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Key points
- Mineral Resources share price rises on government announcement
- Potential to significantly increase iron ore shipments
- Joint venture partners yet to make final investment decisions
The Mineral Resources Limited (ASX: MIN) share price is up 3.19% in late morning trade to $59.23 per share.
Below we take a look at the company's update on its iron ore capacity allocation at the Port of Port Hedland.
How has the capacity allocation changed?
The Mineral Resources share price is lifting after the company reported that the government of Western Australia will increase iron ore export capacity at the Port of Port Hedland.
The government will also provide a new capacity allocation at Stanley Point berth 3 (SP3).
Should all the necessary approvals be obtained, this will be allocated to the joint venture between Hancock Prospecting and Mineral Resources. According to the release, those approvals should be finalised by mid-year.
The joint venture, announced on 29 November, will see the two companies investigate the joint development of a new iron ore export facility at SP3. Both companies still need to make a positive final investment decision to continue with the project after completing an expedited feasibility study.
Commenting on the announcement, Mineral Resources managing director Chris Ellison said:
Today's announcement is a key milestone in MRL's strategy to unlock stranded deposits in the Pilbara by developing pit-to-port solutions and expanding our capability to be a long-term, low-cost sustainable supplier of iron ore to international markets.
We acknowledge the extensive consultation and review work completed by the Minister for Ports, Rita Saffioti, and the team at the Pilbara Ports Authority to ensure the Port Development Plan maximises exports and advances industry growth, which will lead to thousands of jobs for Western Australians for years to come.
If SP3 is developed as planned, Mineral Resources says it intends to ship at least 20 million tonnes of iron ore per annum.
Mineral Resources share price snapshot
The Mineral Resources share price is up 62% since this time last year, compared to a 12-month gain of 4% posted by the S&P/ASX 200 Index (ASX: XJO).
So far in 2022 Mineral Resources shares have gained 5%.
