Fortescue Metals Group Ltd (ASX: FMG) is back in the headlines with news it is considering a pivot-shift in strategy regarding its magnetite operations at its Iron Bridge project.
At the time of writing, shares in the iron ore juggernaut are changing hands at $21.07 apiece, up 3.44%, after closing the session at $20.37 last Friday.
The gain is supported by broad sector strengths on Monday, with the S&P/ASX 300 Metals & Mining Index (ASX: XMM) jumping 1.47% from the open at the time of writing.
Aside from this, iron ore price action remains under considerable pressure since its selloff in mid-July. Spot and futures prices have melted more than 45% since then.
What's up with the Fortescue share price today?
Shares in the iron ore giant opened the session down at $19.83 apiece after pre-market activity on Monday, despite no price sensitive information being released.
However, the Fortescue share price spiked on the opening bell and is now trading well in the green, amid news of a shifting strategy at its Iron Bridge magnetite mine in WA.
According to reporting from The Australian, the company is understood to have already commenced works at the site using its own fleet. However, it is now facing a blowout of up to $1.2 billion in costs and capital expenditures at Iron Bridge.
The revision on expenses comes after labour costs and foreign exchange rates had already pushed maiden production at the site back by 6 months, according to the company.
Now Fortescue says the project is on schedule to deliver first production in December 2022 with revised capital investment forecasts of $US3.3-$US3.5 billion.
As such, it is reported the company is seeking a third-party contractor to overtake long-term mining operations at the site, as Fortescue itself seeks to minimise spending on diesel trucks in its push towards renewables.
Doing so would free up capital from its expense base and allow for a reallocation towards its renewables division.
Fortescue has made the commitment to divest completely from diesel trucks by 2030, amid Fortescue Future Industries' quest to unlock the latest sustainable energy source.
Fortescue founder Andrew 'Twiggy' Forrest has also been lobbying hard for the government to phase out the US$7.8 billion diesel fuel rebate by 2025, The Australian reports.
The news follows a media update out of Fortescue's camp last week, saying it had purchased two new "battery electric locomotives" to transport its iron ore to port.
The new locomotives are set to "cut emissions while also reducing fuel costs and [its] overall operational expense through lower maintenance spend".
As it stands, Fortescue has been more active than usual lately on managing its portfolio and aiming to reduce exposure to 'non-green' fuel and energy sources such as diesel.
Aside from the above, Fortescue now has to fill the positions of a number of senior executives who have left the company in recent months, including its director of energy and chief executive.
Separately, iron ore markets have been lumpy since September 2021 and have traded largely sideways since that time.
Whilst traders have shown support for iron ore lately, it has faced resistance on several occasions at the US$121-$125/tonne mark and can't seem to breakout past that point.
Fortescue Metals share price snapshot
It's been a difficult year for Fortescue shareholders, having lost around 17% in the last 12 months of trading. However, the company's shares have started the year well and are up 9% to date.
In the last month, Fortescue has regained support and has climbed almost 15% into the green, amid a slew of updates and the price of iron ore bouncing off its 52-week lows in December.
