news for the iron ore miner, since the company has been fighting for access to Rio Tinto’s critical network in the Pilbara for seven years.
In 2008, Federal Treasurer Wayne Swan declared Hamersley and Robe railway lines open to third party access for a period of 20 years to 2028, but the mining giant appealed.
This lead to the ACT’s 2010 decision denying Fortescue access to the Hamersley line and limiting its access to the Robe River line for ten years.
Unappeased, Rio Tinto took the battle to the Federal Court which overturned the ACT’s decision in 2011 effectively preventing third party access to the network under Part IIIA of the Trade Practices Act.
However, last week the High Court upheld Fortescue’s appeal against the 2011 decision, by settling the interpretation of two key points regarding the declaration of infrastructure.
The court decided third party access to private infrastructure can be granted if it is
uneconomical for anyone to develop another facility and if access to the service would not be contrary to the public interest.
uneconomical for anyone to develop another facility and if access to the service would not be contrary to the public interest.
While the High Court did not accept Fortescue’s previous submissions on these criteria, the company is confident its evidence will support a declaration based on the High Court’s preferred “private profitability” test.
Fortescue Chief Executive Officer Nev Power welcomed the decision saying Fortescue intended to put a strong case to the ACT that the Treasurer’s earlier declarations should stand.
“We remain committed to the principle of third party access and are proud to operate
our own railway on an open access basis carrying third party ore,”
Power says.
our own railway on an open access basis carrying third party ore,”
Power says.
Fortescue transports iron ore on behalf of BC Iron, its 50/50 JV partner in the Nullagine Joint
Venture.
Venture.
“Third party rail access will help smaller miners to develop deposits without duplicating expensive and unnecessary rail infrastructure to generate export revenue for Australia,” Power adds.