The cost of building Hancock Prospecting's Roy Hill iron ore mine in the Pilbara has been disclosed as $7.2 billion, as the project has been given the green light to build a railway from mine to port.
The project is majority owned by Gina Rinehart's Hancock Prospecting and its Korean partner Posco.
The West Australian government has signed an agreement allowing the construction of a 300km railway to connect the Roy Hill mine, about 110km north of Newman, with associated port infrastructure at Port Hedland.
"The State Agreement with Roy Hill Infrastructure is a major step forward for the development of the mine and allows construction of the railway line connecting the mine to port facilities to proceed," Premier Colin Barnett said in a statement.
Roy Hill Infrastructure will also develop stockyards at Boodarie; a train unloader; access corridors to the Inner Harbour; and two berths.
"With a capital expenditure of $7.2 billion, the project will see 1,500 people employed during the construction phase, which is expected to commence in mid-2011, and a permanent workforce of 750 people," Mr Barnett said.
"On completion, this project will enable greater access for smaller miners to rail infrastructure in the region, with provision for access or haulage services for these companies."
The Roy Hill Iron Ore mine has mineral resources of more than one billion tonnes and an estimated production rate of 55 million tonnes per annum expected to commence in 2014, with resources destined for markets in north Asia.
"The Roy Hill mine is expected to be a feature in Western Australia's resource industry for many years to come and it has a proven resource base that will sustain the project for at least the next two decades," the Premier said.
"I welcome this project and congratulate parent company Hancock Prospecting along with their Korean partners. This project adds to this State's reputation as being one of the world's great mineral precincts and will help feed the powerhouse economies in north Asia."
