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PERTH - Rio Tinto (ASX:RIO)(LSE:RIO) and Hancock Prospecting announced Tuesday they will jointly invest $1.6 billion to develop the Hope Downs 2 iron ore project in Western Australia’s Pilbara region.
The project, which has received all necessary government approvals, will develop two new above-water-table iron ore pits with a combined annual production capacity of 31 million tonnes. Rio Tinto’s share of the investment amounts to $800 million.
First ore from the deposits is scheduled for 2027. The project will create more than 950 jobs during construction and help sustain approximately 1,000 full-time equivalent positions once operational.
"These projects are part of our strategy to continue investing in Australian iron ore and to sustain Pilbara production for decades to come," said Rio Tinto Iron Ore Chief Executive Simon Trott in a press release statement.
The development includes new infrastructure precincts, railway crossings, haul roads, and realignment of a 6-kilometer section of the Great Northern Highway. Ore from the new sites will be transported to Hope Downs 1 for processing.
Hope Downs 2 forms part of Rio Tinto’s replacement projects in the Pilbara region, which will have a combined total capacity of approximately 130 million tonnes per annum. The company expects to invest more than $13 billion on new mines, plant and equipment over the next three years.
Rio Tinto and Hancock Prospecting are equal partners in the Hope Downs Joint Venture, which was established in 2006. The joint venture’s first operation, Hope Downs 1, began production in 2007, followed by Hope Downs 4 in 2013.
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