Cyclone shuts WA iron ore ports; oil, gas plants

by Reuters

A cyclone bearing down on Western Australia has brought iron ore shipments from the world's top exporter to a near standstill as ports shut ahead of the storm.

Two of the world's largest iron ore terminals at Port of Dampier and Port Hedland have suspended operations as Cyclone Carlos builds and sweeps toward the country's northwest.

Nearly all of Australia's around 400 million tonnes of iron ore exports are shipped from the two ports.

Port officials and meteorologists say it could be days before the storm passes and ships can return to the loading berths used by global mining giants such as Rio Tinto Ltd and BHP Billiton Ltd.

The centre of the cyclone is forecast to pass over Dampier around 1800 AEDT and continue to make its way south causing localised flooding.

Even a short interruption could add to a demand-driven rally toward $US200 a tonne on global iron markets. Iron ore prices have risen over 10 percent to date this year.

Gales with wind gusts to 110 kilometres per hour were slamming into coastal areas west of Port Hedland and were heading westward towards Dampier, according to the Australian Bureau of Meteorology.

Cyclones are a normal fixture of an Australian summer but the national weather bureau has indicated that above-average cyclone activity is to be expected this season due to a La Nina weather event.

"We've tied the port down and closed and all the vessels have gone to sea to get past the cyclone," chief executive of the Dampier Port Authority Steve Lewis said.

The Port of Dampier is one of two ports in Western Australia used by Rio Tinto to export around 200 million tonnes of iron ore each year.

"We're fully tied down at the coast, so there's no ship or rail movement until it passes," a Rio Tinto spokesman said.

Port Hedland suspended operations on Monday evening with the approach of Carlos, a category two storm, which is forecast to move westward in the coming days before turning southward.

A spokesperson for the Port Authority there told Reuters the harbour master would wait until the danger had passed and assess the situation before reopening the port to shipping.

BHP Billiton relies on Port Hedland to ship more than 100 million tonnes of iron ore a year. Fortescue Metals Group and Atlas Iron also use the port exclusively.

Australia's northwest coast is also home to some of the country's biggest oil and gas operations, with several of them suspending operations and battening down as the cyclone crosses through the area.

Woodside Petroleum Ltd halted production at its Cossack Pioneer floating, production, storage and offloading unit on the North West Shelf due to Tropical Cyclone Carlos the company said on Monday.

Apache Corp also halted production at its Stag and Van Gogh oil fields off the coast of Western Australia on Monday.

Chevron shut oil and gas production at Barrow and Thevenard Island facilities on Monday and non-essential workers were evacuated from the facilities.

"Production is being shut in and wells secured," Chevron spokesman Guy Houston said.