Logistics Of Iron Ore Transportation Cilt

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Presentation on current modes of ironore transportation in India,Challenges and opportunities. Presentation made in a seminar conducted by Chartered Institute of Logistics and Transportation, London held at New Delhi in December,2008.

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  • IF ANY ONE HAS BEST OFFER FOR IRON ORE TRANSPORTATION WITH ORIGINAL RATE CONTACT DIRECTLY ON 08983770807.FROM, DEEKAY GROUP.
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  • Logistics Of Iron Ore Transportation Cilt

    1. 1. LOGISTICS OF IRON ORE TRANSPORTATION IN INDIA ISSUES & CHALLENGES KK KUMAR VICE PRESIDENT – MARKETING & LOGISTICS MSPL LIMITED, HOSPET, KARNATAKA
    2. 2. OVER VIEW OF IRON ORE INDUSTRY - GLOBAL <ul><li>IRON ORE IS A KEY RAW MATERIAL FOR STEEL MAKING </li></ul><ul><li>WORLD PRODUCTION OF IRON ORE IS 1.60 BILLION MT IN 2007 </li></ul><ul><li>IN LINE WITH THE GLOBAL STEEL BOOM, IRON ORE PRODCTION HAS INCREASED SEQUENTIALLY FOR 6 STRAIGHT YEARS </li></ul><ul><li>BRAZIL, CHINA, AUSTRALIA AND INDIA ARE THE LEADING PRODUCERS (2007) </li></ul><ul><ul><li>BRAZIL 336.50 MILLION MT </li></ul></ul><ul><ul><li>CHINA 332.30 </li></ul></ul><ul><ul><li>AUSTRALIA 299.10 </li></ul></ul><ul><ul><li>INDIA 206.90 </li></ul></ul><ul><li>GLOBAL SEA TRADE IN IRON ORE IS ALSO DOMINATED BY ABOVE COUNTRIES </li></ul><ul><li>TOTAL GLOBAL TRADE IN IRON ORE BY SEA REACHED 822.40 MILLION MT IN 2007 </li></ul>
    3. 3. GROWTH IN GLOBAL SEA BORNE IRON ORE TRADE AND LONG TERM BENCHMARK PRICE
    4. 4. OVER VIEW OF IRON ORE INDUSTRY - GLOBAL <ul><li>MAJOR IRON ORE EXPORTING COUNTRIES (2007) </li></ul><ul><ul><li>BRAZIL 269.40 MILLION MT </li></ul></ul><ul><ul><li>AUSTRALIA 266.80 </li></ul></ul><ul><ul><li>INDIA 93.70 </li></ul></ul><ul><li>MAJOR IRON ORE IMPORTING COUNTRIES (2007) </li></ul><ul><ul><li>CHINA 383.10 MILLION MT </li></ul></ul><ul><ul><li>JAPAN 138.90 </li></ul></ul><ul><ul><li>GERMANY 46.20 </li></ul></ul><ul><ul><li>S.KOREA 46.20 </li></ul></ul><ul><li>CHINA IS A MAJOR DRIVER OF IRON ORE TRADE DUE TO ITS GLOBAL # 1 POSITION AS STEEL PRODUCER </li></ul><ul><li>CHINA ACCOUNTS FOR NEARLY 47% OF GLOBAL IRON ORE SEABORNE IMPORTS </li></ul><ul><li>CHINA’S STEEL PRODUCTION AT 489 MILLION MT ACCOUNTS FOR 36% OF GLOBAL STEEL PRODUCTION OF 1344 MILLION MT. </li></ul>
    5. 5. DOMINANT ROLE OF CHINA IN GLOBAL STEEL PRODUCTION
    6. 6. TREND IN PRODUCTION & EXPORTS OF INDIAN IRON ORE 104.00 93.79 89.27 78.14 62.57 48.02 41.64 37.49 32.91 31.27 35.61 31.70 Exports 206.90 172.00 155.00 142.70 122.80 99.07 86.22 73.21 74.94 70.68 75.72 66.60 Production 2007 2006 2005 2004 2003 2002 2001 2000 1999 1998 1997 1996 Year
    7. 7. INDIAN IRON ORE PRODUCTION DRIVEN BY EXPORT GROWTH
    8. 8. INDIA’S RESERVES & PRODUCTION ADEQUATE FOR DOMESTIC AND EXPORT MARKETS Estimate
    9. 9. COUNTRY WISE EXPORTS OF IRON ORE FY 2000-01 FY 2007-08 37.3 Mt 104 Mt
    10. 10. <ul><li>IRON ORE LOGISTICS </li></ul><ul><li>MODE WISE ANALYSIS </li></ul>
    11. 11. LOCATION OF IRON ORE MINES
    12. 12. DESTINATION OF IRON ORE <ul><li>DOMESTIC IRON & STEEL PLANTS ( INCLUDING SPONGE/PIG IRON PLANTS ) </li></ul><ul><li>EXPORTS </li></ul>
    13. 13. MAJOR MODES OF TRANSPORT OF IRON ORE <ul><li>RAILWAY </li></ul><ul><li>ROAD </li></ul><ul><li>WATER WAYS-(GOA) </li></ul><ul><li>COASTAL SHIPPING </li></ul><ul><li>PIPE LINE (KIOCL / ESSAR) </li></ul>
    14. 14. RAIL TRANSPORTATION
