CITIC is in talks with Australia mining company Fortescue Metals Group to invest as much as US$1.26 billion in an iron mining project in Western Australia. Steelmakers signed letters of intent to buy a total of 60 million metric tons of iron a year for 25 years through the project. The project would consist of a US$385 million ore mining and processing facility with an annual processing capacity of 45 million metric tons, a US$581 million 520km railway and a US$329 million port. Fortescue obtained a letter of intent from an undisclosed financial institution to fund the project through sale of US$880 million in bonds in US markets. China Railway Engineering signed an agreement to build the railway, on which construction could begin in March 2005. Chinese companies are in talks to construct the port section of the project.