WA Mines Department orders $6m guarantee from Mineral Resources to underwrite Yilgarn hub clean-up

Mineral Resources is on the hook for new security bonds totalling about $6m following a State Government probe into cleanup costs at mined-out iron ore land the company recently flogged off. The Department of Mines, Petroleum and Exploration had been reviewing the tenements that previously housed MinRes’ now-shuttered Yilgarn iron ore hub as part of a recent sale for an “immaterial sum” in June. The deal followed the Chris Ellison-led miner’s decision to wind up operations at the Koolyanobbing, Parker Range, Carina and Windarling mines at the end of 2024 when it was deemed “not financially viable” to keep mining. But a crew of local mining executives under the banner of Yilgarn Iron Investments seemingly see value in the Goldfields land. They plan to optimise “existing resources while exploring for the next generation of iron ore projects”, according to a recently revamped website. YII previously indicated it wanted to “operate and progressively rehabilitate” the sprawling precinct with a view to restart haulage and mining operations by the end of this year. The State Government, however, appeared to be concerned about who would pay for cleanup and rehabilitation liabilities, and in July confirmed to The West Australian that it was conducting a security review over the tenements. The cash for the additional bonds, which are predominantly linked to the Koolyanobbing and Windarling mines, is set to be fronted by a bank before the end of this month with MinRes underwriting the full sum. A DMPE spokeswoman said its security review had “addressed the level of implementation of closure preparedness activities given the advanced life of the mine” and resulted in approximately $6m of bonds being imposed on the hub. As part the sale deal with YII, Mineral Resources passed on all environmental, closure and rehabilitation costs across the Yilgarn hub, which the miner revealed in its latest financials would be about $51m. Australian Securities and Investments Commission documents show YII applied to be registered as a business in April. Subicao-based YII is majority-owned by Maiden Iron director Fergus Campbell, while David Paull — the other director of Maiden Iron — also has a large YII stake. Maiden Iron owns three iron ore tenements in the Pilbara, which it picked up in 2013. Geologist Neil Lithgow, former Brierty chief executive Peter McBain and liquidator Ross Thomson are all minor shareholders of YII. MinRes took control of the Yilgarn hub in 2018, but only after securing a five-year agreement with the McGowan Government to pay no royalties on the iron ore extracted and ship about 6 million tonnes of ore through Esperance Port at a discounted rate. The labour-intensive operation employed more than 1000 people at its peak after being revived by MinRes.