    15. 15. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Most commonly used mode for iron ore </li></ul><ul><li>As per latest railway statistics of 2006-07, iron ore is the second largest commodity moved by rail accounting for 16% of total traffic. ( Coal is #1 with 43% share) </li></ul><ul><li>116 million mt of iron ore was moved in 2006-07 which includes 38.84 million mt of iron ore for export </li></ul><ul><li>Iron ore is moved from mines to steel plants/ sponge iron plants / pig iron plants and ports </li></ul><ul><li>Most of the traffic to steel plants is on priority and programmed </li></ul><ul><li>Domestic rail freight for iron ore is charged at lower class (170 class) as compared to iron ore for export ( 200x) </li></ul>
    16. 16. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 1 </li></ul><ul><li>Inadequate rail capacity for both domestic steel plants and also for exports. </li></ul><ul><ul><ul><li>Large number of indents pending ( recent past few months is an exception due to global slowdown) </li></ul></ul></ul><ul><ul><ul><li>Iron ore miners forced to move by road </li></ul></ul></ul><ul><ul><ul><li>Mismatch of steel plants requirements and what railways can offer </li></ul></ul></ul><ul><ul><ul><li>Sharing of railway line for both passenger and goods results in priority for passengers thereby delays and congestions for goods traffic </li></ul></ul></ul><ul><ul><ul><li>Low average speed of freight traffic leads to longer lead times and reduced throughput through ports as time taken for convergence of cargo is long </li></ul></ul></ul>
    17. 17. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 2 </li></ul><ul><ul><li>Lower Haulage capacity leading to higher lead time </li></ul></ul><ul><ul><ul><li>Lower axle load and lower payload to tare weight ratio restricts quantity hauled. </li></ul></ul></ul><ul><ul><ul><ul><li>Current axle load ranging from 20-23 mt/axle. Need to increase to 25mt or more for hauling more quantity / rake </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Current tare weight to pay load ratio is 1: 2.7 </li></ul></ul></ul></ul><ul><li>Designing / modifying tracks and rolling stock to higher axle load will increase throughput </li></ul><ul><li>Usage of lighter material like steel in place of iron for rolling stock could increase tare to pay load ratio to 1: 3.4 thereby increasing quantity hauled/rake </li></ul>
    18. 18. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 3 </li></ul><ul><ul><li>Policy of Higher freight for goods by cross subsidizing freight </li></ul></ul><ul><ul><li>earnings for passenger traffic </li></ul></ul><ul><ul><li>Iron ore for export being specially targeted for frequent hikes making logistics costs exorbitant by rail as compared to road. </li></ul></ul><ul><li>Eg: Hospet – Chennai Rail ( 576 km) freight 200x (before 8-11-08)=Rs 1781.55 </li></ul><ul><ul><li>Hospet –Chennai Road Freight = Rs.1100.00 </li></ul></ul><ul><ul><li>In India rail transport cost USD 6/mt for 100 km distance </li></ul></ul><ul><ul><li>In Australia USD 1.125/mt for 100 km distance </li></ul></ul><ul><ul><li>i.e about 500% more !! </li></ul></ul>
    19. 19. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><ul><li>Due to drastic fall in export prices of iron ore in post August 2008, the high cost of railway freight resulted in massive cancellation of indents. </li></ul></ul><ul><ul><li>In SWR indents pending as on May, 2008 were 19,350. </li></ul></ul><ul><ul><li>By September, they dropped to 706 </li></ul></ul><ul><ul><li>On October 3 rd , pending indents were just 8. </li></ul></ul><ul><ul><li>( Freight discounts were announced on 8-11-08 by railways) </li></ul></ul>
    20. 20. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 4 </li></ul><ul><li>Frequent Changes in rail freight of iron ore – constraint for long term planning and fixing modal mix. </li></ul><ul><li>From 1-4 - 2007, iron ore freight for export has changed 10 times. </li></ul><ul><li>This leads to great uncertainty in budgeting and long term planning. </li></ul>
