Mining giant Rio Tinto and its partners Mitsui and Nippon Steel & Sumitomo Metal have sanctioned a $1.55bn investment to maintain production capacity at two Australian iron ore projects in the Pilbara region.
The two iron ore projects marked for the investment are the Robe Valley and West Angelas operations in Western Australia, which are both part of the Robe River Joint Venture.
Rio Tinto will be covering 53% of the investment at $820m in line with its stake in the iron ore joint venture. Mitsui owns a 33% stake while Nippon Steel & Sumitomo Metal holds a 14% stake in the Robe River Joint Venture.
As per the plan, the mining giant alongside its joint venture partners will invest $967m on development of the Mesa B, C and H iron ore deposits at Robe Valley. Rio Tinto’s share in this will be $513m.
For the existing West Angelas operation, the partners will invest $579m for the development of Deposits C and D with Rio Tinto to cover $307m of that amount.
The latest investments in the two Australian iron ore projects will enable the mining giant to maintain production of the Pilbara Blend variety of iron ore and also its Robe Valley lump and fines products.
Rio Tinto iron ore CEO Chris Salisbury 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.”
Depending on government and environmental approvals, the Western Australian iron ore projects are anticipated to break ground in 2019 with 1,200 jobs estimated to be created during this phase.
First ore from the Robe Valley and West Angelas iron ore projects are expected to be drawn from 2021.
Rio Tinto revealed that after entering into operations, the two Australian iron ore projects will involve the latest technology, including the usage of 34 existing haul trucks which will be retrofitted with Autonomous Haulage System (AHS) technology to help in driving safety and productivity gains for the joint venture.