Fortescue Metals Group has been given the go ahead for a $1.275bn development of the Eliwana mine and rail project, located in the Pilbara region, Western Australia (WA).

The planned project will include the construction of 143km of rail, and a dry ore processing facility (OPF) capable of producing 30 million tonnes per annum, as well as developments to infrastructure.

Fortescue noted that the mine will allow the introduction of a 60% iron grade product in the second half of the 2019 financial year.

“Development of the Eliwana project will maintain Fortescue’s low-cost status, providing us with greater flexibility to capitalise on market dynamics.”

The company expects to begin production in December 2020.

Fortescue Metals Group CEO Elizabeth Gaines said: “Development of the Eliwana project will maintain Fortescue’s low-cost status, providing us with greater flexibility to capitalise on market dynamics while maintaining a minimum 170 million tonnes per annum production rate over 20 years.”

“This project allows us to commence the supply of Fortescue Premium product to the market from existing operations in the second half of FY19 with volumes increased as Eliwana ramps up to full production.”

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By GlobalData

The project is anticipated to create 1,900 jobs during construction and 500 full-time site positions once operations begin.

Operations at the project site will also see the deployment of autonomous trucks.

The company intends to spend the development costs for the project over the next three financial years, with $165m in 2019, $760m in 2020 and $350 in 2021.

Having completed a definitive feasibility study report (DFS), the company plans to start a detailed design.

Fortescue is currently seeking approvals for two public environmental reviews and a mining proposal.