Vincent Tremaine - Flinders Port Holdings - Developments at Flinders Ports

Vincent  Tremaine    CEO    

Flinders  Port  Holdings  

Flinders  Port  Holdings    A  Growing  Business  

!  Flinders  Port  Holdings  •  Who  We  Are  And  What  We  Do  •  Our  Owners  •  Our  Core  Business  •  Our  Growth  Strategy  •  Our  Subsidiary  Businesses  

!  Port  Growth  •   The  Iron  Ore  Challenge  •  Berth  29  

!  LogisFcs/Stevedoring  Business  •  Copper  Concentrates,  Mineral  Sands  •  Bulka  Bags  

!  The  Adelaide  Container  terminal  

Contents  

!  Privately  owned  –  acquired  in  November  2001  !  5  private  shareholders  !  Own  7  South  Australian  ports  !  Control  shipping  movements  and  pilotage  to  10  SA  ports  !  Own  41  shipping  berths  !  Own  &  operate  the  Adelaide  Container  Terminal  !  Own  Flinders  LogisKcs  !  Own  Hydrosurvey  

Flinders Port Holdings Shareholders

Core Business

CORE  BUSINESS  

Growth Strategy

Growth  Strategy  

•  In 2009 we acquired 40% of the Adelaide Container Terminal •  In 2012 we acquired the remaining 60% of the Adelaide Container Terminal •  In 2010 we formed Flinders Logistics which is now a thriving stevedoring

business serving the South Australian mining sector

The Company Structure

CEO  Vincent  Tremaine  

GM  Stewart  Lammin   GM  Andrew  Pellizzari   GM  Peter  Cheers  

Flinders Ports

Thevenard  

Port  Pirie  

Port  Lincoln  

Wallaroo  

Port  Giles  

Adelaide  

Klein  Point  

Whyalla  Arrium  

Bonython  Santos  

Ardrossan  Viterra  

Melbourne  725kms  

Darwin  3,027kms  

777kms    from    

Adelaide  

Flinders Ports Caltex Fuel Berth $22m – completed in August 2014

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RSAYS  Caltex  Tank  

Farm  LocaKon  

Berth  #4  Fuel  Berth  

Fuel  Pipeline  

Mining Growth Opportunity/Challenge

The  Challenge  -­‐  TransporKng  Cargo  to  a  suitable  port  and  onto  a  ship  !  Iron  Ore  –  Low  value,  large  parcels,  prefer  deep  water  !  Mineral  Sands/Copper  Concentrates/Zinc  –  High  value,  smaller  parcels,  don’t  

require  deep  water  

The  Opportunity  

Iron Ore - Global Demand

Iron Ore – The Economics The Iron Ore Challenge

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CIF  China  Cost   AUD  Rate   Long  Term    1st  QuarFle   2nd  QuarFle   3rd  QuarFle   4th  QuarFle  

$AUD   SA  Deposits  &  

Producers  –  cost  base  ($AUD)  

Market  rate    (Fe63.5%  -­‐  $AUD)    Jan  2010  –  July  2014  

100  year  $US  average  iron  ore  rate  converted  to  $AUD    

•  Over  past  100  years  the  Long  Term  Iron  Ore  average  price  equates  to  $US80  /  tonne.    •  SA  Junior  Miners  generally  are  in  the  4th  QuarKle  on  the  basis  landed  cash  cost  (CIF)  into  

China  compared  to  BHPB  operaKons  which  are  in  the  1st  /  2nd  QuarKles.    •  There  is  new  low  cost  capacity  coming  on  stream  in  the  Pilbara  •  This  combined  with  lower  prices  forecast  over  the  next  5  years  or  so  means  that  the  SA  

Junior  Miners  are  likely  to  again  delay  projects  unKl  there  is  another  structural  shic  in  the  cycle  

CIF  Cost  base  v  Market  /  Long  Term  Average  Iron  Ore  Price  ($AUD/t  @  63.5Fe)    

The  Latest  

•  Price  yesterday  $US83.60  •  Price  1  year  ago  $US134.80  •  Down  38%  

•  Price  in  2011  $US185.60  •  Down  55%  

•  A$  yesterday  $93.70  •  A$  1  year  ago  $88.82  •  Up  5.5%  

Iron Ore Loading Methods

1.  Bulk  into  Deep  Water  !  High  capital  cost  !  Low  operaFng  costs  !  High  shipping  scale  economies  !  Long  lead  Fmes  

2.  Containerised  !  Low  capital  cost  !  High  operaFng  cost  !  Moderate  shipping  scale  economies  !  Short  lead  Fme  

4.  Barging  into  Deep  Water  

!  Moderate  capital  cost  !  High  operaFng  cost  !  High  shipping  scale  economies  !  Moderate  lead  Fmes  

Flinders Ports Projects Iron Ore

Port  Pirie  Flinders  Ports  

Barge  

Port  Bonython  Flinders  Ports  

Bulk  

Myponie  Point  Braemar  Group  

Bulk  Sheep  Hill  

Centrex  Bulk  

Lucky  Bay  Iron  Clad  Barge  

Cape  Hardy  Iron  Road  

Bulk  

Adelaide  Flinders  Ports  Containers    

Ship  Loader  

Bonython  Bulk  Port  Concept  

•   Common  User  Facility  •   20m  water  depth  •   New  jedy  access  structure  •   Independent  mooring  &        material  handling  

