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Fortescue commits $2b to Iron Bridge, WAE

Fortescue

Fortescue Metals Group has sold $US1.5 billion ($2 billion) in senior notes to support its sustainability push and Iron Bridge magnetite project in Western Australia.

The major miner will commit $US800 million ($1.07 billion) to its decarbonisation initiatives, including the 150-megawatt solar generation component of the Pilbara Energy Connect (PEC) project, the acquisition of Williams Advanced Engineering (WAE) and the Christmas Creek hydrogen mobility project.

The remaining $US700 million ($936 million) will be available to fund Iron Bridge, a project which it shares in a joint venture with Formosa Steel and is slated for first production in December.

Fortescue aims to produce 22 million tonnes per annum of a high-grade (67 per cent iron) magnetite concentrate product from Iron Bridge.

The company completed a technical and commercial assessment of Iron Bridge in May 2021, which resulted in a revised cost of up to $US3.5 billion ($4.7 billion) for the project.

Fortescue chief executive officer Elizabeth Gaines said the senior note offering was further consolidation of the company’s commitment to decarbonisation.

“Fortescue’s sustainability financing framework recognises the global growth in sustainability and green sources of capital,” she said.

“The successful completion of Fortescue’s inaugural green financing offering demonstrates the company’s passion and commitment to integrate sustainability into all aspects of our business, as we take a global leadership position in the green energy transition.”

Spanning a 10-year term, the $US800 million facility will bear an interest rate of 6.13 per cent, while the $US700 million facility will carry an interest rate of 5.88 per cent across an eight-year term.

Fortescue’s sustainability objectives also include the development of a regenerating battery-electric iron ore train project in collaboration with WAE.

The Infinity Train will utilise the gravitational energy generated on the downhill loaded sections of Fortescue’s rail network to recharge its battery-electric systems, without any additional charging requirements for the return trip to reload.

The self-sustaining system will increase operational efficiency, lower maintenance costs, and eliminate diesel and the associated CO2 emissions from Fortescue’s iron ore trains.

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