Australian cyclone intensifies as it approaches iron ore belt

SYDNEY (REUTERS) - A cyclone approaching Australia's north-west coast that forced miners to shut down key iron ore export terminals and offshore oilfields has intensified into a category four storm, the second-highest level, and will strengthen over the weekend.

The Bureau of Meteorology said wind gusts of 100kph are expected to develop along the coastline on Friday, before strengthening to as much as 250kph near the cyclone's centre over the weekend.

Cyclone Narelle is not expected to make landfall in Western Australia, but authorities warned residents in coastal towns it will still be extremely dangerous.

The first cyclone of the Australian season was some 515km offshore of the coastal town of Karratha, an oil and mining services hub used by Woodside Petroleum, Apache Corp, CITIC Pacific, Rio Tinto, Shell and others.

Woodside, Apache and BHP Billiton are disconnecting oil production vessels from offshore fields that contribute about a third of Australia's oil production of 390,000 barrels per day, sources with direct knowledge of the matter said.

Rio Tinto , the world's second-largest iron ore producer, has suspended ship loading at the ports of Dampier and Cape Lambert.

Further along the coast, Port Hedland is used by BHP Billiton, Fortescue and Atlas Iron to ship hundreds of millions of tonnes of ore annually.

Companies including Chevron Energy, which uses Karratha as a base for the US$27 billion (S$33.2 billion) North West Shelf LNG project, are preparing to evacuate staff if the cyclone suddenly changes direction and speed, which is a common occurrence with such storms in the Pilbara iron belt.

Qantas Airways has scheduled extra flights to evacuate workers from drilling platforms and mining sites if necessary.

There are on average around seven cyclones a year in Western Australia between December and April.

Last March, Cyclone Lua halted output of about a quarter of Australia's daily oil production of 390,000 barrels as companies were forced to suspend offshore drilling and evacuate staff.

Wind speeds are calculated using a system categorising a cyclone's intensity on a scale of one to five.