New  Jegy  

Bonython  Jegy  Concept  

Bonython  Iron  Ore  Project  -­‐  Key  Issues  

•  Global  Iron  Ore  Market  –  Price,  Demand,  Supply  

•  Available  Volumes  and  Timing  

•  Industry  support  •  Government  Support  •  Infrastructure  –  Port  &  Rail  •  OperaKons  –  Port  &  Rail  •  Triple  Bodom  Line  impacts  -­‐  EIS  Approval  pending  

•  Development  Kmetable  

•  Funding  structure  •  Financial  feasibility  •  Commercial  Structure  &  DocumentaKon  

ContainerisaFon  -­‐  Iron  Ore  Interim  SoluFon  -­‐  

The  thought  process:  

–  How  do  we  maximise  shipping  scale  economies  (big  ships)  whilst  minimising  capex  ?  

–  Need  an  exisKng  berth  with  spare  capacity  and  deep  water  –  The  outer  harbour  container  terminal  is  the  only  berth  with  reasonably  

deep  water  and  spare  capacity  

–  But  given  the  adjacent  cargoes  any  dust  is  unacceptable  

The  Challenge:  A  dust  free  process  through  the  container  terminal  

An  Environmentally  Sound  SoluFon  

Number of Material Transfer Points

1. Open stockpiles with front end loader into a hopper loading a conveyor ship loader.

2. Stored in containers, tipped into a hopper loading a conveyor ship loader.

3. Stored in containers (4 high) and loaded direct from containers by tippler system.

Discharge container into stacker hopper

Tele-stacked into stockpile (profile stockpile)

FEL operation between stockpile & reclaim hopper

FEL dumping into reclaim hopper

Convey material to ship-loader

Transfer hopper at base of ship-loader

Convey up ship loader

Discharge in hold

FEL = Front End Loader

Tarcoola  

Adelaide  

Containerisation - IMX

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Loading Method

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The  system,  developed  by  Flinders  LogisFcs,  agracted  interest  from  all  over  the  world  because  of  its:  

" Low  capital  costs  –  no  need  for  sheds  (the  containers  are  the  shed)  " Efficient  rail  transportaKon  " ExcepKonal  environmental  performance  –  a  dust  problem  solved  " With  the  addiKon  of  lids  -­‐  Complete  containment  –  no  loss  of  high  

value  cargo  " Reasonable  operaKonal  cost,  given  the  high  value  of  the  

environmentally  sensiKve  cargoes  " Short  lead  Kme  for  commencement  

The Flow On Impact

Rail

Broken Hill

Port Lincoln

Port Bonython Royal Resources

Havilah Lilydale

Havilah Maldorky

Carpentaria

Mines

Tarcoola

IMX Export 10 mtpa

Stella Resources

Export 30 - 40 mtpa

Barging - Port Pirie

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Port  Pirie  Flinders  Ports  

Barge  

Rail discharge and ore stockpile area

4km conveyor along existing rail corridor

Barge loading facility at Berth 7

ARTC Network

SPENCER GULF

Spencer Gulf Barge Operation

30kms west of Port Pirie

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Iron Ore Barging – Port Pirie Capacity 20m+ tonnes per year

Port Adelaide – Berth 29 Development Plan

Actual  September  2014  Concept  Plan  2007  

Combined Mining/Materials Handling & Storage Strategy

Safe

Sound &

People

Environment

Flinders Logistics

Flinders Logistics Berth 29 Operation

Container  laydown  Hillgrove  

Container  laydown  OZ  Minerals  

Ship  Loading  

Equipment  2  x  Crane    3  x  Crane  Tipplers  1  x  Ship  Tippler  5  x  45t  Reach  Stackers  2  x  16t  Fork  Lics  5  x  Terminal  Tractors  3  x  Double  20”  Trailers  2  x  Triple  Trailers  

Container  laydown  Cristal  Mining  

Rail  Intermodal  

Office  

Rail  

The  project  required  the  design  and  fabricaKon  of:  •  Truck  planorms  with  guard  rails  for  the  safe  slinging  of  the  bags  •  Bag  spreader  that  has  remote  air  release  hooks  which  can  release  the  bags  with  workers  at  a  safe  distance  whilst  in  the  hold  of  the  vessel  

Flinders Logistics Port Pirie Bulka Bag Operations

Flinders Adelaide Container Terminal Growth • GDP/GSP • China and the region • Continuing move to containerisation • Reduced rail use between Melbourne and Adelaide and increasing confidence in transhipment • More liner calls attracted to higher volumes exchanges

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Empty  (TEU's)   Full  (TEU's)   Annual  Growth  

TEU's  

TEU  Growth  –  FY2004  to  FY2014    (Average  annual  growth  in  the  order  of  12.0%)  

•  Channel  Deepened  to  14.2m  or  16.2m  with  Kde  –  Cost  $45m,  Completed  in  2006  

•  Berth  Extended  by  150m  to  650m  –  Cost  $14m  –  Completed  in  2009  •  Hard  stand  increased  by  26,000m2  –  between  2010/14,  Cost  $8m      •  Hard  stand  increase  underway  –  CompleKon  in  2015  •  New  post  Panamax  crane  (ZPMC)  –  Cost  $14m  –  Commissioned  2010  •  2  new  post  Panamax  cranes  (Liebherr)  –  Cost  $26m,  Due  early  2015  

Flinders Adelaide Container Terminal Improvements

Video