BHP Billiton Expanding Iron Ore Mining In Western Australia

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Researched by Industrialinfo.com (Industrial Information Resources, Inc.; Houston, TX). A new iron ore mine in the Pilbara region of Northwestern Australia and associated expansion of port and rail facilities at Port Headland with a total capital cost of $564 million has been announced by BHP Billiton. The company will have a $181 million share in the mine and a $299 million share in the Port and Capacity Expansion (PACE).

The Mining Area C development has the potential to increase iron ore production by up to 15 million tons per annum (mtpa) by 2011. The PACE will increase BHP Billiton's export capacity from 67 mtpa to 81 mtpa by 2004 and provide the foundation for expansion to over 90 mtpa by 2011, an increase of more than 40%.

The new mine is the first step in unlocking the significant Marra Mamba resource in Mining Area C, which will target the growing requirements for high 'Value in Use' ore from Asia's direct blast furnace steelmakers. It will also maintain BHP's share of the global seaborne market for iron ore.

The area is located 37 kilometers from BHP's existing Yandi Mine and contains the largest undeveloped Marra Mamba resource in the Pilbara. The resource is currently estimated at 890 million tons with significant further exploration potential. 'C Deposit' is located on the northern flank of Mining Area C and contains a proven and probable reserve of 201 million tons.

Expansion of the new port facilities will start later this year and will include a new stockyard, a major upgrade and enhancement of dust suppression systems, upgrading the under harbour tunnel conveyor from 4,500 tph to 10,000 tph, establishing an additional lump screening faciltiy, and the extension of existing shipping berths.

Full scale mining will begin in 2003 with construction starting immediately this year. The mine development will include a 15 mtpa mine and processing facility to produce Marra Mamba lump and fines, construction of a 38km railway linking Mining Area C to Yandi, installation of infrastructure including power, water, airstrip, and access roads, and accommodation for a 500 strong construction workforce and a permanent operations workforce of 150.

Under a joint venture agreement, ownership shares of the 'C Deposit' will be BHP Billiton 65%, POSCO 20%, CI Minerals Australia 8% and Mitsui Iron Ore Corporation 7%.