Rio Tinto and Hancock Prospecting have announced plans to invest $1.6bn in the Hope Downs 2 iron ore project in Western Australia’s Pilbara region, with Rio Tinto’s share being $800m.
Having received all necessary government approvals, the project is set to sustain production from the Hope Downs joint venture (JV), in which Rio Tinto and Hancock Prospecting are equal partners.
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The Hope Downs 2 project will mine the Hope Downs 2 and Bedded Hilltop deposits, with two new above-water-table iron ore pits.
These pits are expected to have a combined annual production capacity of 31 million tonnes (mt), which will contribute to the long-term output of the joint venture.
Rio Tinto iron ore chief executive Simon Trott said: “Approval of Hope Downs 2 is a key milestone for Rio Tinto, as we invest in the next generation of iron ore mines in the Pilbara.
“These projects are part of our strategy to continue investing in Australian iron ore and to sustain Pilbara production for decades to come, supporting jobs, local businesses and the state and national economies.
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By GlobalDataThe development will include new non-process infrastructure precincts, railway crossings, haul roads, and the realignment of a 6km section of the Great Northern Highway.
The ore from the new sites will be processed at Hope Downs 1, with the first ore and associated infrastructure expected to be operational by 2027.
The construction phase is expected to create more than 950 jobs, and once operational, the Hope Downs 2 project is anticipated to sustain approximately 1,000 full-time equivalent positions.
Hope Downs 2 is part of a series of replacement projects that underline Rio Tinto’s ongoing commitment to the Pilbara region.
With a combined capacity of 130mtpa, these projects are integral to the company’s strategy in the region.
Over the next three years, Rio Tinto plans to invest more than $13bn in new mines, plant, and equipment.
The company aims to achieve and maintain a mid-term system capacity of between 345mtpa and 360mtpa from its Pilbara iron ore operations.
Additionally, a pre-feasibility study is in progress for the Rhodes Ridge project, considered Pilbara’s most significant undeveloped iron ore deposit.
In a separate development, Rio Tinto has agreed to pay £103.39m ($138.75m) to settle a US lawsuit alleging investor fraud related to its Oyu Tolgoi mine expansion in Mongolia.
This preliminary settlement, which awaits judicial approval, was filed with the US District Court in Manhattan and represents Turquoise Hill Resources shareholders affected between July 2018 and July 2019 when Rio Tinto held a majority stake.
