News

June 09, 2008

Forrest’s Second Fortune, Or, The Alchemist's Way To Turn Paper Into Cash

By Our Man in Oz

Making money from resources in Australia has, so far, been about mining. Andrew Forrest, the richest man in Oz, and perhaps the owner of the world’s fastest US$10 billion paper fortune, is about to become an alchemist and show (a) how to crystallise paper into cash, and (b) reveal the next phase of the boom: infrastructure funds. While the precise details of Forrest’s next trick remain sketchy, Minesite’s Man in Oz reckons he has cracked the code. It’s a process which involved firing up the De Lorean for a trip back to the future. It was in February 2004, that Forrest used a conference in the port city of Fremantle to spell out how he planned to turn Fortescue Metals Group (FMG) into a world-class iron ore miner to rival BHP Billiton and Rio Tinto. But what everyone has overlooked since is that FMG was born with a twin brother, a corporate structure which has been hidden away for more than four years, the Pilbara Infrastructure Fund (PIF).

The time has almost come for the unveiling of PIF, which was, according to the original plan: “to be listed post commissioning”. Well, commissioning is underway at FMG. The mine and railway definitely work. The port has loaded its first ship, and the ship has, in turn, been unloaded in Shanghai. Barring something unusual the FMG project is well into its commissioning phase, and PIF is getting reading for an airing. The only question is when, and to that question Forrest told Minesite’s Man in...