Rio Tinto and its project partners have approved a US$1.55B investment to sustain Pilbara iron ore production capacity.
Rio Tinto, Mitsui and Nippon Steel & Sumitomo Metal Corporation have approved the investment, with Rio’s 53% share equating to US$820M, to sustain production capacity at two projects that form part of the Robe River Joint Venture in the Pilbara region of Western Australia.
The joint venture partners will invest US$967 to develop the Mesa B, C and H deposits at Robe Valley, and US$579M to develop Deposits C and D at the existing West Angelas operation.
Rio Tinto said that these investments enable it to sustain production of the Pilbara Blend, said to be the world’s most recognised brand of iron ore, and its Robe Valley lump and fines products, which are highly valued by long-term customers.
Subject to government and environmental approvals, construction of both projects is expected to start next year, with an estimated 1,200 jobs created during this phase. First ore is currently anticipated from 2021. These investments will also provide significant opportunities for local businesses as part of Rio Tinto’s commitment to local procurement and supporting WA businesses, according to the mining giant.
Once operational, both projects will feature the latest technology, with 34 existing haul trucks to be retrofitted with Autonomous Haulage System (AHS) technology, delivering safety and productivity gains to the business.
Chris Salisbury, CEO of Rio Tinto Iron Ore, said: “The development at West Angelas will help sustain production of the Pilbara Blend, the industry’s benchmark premium iron ore product, while the additional Robe Valley deposits will enable us to continue to provide a highly valued product to our long-term customers across Asia.
“The approval of these two projects highlights the strong pipeline of development options within our portfolio as we remain focused on our value-over-volume strategy.”
Rio Tinto added that its funding commitment for both projects of US$820M forms part of the company’s existing replacement capital guidance of around US$2.7B from 2018 to 2020.
Rio Tinto owns a 53% holding in the Robe River Joint Venture, Mitsui 33%, and Nippon Steel & Sumitomo Metal Corporation 14%.