Rio Tinto approves $2.6 billion investment in Koodaideri iron ore mine
Staff Writer |
Rio Tinto is to develop its most technologically advanced mine following the full approval of a $2.6 billion (A$3.5 billion) investment in the Koodaideri iron ore mine in Western Australia.
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Koodaideri will deliver a new production hub for Rio Tinto’s world-class iron ore business in the Pilbara, incorporating a processing plant and infrastructure including a 166-kilometre rail line connecting the mine to the existing network.
Construction will start next year with first production expected in late 2021. Once complete, the mine will have an annual capacity of 43 million tonnes, underpinning production of the Pilbara Blend, Rio Tinto’s flagship iron ore product.
Koodaideri Phase 1 will help sustain Rio Tinto’s existing production capacity by replacing depletion elsewhere in the system.
The project will increase the higher-value lump component of the Pilbara Blend, subject to market conditions, from the current average of about 35 per cent to around 38 per cent.
It is expected to deliver an internal rate of return of 20 per cent and capital intensity of around $60 per tonne of annual capacity, highly competitive for a new mine considering the additional infrastructure of rail spur, airport, camp and road access required.
The operation has been designed to utilise an increased level of automation and digitisation, helping to deliver a safer and more productive mine which is expected to be Rio Tinto’s lowest cost contributor to its industry benchmark Pilbara Blend product. Through the use of digital assets, advanced data analytics and automation, Rio Tinto expects to significantly enhance the operation and maintenance of this new mine. ■
An upper-level trough over the Four Corners region currently will move east across the Southern Plains through this evening which will help to focus a strengthening area of low pressure north of the Red River Valley as a couple of trailing cold fronts drop southeastward across Texas.