Early works have begun on an expansion project in South Australia’s Middleback Ranges that will secure the supply of magnetite required by the Whyalla Steelworks.
Stage one of the Magnetite Expansion Project (MEP1) has already started, with geotechnical drilling ahead of planned construction activities underway at Iron Duke.
The project is expected to facilitate magnetite production of up to 2.5 million tonnes per year, providing long-term certainty for the Whyalla Steelworks. The project will extend mine life by an additional 20 years, ensuring job continuity for more than 300 employees.
The Australian federal and South Australian state governments provided a AU$20 million joint loan for the project, which is part of the AU$275 million funding package announced in July 2025.
Federal Minister for Industry and Innovation and Minister for Science Tim Ayres said: “This $20 million jointly-funded loan is driving early works on a transformative mining project that will secure the future of steelmaking in Whyalla and provide long-term certainty for the region.
“With a world-class magnetite resource and an estimated 21-year mine life, this project underpins more than 300 jobs and supports the move to low-emissions iron and steelmaking in South Australia.”
The South Australian government placed Whyalla Steelworks under administration in February 2025 after former owner GFG Alliance failed to pay tens of millions of dollars in royalty payments to the government.
The federal and state governments then jointly committed to a historic AU$2.4 billion support package, including financial assistance for local suppliers.
The funding package secured the future of Whyalla, which is one of only two Australian primary steelworks and the only manufacturer of long products, including hot rolled structural steel sections and rail.
Since the government’s intervention, the Steelworks operation has achieved its best open-pour billet casting performance since it was commissioned in 1999.
In November 2025, the Finished Goods team dispatched close to 8500 tonnes of product in just three days, the highest result in a decade.
Foreign investors have also expressed interest in the steelworks. Five domestic and international industrial groups were shortlisted for the final stage of binding bids after interest from more than 70 parties worldwide.
The five shortlisted proponents are now undertaking detailed technical, financial and operational due diligence ahead of the submission of binding bids expected within months.
SA Energy and Mining Minister Tom Koutsantonis said: “MEP1 stands to mark the next chapter in the region’s industrial evolution.
“Progressing this project demonstrates continuity of supply, long-term mine life and a clear pathway to industrial transformation – and further strengthens the value proposition as we enter a decisive period in the sale process.”