Rio lifts iron ore spend
8th Feb 2012
MELBOURNE, Feb 8 – Rio Tinto has committed US$3.4B to two major development projects expanding production and ore handling capacity at its iron ore operations in Western Australia.
The first of the projects, the $2.2B Nammuldi mine expansion, will help the company achieve its current production target of 283Mtpa from Pilbara operations in the second half of 2013.
The second, $1.2B for port and rail early works at Cape Lambert will prepare the way for the next proposed capacity expansion to 353Mtpa.
The expansion of Rio’s 100%-owned Nammuldi project will extend existing mining below the water table, increasing the mine’s life by 14 years at a production rate of about 16Mtpa.
Although the Nammuldi expansion will not deliver first ore until the September quarter of 2014, Rio says ore from other mines during the transitional period will allow it to meet its 283Mtpa regional target.
The $1.2B (Rio share $700M) Cape Lambert project anticipates the final investment decision expected later this year for the 353Mtpa expansion, currently in final feasibility study.
Rio Tinto Iron Ore chief executive Sam Walsh says the expansions from the current Pilbara operations capacity of 225Mtpa are bringing new iron ore production on stream at a time when demand from Asian markets is forecast to grow strongly amid constrained industry supply growth.
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