Caltex inks $200m Roy Hill deal

Mining project gets a step closer with two-year contract to supply fuel.

Caltex Australia (CTX) has signed a $200 million deal to supply diesel fuel to Gina Rinehart's pet project, the Roy Hill iron ore mine.

Caltex Australia will begin its two-year contract to supply fuel to Australia's largest mining project in Western Australia's Pilbara region today.

Executive Phil Amos said Caltex would supply about 120 million litres of diesel over the course of the contract during the start-up phase and as production is expanded.

A fleet of four dedicated road trains will transport fuel 400km by road from Port Hedland.

The signing of the Caltex contract is the latest step in Ms Rinehart's plan to get the Roy Hill mine up and running.

The project secured a $7.2 billion funding package from an international consortium of 19 banks, including Australia's big four lenders in March and struck a $136 million deal with UGL to supply electricity in April.

It is expected to employ up to 3,600 people during construction, and a further 2,000 staff once operations start.

The mine predicts it will export its first iron ore in 2015 and is targeting annual production of 55 million tonnes.

InvestSMART FORUM: Come and meet the team

We're loading up the van and going on tour from April to June, with events on the NSW central & north coast, the QLD mid-north coast and in Perth, Adelaide, Melbourne, Sydney and Canberra. Come and meet the team and take home simple strategies that you can use to build an investment portfolio to weather any storm. Book your spot here.

Want access to our latest research and new buy ideas?

Start a free 15 day trial and gain access to our research, recommendations and market-beating model portfolios.

Sign up for free

Related Articles