A JOINT venture between grower-owned agribusiness FREE Eyre and transshipping company Sea Transport Corporation is expected to save growers money and create at least 50 jobs in the region.
The companies announced plans on Friday for a transshipping enterprise at Lucky Bay, near Cowell, where grain will be barged out to ships in Spencer Gulf.
The joint venture company Spencer Gulf Trust will bring together the global expertise of Sea Transport’s transshipping technology with FREE Eyre’s grain grower shareholders and clients, to build a bulk commodity transshipping terminal and enterprise at Lucky Bay, using state-of- the-art, shallow draft transshipping vessels to load larger cargo vessels moored in the gulf.
At the official opening of the Lucky Bay transshipping harbor extension on Friday, Free Eyre chairman John Crosby and Sea Transport chairman Stuart Ballantyne said that subject to funding negotiations, construction on the land-based grain receival, storage and handling facilities would start in the first quarter of 2017 and be completed in time to receive grain for the 2017 harvest.
Financial modelling suggests growers in the Lucky Bay catchment zone could save $10 to $19 a tonne on average, depending on individual growers’ freight costs.
Across the past 10 years, an average of one million tonnes of grain has been produced within this catchment zone.
The Spencer Gulf Trust anticipates Wallaroo will be the second stage with similar facilities designed to receive, store and export both grain and fertiliser, adding competition to the supply chain.
There is also potential for transshipping at other key locations such as Streaky Bay and Kangaroo Island and the company believes this alternative method of transshipping bulk commodities has the potential to transform grain and fertiliser handling in South Australia.
The Lucky Bay project is expected to create at least 50 new jobs as well as value-adding opportunities and investment in the region.
Funding for the $80 million to $90 million joint venture project is being negotiated but the company said it was well advanced.
It is expected a proportion of funding for the project will be secured against an equity contribution of about $3 a tonne that will be part of a user-pay charge for growers who use the facilities.
Although Lucky Bay will initially operate as a grain and fertiliser port, it could be used to transship minerals in the future.