    21. 21. Distance based freight concession on NTR /subject to minimum NTR at 350 Kms 38 0.00 0.00 1180.13 200x 08.11.08 11 Busy season surcharge 7 % levied 92 6.50 72.07 1180.13 200 X 01.10.08 10 Busy season surcharge 7 % discontinued (removed) 40 -6.11 -72.07 1108.06 200X 01.07.08 9 Iron Ores charged at class -- 200 X and port congestion charges abolished 51 26.72 248.81 1180.13 200 X 22.05.08 8 Iron Ores charged at class --180, port congestion charges increased to 100% from 60% 85 27.81 202.67 931.32 180 01.04.08 7 Iron Ores charged at class --170 37 5.52 38.15 728.65 170 07.01.08 6 In addition to busy season surcharge of 7 %, port congestion charge of 60% introduced ( ie total 67% introduced) 61 15.25 91.39 690.50 160 01.12.07 5 Busy season surcharge 7 % and port congestion charge 35% total 42% introduced 61 10.08 54.84 599.11 160 01.10.07 4 Terminal charges of Rs. 10 per ton for each terminal (Rs. 20) is changed as Rs. 40 per terminal (i.e., Rs. 80) 31 12.39 60.00 544.27 160 01.08.07 3 2% Development surcharge on NTR & @ Rs. 10 per ton as terminal charges for each terminal i.e., Rs. 20 per ton 91 6.39 29.10 484.27 160 01.07.07 2 Busy season surcharge 6 % and port congestion charge 21% total 27% introduced   -1.32 -6.09 455.17 160 01.04.07 1 Remarks Days since last change Percentage Diff. Ft. Ft. per Ton Class Year Sl. No HOSPET TO GOA (SVM) RAILWAY FREIGHT - DISTANCE 343 KM.
    22. 22. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 5 </li></ul><ul><li>Threat of exorbitant Punitive charges for overloading leads to under loading of rakes and thus loss due to dead freight payment. </li></ul><ul><li>Present system loaded against rail consumer as no weighing facility exists at the time of loading. </li></ul><ul><li>- Rakes loaded as per Weight-Volume ratio </li></ul><ul><li>- Rakes weighed on in-motion weighbridges for excess loaded wagons </li></ul><ul><li>- Eg. Hospet-Goa </li></ul><ul><li> Normal Freight = Rs. 1100.13 /mt </li></ul><ul><li> Punitive Charge= Rs 3235.68/mt ~Rs. 5392.80 /mt </li></ul>
    23. 23. RAIL TRANSPORTATION ISSUES & CHALLENGES <ul><li>Challenge # 6 </li></ul><ul><li>Lack of rail connectivity to ports and long time lines for rail projects. </li></ul><ul><ul><ul><li>Absence of connectivity forces use of road alternative </li></ul></ul></ul><ul><ul><ul><li>Slow pace of implementation of rail projects. </li></ul></ul></ul><ul><ul><ul><li>This forces iron ore miners to go for long distance ports increasing costs and reducing competitive advantage </li></ul></ul></ul>
    24. 24. POSSIBLE SOLUTIONS TO CHALLENGES <ul><li>Examining Axle load increase to 25 mt </li></ul><ul><li>Expediting East – West rail corridor by line doubling between Goa – </li></ul><ul><li>Chennai and implementing port connectivity projects on priority. </li></ul><ul><li>Expediting facilities for manufacture of higher axle load wagons , new </li></ul><ul><li>technology bogies , couplers , draft gears and other equipment to get </li></ul><ul><li>rolling stock suitable for 30.0 - 32.5 Tonne axle load . </li></ul><ul><li>R ailways to expedite use of stainless steel wagons to improve the pay </li></ul><ul><li>load to tare weight ratio. The ratio will improve to 3.4 from the present </li></ul><ul><li>2.7 </li></ul><ul><li>Evolving win-win mechanism for accurate loading of rakes to avoid </li></ul><ul><li>both punitive charges and dead freight at the same time ensuring </li></ul><ul><li>safety to track and rolling stock </li></ul><ul><li>Stable freight regime instead of frequent changes </li></ul><ul><li>Realistic freight rates on sustainable basis instead of current “milking </li></ul><ul><li>the cow” approach for iron ore. </li></ul>
    25. 25. ROAD LOGISTICS
    26. 26. ROAD LOGISTICS <ul><li>INDIAN ROAD NET WORK </li></ul><ul><ul><li>About 65 % of all freight and 80 % of passenger traffic is carried by the Road. </li></ul></ul><ul><ul><li>National Highways account for only about 2 % of the Road Network but carry about 40 % of traffic. </li></ul></ul><ul><ul><li>Four lane 12 % ,Double lane 56 % and Single lane 32 % </li></ul></ul><ul><ul><li>Number of vehicles have been growing at an average pace of 10.16 % per annum . </li></ul></ul>
