Iron ore spot prices touched $US115 per tonne cost and freight two weeks ago.

“We don’t believe we’ll be paying any mining tax and certainly with today’s iron ore price I’d be extremely surprised if anyone was going to be paying mining tax in iron ore,” Power told reporters on the third and final day of Diggers & Dealers 2012.

“But fundamentally, we’ve forecast through over the next two or three years and we don’t see a significant impact on our business, but having said that, we’ll continue with our High Court challenge of the tax, because fundamentally, we think it’s a bad piece of legislation.

“It’s very narrowly based, it’s targeted the wrong part of the economy and we believe that it should be scrapped.”

Power said the High Court challenge was still in the early stages.

“There’s been a directions hearing, legal toing and froing with documents and those sorts of things, but there’s no substantive update other than that,” he said.

FMG shares last traded A6.5c up at $4.46.

This article first appeared in ILN's sister publication MiningNews.net.