Rio Tinto Continues Pilbara Iron-Ore Terminal Expansion

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Researched by Industrial Info Resources (Sugar Land, Texas)--Anglo-Australian mining giant Rio Tinto plc (NYSE:RTP) (London, England) has continued its massive investment in Western Australia's Pilbara region by committing another $790 million toward the Cape Lambert Iron Ore Terminal Expansion.

The expansion, which is due to kick off with early construction next month, will be executed in two phases and will increase the total capacity of the Cape Lambert Terminal from its current 80 million tons per year to 180 million tons per year by 2016. The initial phase, which will add 50 million tons of capacity, is due to be completed by 2014, with the second phase adding 50 million tons by 2016.

Rio Tinto plans to achieve the increased capacity by constructing a 1.8-kilometer jetty; a four-berth wharf that will run parallel to the jetty; and an overland conveyor.

Last month, Rio Tinto announced $200 million would be invested in dredging work, including the dredging of approximately 1.8 million square meters of material in preparation for the wharf construction. Of the latest $790 million, $415 million will be spent on long-lead items such as pile and marine structure and on-shore works, and the other $375 million will go toward marine works associated with the Wharf.

Sam Walsh, Rio Tinto's chief executive for iron ore and Australia, said the new investment highlighted Rio Tinto's intention to forge ahead with the expansion. "Rio Tinto has a proven track record of managing large-scale iron ore development projects, and this decision should be seen in that light," he said.

The Cape Lambert expansion is only a small step toward Rio Tinto's planned $11 billion Pilbara expansion, which includes the development of multiple iron-ore projects, including Hope Downs, Brockman 4 and the Mesa A expansion, all of which are being tracked by Industrial Info.

It seems that even with the ever-looming threat of the Australian Mining Tax, Rio is not afraid to push forward with its current projects. After last week's half-year profit announcement of $5.85 billion, it's easy to see why. For more information, see August 6, 2010, article - Rio Tinto Boasts Record Earnings in First-Half 2010.

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