Iron ore miner Fortescue Metals Group will start reducing its $12 billion in debt from November.

The first step in its debt reduction program will be the early repayment of what it says is its most expensive debt – $140 million in preference shares.

Fortescue, now the world’s fourth largest iron ore miner, issued the high interest debt as part of its original financing in 2008.

Fortescue refinanced its debt a year ago when iron ore prices plunged to near unprofitable levels, creating a potential liquidity crisis.

Prices have since recovered and are currently high at above $US130 a tonne.

Fortescue shares gained four cents to $4.62.