BHP Billiton's RGP6 Jimblebar Mine Expansion Nears Completion

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Researched by Industrial Info Resources (Perth, Australia)--BHP Billiton Limited (NYSE:BHP) is nearing completion of its expansion project for the Jimblebar iron ore mine and processing plant at Newman (Western Australia). The expansion is ahead of its scheduled date. The project, which is referred to as Rapid Growth Project 6 (RGP6), involves the development of Ore Body 18 and the expansion of the processing facility. The completion of the project will see the processing capacity increase by an estimated 30-million tons per year (T/yr) of iron ore.

This processing facility will act as a central processing hub for BHP's future eastern Pilbara mining pits. The expansion project is targeted to increase BHP's total projected iron ore output to 240-million T/yr upon completion.

The construction on the RGP6 kicked off in early 2012, and the company is expecting to start commissioning by the fourth quarter of 2013. The development saw the involvement of multiple design, engineering and construction companies because of its sheer size. The process infrastructure side of the project was handled by a joint venture between engineering firms Sinclair Knight Merz (SKM) and Fluor Corporation (NYSE:FLR), called FAST (Fluor SKM Iron Ore Joine Venture), which is overseeing the engineering, procurement and construction (EPC).

GHD Engineers Australia was selected as the EPC for the non-process infrastructure scope. A contract was awarded to Thiess Australia for the bulk earthworks for the process infrastructure. Most of the civil infrastructure and building infrastructure has been completed. VDM Group (ASX:VMG) was contracted for the construction of an ammonium nitrate storage facility at the site for an estimated value of $26 million, which was completed in early 2013. The structural, mechanical and piping (SMP) contract for the processing plant inflow circuit was awarded to AGC Australia, and the work will be completed and handed over by August 2013.

BHP Billiton is also developing two other related projects involving the duplication of a rail line and the ongoing Port Hedland inner harbour expansion. However, the port development was put on hold due to a recent decrease in iron ore prices.

The completion of this expansion reaffirms BHP's confidence in the long-term demand outlook, underpinned by China and India's urbanization and industrialization. It also will ensure the speedy execution of other developing projects in Western Australia's Pilbara region.

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