The signing of the State Agreement relating to the Mid West Iron and Steel Project, 

by An Feng Kingstream Steel Co., Ltd with the Western Australian Government 

keeps the $1.4 billion project on tract for the commencement of plant construction

in the second half of this year.

  The Iron and Steel(Mid West) State Agreement was introduced into the Western

Australia Parliament for ratification on March 19 by the Minister for Resources 

Development, The Hon Colin Barnet MLA.

  The development of the fully integrated steel plant near Geraldton is being 

undertaken by An Feng Kingstream Steel Co., Ltd, and will produce 2.4 million tonnes 

of steel slab a year for export to An Feng's hot and cold rolled steel mills in Taiwan.

The proposed plant is Western Australia's first steel production plant and a major 

breakthrough for the state in terms of value-added processing.

  Managing Director Nik Zuks said the State Agreement was important to the success

of the venture and would provide a comprehension framework around to which the

project would be built.  "The 63 year time frame provided ensures long term security

of tenure for mining tenements in the Mid West region, access to all necessary

services and infrastructure and a secure means of supply of all consumables 

such as gas, power and water," Mr Zuks said.  "The State Government's support for 

the project is a significant step for An Feng Kingstream Steel Co., Ltd in the development 

of the downstream processing facility that will be of great economic importance to the 

Mid West Region, Western Australia and Australia."

  A critical component for the State Agreement is the government's decision to evaluate 

the establishment of an industrial estate and a deepwater port at the proposed plant

site of Oakajee, 25 km north of Geraldton.

The State has agreed to :

ĄDUpgrade public roads between Oakajee and Geraldton;

ĄDMeet capital costs of constructing electricity transmission facilities to the Oakajee 

    plant site;

ĄDConstruct a railway linking Oakajee to the Geraldton-Mullewa rail line for transport 

    of ore the plant;

ĄDConstruct, or have constructed, the deepwater port at Oakajee;

ĄDMeet additional capatial costs of water supply to the Oakajee site, if the Water 

    Corporation supplies water; 

ĄDIssue An Feng Kingstream Steel a pipeline licence for the transmission of gas to 

    the project if a suitable agreement for supply cannot be reached with the gas 

    corporation(Alinta Gas).

   Mr Barnett said the State Agreement was a positive step for the Mid West Iron and 

Steel project.  "Thi project is one of the largest being considered in Australia at the 

moment and has the potential to be one of the most important developments ever to 

happen in WA,"  Mr Barnett said.  "Annual export earnings of up to $700 million a 

year are forecast from the production of 2.4 million tonnes of steel slab annually."

"This will be the first major development of its kind in the Mid West region and I 

expect it to be the first of several major projects to come wjich will be boosted by 

the development of Oakajee as WA's next major industrial estate."  Mr Barnett said 

he anticipated the State Agreement would be ratified by both houses of Parliament 

by the end of May.