China's TMI restarts Woodie Woodie mine (I)

Published on 2017-08-28

The mothballed Woodie Woodie manganese mine in Western Australia will be restarted before the end of the year by its new Chinese owner, which says it has an appetite for further growth in Australia.

China's Ningxia Tianyuan Manganese Industry Company (TMI) will spend about $30 million to restart the Pilbara mine, which was put on care and maintenance when the price for manganese ore plummeted to about $US1.80 a dry metric tonne unit in February 2016.

At that time, Woodie Woodie was owned by Consolidated Minerals, itself controlled by Ukrainian billionaire Gennadiy Bogolyubov.

Mr Bogolyubov paid a top-of-the-cycle price of $1.2 billion to take over ConsMin in 2007. He sold the company to TMI in November 2016 for an undisclosed sum.

On a trip to Perth to visit the project and meet with local stakeholders, TMI founder and chairman Tianjiang Jia told The Australian Financial Review the restart was driven by the company's confidence in improved market conditions.

The price for 44 per cent manganese ore is now around $US6 per dry metric tonne unit.

TMI is the world's biggest producer of electrolytic manganese metal (EMM). About 10 per cent of global manganese supply goes into the production of EMM, a form of manganese predominantly used in the steel industry.

"Woodie Woodie, as well as ConsMin, forms part of TMI's international strategy," Mr Jia said, via a translator.

"We have a positive view on Australia, particularly Western Australia, as an investment environment and we have the confidence the market will be positive so we have made our commitment to open the operation and increase investment."

TMI was ConsMin's biggest customer before the acquisition and Mr Jia said his rationale for taking over the company was largely "to make sure Woodie Woodie can continue to supply and make sure production is stable."