The Australian Pipeline Trust (APA) advises that the announced suspension of operations of the Xstrata Vanadium Mine at Windamurra in W.A, whilst unfortunate, is unlikely to affect the carrying value of the Windamurra Pipeline.
Revenue reduction to APA for a full year of mine closure is estimated at $1.7 million.
APA has another customer (Hill 60 Gold Mine at Mt. Magnet) which continues to use the pipeline; APA is confident that the rich mineralisation of the area will produce additional load from future mining developments.
APA recognise Xstrata’s claim that reduced Vanadium prices and their exposure to the
Australian dollar is affecting mine profitability in the short term: we understand the mine has the potential for 100 years of operation based upon known reserves.
The mine is presently running at about one third capacity and is expected to be placed on care and maintenance. It is understood that Xstrata is in discussions with the W.A. government in an attempt to avert permanent mine closure.
APA distribution for year ending June 2003 will not be affected by the reduction of revenue resulting from the suspension of operations at the mine.

J. K. McDonald
Managing Director