The Australian investors backing the project in Western Australia’s Mid West region were unnamed.

The “private Australian equity investors” will take a 64% stake in Padbury’s subsidiary Midwest Infrastructure (MWI), owner of the intellectual property of Yilgarn Infrastructure, which bid to build the project in 2008.

Padbury will retain 36% of the company and can claw back to 49% once the private investment has been returned.

The first tranche of $470 million will pay for the update of the prefeasibility study, the completion of design and construct specifications and the beginning of early civil works over the next nine months.

Padbury has been working closely with Korean engineering procurement and construction companies, which have shown interest in being involved in the $A6 billion project from PFS stage through to completion.

MWI expects to sign an agreement with an EPC shortly to progress the project.

The second and third tranches of $3.45 billion and $2.55 billion, respectively, will be used for construction.

Padbury managing director Gary Stokes said the company had been working hard for the past 18 months to get to this point.



“It has been an enormous challenge on many fronts, but today’s announcement will see this game-changing project finally come to fruition,” he said.

Padbury has been working on an alternative project proposal since July 2011 when it acquired the IP.

The company’s efforts only intensified last year when Oakajee Port & Rail owner Mitsubishi Development put its plans to build the project on ice after investment of about $700 million.

Iron ore hopefuls in the Mid West have long been hoping for progress on the project to unlock the region’s resources, because Geraldton port has no capacity.

Padbury is envisioning the Oakajee deepwater port to have capacity of 35-45 million tonnes per annum initially.

The company said there were around 21 businesses with iron ore interests in the region, with combined JORC resources of 21 billion tonnes.

The proposed rail network would be multi-user.

Padbury is already in talks with the WA government and expects today’s funding announcement to increase the engagement.

Shares in Padbury rose by as much as 160% to 5.2c, but were last trading 75% higher at 3.5c.