Isa project takes great leap forward

TONY RAGGATT

March 23rd, 2010

LARGE Chinese fertiliser manufacturing group Wengfu has reported positively on prospects for a giant phosphate project for northwest Queensland, according to development company Legend International Holdings.

Legend, led by Melbourne mining magnate Joe Gutnick, has reported on the latest milestones for the project under which phosphate products worth $2 billion a year would be exported from Townsville.

Technical experts from Wengfu recently visited Townsville Port and northwest Queensland as part of a strategic alliance the company has formed with Legend to develop a phosphate mine, beneficiation plant, phosphoric acid plant and potential di-ammonium and mono-ammonium (DAP/MAP) phosphate plant in the Mount Isa region.

On completion of a positive feasibility study - expected in the second quarter of this year - Legend says Wengfu will become an equity partner and assist with obtaining further finance options for the project.

''Legend and Wengfu have agreed to work together on the feasibility study initially for the mining, beneficiation, phosphoric acid production and potential DAP/MAP production from phosphate rock,'' the US-listed company reported to the US Securities and Exchange Commission.

''The Wengfu delegation reported that they have a very positive view on the project based on their findings to date.

''These findings are preliminary in nature and will be concluded upon completion of the detailed feasibility study, due quarter two, 2010.''

Representatives of another strategic partner to the project, the Indian Farmers Fertiliser Co-operative, and India's Minister of Fertilisers and Chemicals, M.K. Alagiri, will meet with Queensland Government representatives in Brisbane today.

The State Government has reserved about 300ha of land suitable for the development of a phosphoric acid plant about 5km south of Mount Isa.

The site abuts the Mount Isa to Townsville railway line and is adjacent to the Mica Creek and Xstrata power stations.

The Department of Infrastructure and Planning has engaged lawyers to draft documents for sale of the land to Legend, pending a positive feasibility study, the company says.

Legend had said it planned to begin phosphate concentrate exports from Townsville this year, but it now says Wengfu's findings and expert knowledge suggest Legend should consider a company-owned phosphoric acid plant at Mount Isa.

''Based on Wengfu's recommendations, a revised project timeline will be re-issued upon completion of the feasibility study,'' the company says.