How Will Fenix Resources Hit 6Mtpa Iron Ore by FY28?

Fenix’s Strategic Growth Trajectory

Fenix Resources Ltd (ASX, FEX) has laid out an ambitious yet measured three-year production plan that promises to reshape its iron ore output profile. Building on a solid FY25 performance of 2.4 million tonnes, the company aims to more than double production to 6 million tonnes per annum by FY28. Central to this growth is the consolidation of mining operations at the Weld Range Project, specifically the Beebyn Hub, marking a strategic shift from its legacy Iron Ridge and Shine mines.

FY26 guidance has been revised upward to 4.2 to 4.8 million tonnes, with a competitive C1 cash cost forecast between A$70 and A$80 per wet metric tonne, reflecting operational efficiencies and cost discipline. This increase underscores Fenix’s confidence in its asset base and operational execution.

Operational Consolidation and Resource Confidence

The transition to the Beebyn Hub within the Weld Range Project is a pivotal element of the plan. Mining at Iron Ridge is scheduled to conclude in 2026, with processing continuing into FY27 to ensure a smooth handover. Meanwhile, production at Shine will complete its first stage by early FY27, with further expansion under review but not yet included in the current plan.

Fenix’s approach is underpinned by a strong resource foundation, approximately 60% of the scheduled ore is sourced from proven and probable Ore Reserves, with the remaining 40% from measured and indicated Mineral Resources. This conservative resource base provides a high degree of confidence in the production targets and mitigates exploration risk.

Capital Efficiency and Logistics Integration

The company anticipates sustaining capital expenditure between $35 million and $45 million over the three years, excluding mobile equipment financed through existing facilities. This capital will support infrastructure, roadworks, and logistics assets essential for the ramp-up. Fenix’s vertically integrated model, encompassing mining, road haulage via Newhaul Road Logistics, and port operations through Newhaul Port Logistics at Geraldton, positions it well to optimise costs and operational throughput.

With storage capacity exceeding 400,000 tonnes and loading capabilities of approximately 10Mtpa at Geraldton Port, Fenix is equipped to handle the increased production volumes efficiently.

Looking Beyond FY28, Expansion and Partnership

Beyond the immediate three-year horizon, Fenix is advancing feasibility studies aimed at expanding the Weld Range Project’s production capacity to 10Mtpa. This aligns with its 30-year exclusive right to mine agreement with Sinosteel Midwest Corporation, a subsidiary of China’s Baowu Steel Group, one of the world’s largest steel producers.

The company is exploring opportunities to develop a second processing hub at Madoonga and investigating cost reduction initiatives such as a private haul road to Geraldton Port and transshipment options to lower shipping expenses. These initiatives could significantly enhance operational efficiency and profitability.

Executive Chairman John Welborn emphasised the organic nature of the growth plan, highlighting its funding through operational cash flow and existing financing facilities, and reaffirmed Fenix’s commitment to becoming a larger, more profitable, and sustainable iron ore producer.