The WA state government accepted an Esperance Port Authority board recommendation to start a search for a private sector consortium to design, finance, construct and operate a multi-user iron ore facility.

Buswell said the decision would facilitate growth in the Yilgarn region’s iron ore sector.

The project will move to the next stage of development, with potential proponents invited to apply for prequalification to participate in a request for proposal process.

The government expects to identify the preferred proponent later this year.

“All project funding and associated costs will be the responsibility of the private sector proponent ultimately selected through the RFP process,” Buswell said.

The port has an operating licence to handle 11.5 million tonnes per annum of iron ore but the Port Authority said a market sounding exercise showed it might be commercially viable to develop a facility for an additional 10-12Mtpa.

The Yilgarn Iron Producers Association, a group of iron ore miners and hopefuls including Mindax, Mineral Resources, Radar Iron and Cazaly Resources, has been pushing for the expansion for months.

A study conducted by YIPA showed that the port upgrade would provide employment for up to 1000 workers during construction, with a yearly direct employment for up to 360 people during mine operation.

YIPA chairman and Radar Iron managing director Jon Lea said a modestly priced upgrade to provide an additional 10Mtpa capacity costing around $A200 million was the way forward.

“The additional 10Mtpa mining capacity and an upgraded port to export this will be a major boost to the Goldfileds Esperance economy and Western Australia,” Lea said.

“Ninety-five million dollars in royalties to the state government will flow as well as significant jobs during construction and operational phases.”

Cazaly joint managing director Clive Jones said the company welcomed the decision and hoped it signalled a greater determination by the state government to push ahead with the development of iron ore facilities at Esperance in short order.

“Our Parker Range iron ore project has been waiting for some time for a viable Esperance port solution so it can be advanced to a development phase,” Jones said.

“While we’ve been waiting for the state government to make a clear decision on Esperance, we’ve had to investigate other export options.

“Esperance remains our preferred port solution but if Esperance isn’t developed in time we may have to look elsewhere.”

The size of the new facility will be determined by the entity building the infrastructure after entering into contracts with miners.

The market sounding exercise also confirmed previous industry studies that iron ore production in the Yilgarn could significantly grow in the next 10-15 years.

The government will accept applications from interested parties until March 1.