Fortescue Metals Ltd says there won't be a repeat of last year's scare when the iron ore price tanked, dragging down its shares and forcing it to refinance its debt.
Chief executive officer Nev Power said while releasing the company's March quarter production report today that Fortescue was in a far better position than last September when iron ore prices plunged to $US86.70 a tonne.
Analysts said at the time the company could not repay its massive $12.6 billion in debt at those prices, but it now does not owe any debt until late 2015.
"Circumstances are quite different to what they were last year, fundamentally we are in a different position," he told reporters.
He said Fortescue had a net cash balance of $US1.5 billion and was close to the end of the construction-capital outflow stages of its expansion.
He rejected the views of some analysts that the iron ore price would again fall in the second half of the year as supply from new mines comes online.
"Its easy to announce that all of these new projects and supply will come into the market but it is much more difficult to get them funded and put infrastructure solutions in place," Mr Power said.
"I'm sure that will be stretched over a longer time period than forecast and keep the market in supply-demand balance."
Mr Power says he did not think iron ore stocks in China were high enough to allow a severe drop in price.
Fortescue sees continued strong Chinese demand for urbanisation for at least another two decades and already had offtake agreements for 120 million tonnes a year supplying Chinese steel mills, Mr Power said.
It has set a target date of June to sell a multi-billion-dollar 40 per cent stake in its Pilbara rail and port infrastructure to pay down debt, which it said was well progressed.
Fortescue's March quarterly shipments rose 60 per cent on the same perio