    27. 27. ROAD LOGISTICS - CHALLENGES <ul><li>Most of the highways are narrow and congested. </li></ul><ul><li>Some of them do not even have two lanes. </li></ul><ul><li>Surface quality is poor. </li></ul><ul><li>Road maintenance remains under funded – only around one–third of maintenance needs are met </li></ul><ul><li>Lack of organized fleet owners leading to lower professionalism. 67% of truck owners own less than 5 vehicles </li></ul><ul><li>Industry status not accorded to road transport operators </li></ul><ul><li>No access to low interest rate funds for investment </li></ul><ul><li>THIS LEADS TO : </li></ul><ul><li>Low speed of average 30 – 40 KMPH . </li></ul><ul><li>Pollution problems </li></ul><ul><li>Costly maintenance of vehicles </li></ul><ul><li>Higher costs and therefore higher freight rates </li></ul><ul><li>Higher turnaround time </li></ul><ul><li>Long lead time for cargo convergence </li></ul><ul><li>Issues of reliability , cargo integrity etc. </li></ul>
    28. 28. ROAD LOGISTICS POSSIBLE SOLUTIONS TO CHALLENGES <ul><li>Govt. focus on infrastructure creation, especially roads. </li></ul><ul><li>Increasing PPP projects </li></ul><ul><li>Policy encouragement for organized players to enter and expand in logistics space and offer integrated solutions. </li></ul><ul><li>Reviewing numerous state and local laws/ taxes that not only add costs but lead to delays. </li></ul><ul><li>Development of high load carrying roads, vehicles will enable movement of higher quantity per vehicle as is done in some developed countries. </li></ul>
    29. 29. PORTS
    30. 30. PORT INFRASTRUCTURE- CHALLENGES <ul><li>In almost all the iron ore ports the loading is a mixture of mechanical loading system ( conveyors - stacker-reclaimers & ship loaders ) and manual loading process ( using either shore cranes or ship's gear & grabs ) . </li></ul><ul><li>The mechanical iron ore loading plants available only in Mormugao ( Goa) , Chennai,, Vizag. Even some of these systems are old and do not operate at full capacity. </li></ul><ul><li>Paradip & Haldia systems are more than 25 years old and need replacements to improve productivity. </li></ul><ul><li>Therefore frequent breakdowns / repairs delay the turn round of the vessels and thus lead to congestion . </li></ul><ul><li>In manual berths virtually in all the ports no suitable cranes are available . Hence geared grabber vessels are necessary at all the ports where manual loading is done . </li></ul><ul><li>Only Vizag and Chennai ports can load alongside berths cape vessels upto 145,000 - 150,000 DWT with draft of about 16.5 M . </li></ul><ul><li>In Goa at Berth No. 9 cape size vessel can load only upto 100,000 MT to reach </li></ul><ul><li>13.0 M draft and thereafter top- up at anchorage by barges or Transfer Vessels. </li></ul><ul><li>No rail connectivity to ports like Belikeri, Karwar, Krishnapatnam. Thus movement by trucks is inevitable. </li></ul>
    31. 31. PORT INFRASTRUCTURE- CHALLENGES <ul><li>Poor infrastructure at ports leads to high throughput time, high turnaround time for ships, slower loading rates, delays due to break-downs and thus resulting in port congestions, higher incidence of demurrage costs and overall high costs. </li></ul><ul><li>Higher costs erode competitive advantage vis-à-vis exporters from other countries. </li></ul><ul><li>India unable to derive full benefit of geographical advantage to export markets due to poor infrastructure and high costs. </li></ul>
