The Australian iron ore producer Fortescue Metal Group Ltd (Fortescue) intends to use its growing cash flow to increase its iron ore production capacity up to 80 million mt per year by 2009.
"The free cash flow of an 80 million mt operation will be in excess we think of about AU$5 billion a year,'' Fortescue's CEO Andrew Forrest stated.
Currently, Fortescue is working towards achieving its initial production targets of 45 million mt of iron ore per year by November this year and 55 million mt per year by the first quarter of 2009.
Within the scope of its plan, Fortescue intends to complete the rail extension from its Cloudbreak to Christmas Creek operations and to build a second export harbor to meet the increasing demand from Chinese steelmakers.
Recently, Fortescue's total reserve estimate at its Cloudbreak and Christmas Creek projects has increased by 54 percent from earlier estimates to 1,625 million mt.
With the regard to the future, Fortescue plans to raise its annual iron ore production capacity to 320 million mt by 2012, rising eventually to 420 million mt.