    32. 32. PORT INFRASTRUCTURE POSSIBLE SOLUTIONS TO CHALLENGES <ul><li>Port capacities to be augmented to gear up for higher exports of all commodities </li></ul><ul><li>Modernization of all machinery and mechanization </li></ul><ul><li>Develop higher drafts to take advantage of handling vessels of higher capacity with lower unit freight costs. </li></ul><ul><li>Compress time lines in port projects implementation </li></ul><ul><li>Matching port capacities with rail-road infrastructure to remove bottlenecks </li></ul><ul><li>Develop facilities for railway rakes to go inside the ports for unloading / loading and dispensing with interchange/exchange yards to reduce cycle time. </li></ul><ul><li>Seamless movement in/out of port for both road and rail to cut down waiting time and increase throughput. </li></ul>
    33. 33. WATER WAYS
    34. 34. IRON ORE TRANSPORT BY WATER WAYS <ul><li>The riverine system of Goa consisting of of Zuari, Mandovi rivers and Cumbarjua canal is the only waterway used for iron ore transport. </li></ul><ul><li>Mormugao and Panjim ports in Goa state receive iron ore by barges from mines / loading jetties on this riverine system. </li></ul><ul><li>Almost all iron ore of Goan origin is transported to ships by barges. This quantity is approx. 33.50 million mt in 2007-08. </li></ul><ul><li>Non-Goan iron ore is first transported to nearest railhead or by road to nearest loading jetty and then moved by barges to above 2 ports. The quantity moved in 2007-08 is approx. 6 million mt </li></ul><ul><li>Movement of iron ore by water ways in rest of the country is almost non-existent. </li></ul>
    35. 35. IRON ORE TRANSPORT BY WATER WAYS <ul><li>Water way transport is the cheapest and least polluting mode of transport. </li></ul><ul><li>Following is the data regarding fuel efficiency of various modes of transport </li></ul><ul><ul><li>Truck 1 litre 1 mt 25 kms </li></ul></ul><ul><ul><li>Train 1 litre 1 mt 86 kms </li></ul></ul><ul><ul><li>Barge 1 litre 1 mt 218 kms </li></ul></ul><ul><ul><ul><ul><ul><li>( Study by Deloitte) </li></ul></ul></ul></ul></ul><ul><li>Goan waterways is the only significant waterways system commercially significant. </li></ul><ul><li>Need to accord status of “ National Waterways” to enable get financial benefits and attracting further investments. </li></ul>
    36. 36. COASTAL MOVEMENT OF IRON ORE <ul><li>Coastal movement of iron ore is adopted by large domestic steel companies located close to the ports. </li></ul><ul><li>Ispat and Essar Steel do not have captive iron ore mines. These companies move their iron ore/pellets by coastal shipping. </li></ul><ul><li>Feasibility of coastal movement restricted to only large sized mills with large requirement of iron ore / other raw materials + with access to port/jetty facilities. </li></ul><ul><li>Large scale movement through this mode not apparent in short/medium term. </li></ul>
    37. 37. PIPELINE MOVEMENT OF IRON ORE <ul><li>KIOCL and Hy-Grade Pellets of Essar Group use this mode of transport. </li></ul><ul><ul><li>KIOCL (1982) 67 Kms length from Malleshwara (Kudremukh) to Panambur (near Mangalore). 7.5 million mt capacity. Not operational since 2006. </li></ul></ul><ul><ul><li>Essar (2006) 267 Kms length from Bailadilla (Chattisgarh) to Vizag.8 million mt capacity </li></ul></ul><ul><li>Pipelines are privately owned and are for captive use </li></ul><ul><li>KIOCL has stopped using this facility as mines in Kudremukh have been banned from mining on environmental considerations. </li></ul><ul><li>While this is the cheapest mode of transport as compared to all modes of transport, small size mines, dispersed steel mills are barriers to its large scale usage </li></ul><ul><li>However, movement to ports is a feasible option if implemented on multi-user basis. Short duration mining lease tenor, low reserve base of mines are barriers. </li></ul>
    38. 38. WRAP UP <ul><li>Iron ore is a key raw material for steel making </li></ul><ul><li>Globally it is one of the largest traded commodity </li></ul><ul><li>India is top iron ore mining and exporting country </li></ul><ul><li>Large reserves of iron ore in India enable iron ore exports even after meeting 100% domestic requirement </li></ul><ul><li>Among the various modes of transportation of iron ore- Railways and Road are the most important </li></ul><ul><li>Iron ore accounts for nearly 16% of total cargo carried by railways, next only to Coal </li></ul><ul><li>There are several challenges in rail transportation, the most important being high costs and inadequate capacity </li></ul><ul><li>Indian iron ore freight rates are 500% more than its competitor –Australia </li></ul><ul><li>High freight rates are the major reason for drastic fall in iron ore loading by railways in recent months </li></ul>
    39. 39. WRAP UP <ul><li>Rail transportation can become competitive by increasing line capacity, carrying capacity of trains, port connectivity etc. </li></ul><ul><li>Road transportation is the most common mode for transport of all goods accounting for 65% of all commodities carried. </li></ul><ul><li>Several infrastructure constraints exist for this mode that need to be addressed. </li></ul><ul><li>Port infrastructure in India is outdated and inadequate resulting in bottlenecks and high costs </li></ul><ul><li>Movement by Inland water ways and by Pipelines though cheaper, scope for large scale adoption is limited due to various reasons. </li></ul>
    40. 40. WRAP UP <ul><li>EXTREME FOCUS ON INFRASTRUCTURE IS ESSENTIAL FOR INDIA TO BECOME A SIGNIFICANT GLOBAL PLAYER. </li></ul><ul><li>THANKFULLY THIS SECTOR IS GETTING THE ATTENTION IT DESERVES NOW </li></ul>
    41. 41. <ul><li>THANK YOU </li></ul>
    42. 42. BHP BILLITON RAIL SYSTEM
    43. 43. BHP BILLITON RAIL SYSTEM <ul><li>A heavy haulage railway is used to carry the iron ore from the inland mining operations to the port, so that it can be shipped overseas. </li></ul><ul><li>BHP Billiton Iron Ore operates around 12 loaded and12 unloaded trains every day of the year. There are two separate single track rail lines: one running from Port Hedland to the Newman area; and the other running between Port Hedland and the Yarrie mine. </li></ul><ul><li>The 426-kilometre railway line from Newman to Nelson Point is one of Australia’s longest privately-owned railways. It services the mines - with spur lines to Mt Whaleback, Orebodies 18, 23, 25 and 29, Jimblebar, Yandi and Area C – with the longest and heaviest trains in the world. </li></ul>
    44. 44. BHP BILLITON RAIL SYSTEM <ul><li>A typical train will have six, 6,000 horsepower locomotives pulling more than 26,000 tonnes of ore. </li></ul><ul><li>Most trains are 208 cars, each carrying approximately 125 tonnes of ore.The trains are up to 3.75 kilometres long and the journey from Newman to Port Hedland takes approximately eight hours. </li></ul><ul><li>A 208-kilometre rail line links the Yarrie mine with Finucane Island. The trains are smaller on this line, with one locomotive pulling as many as 90 ore cars. </li></ul><ul><li>The Company’s 91 locomotives and almost 4,000 ore cars represent a major investment - each locomotive costs more than $6 million. </li></ul><ul><li>BHP Billiton’s iron ore rail system is one of the most technologically advanced and efficient in the world. The rail lines also form a key part of the iron ore production process, delivering to port in specific volumes and sequences for blending into final products. </li></ul><ul><li>All train movements are managed from a traffic control centre at Port Hedland. Specialised computer software and digital communications powered by solar technology control train movements, warn about unsafe conditions and weigh the ore cars as they pass by. </li></ul>

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