Aggressive Pilbara expansion

THE iron ore landscape in the Pilbara region is consumed by expansion as miners plan to capitalise on rising prices and strong demand from China.

Major miners Rio Tinto and BHP Billiton outlined aggressive expansion plans in 2011, while Western Australian company Fortescue Metals Group also intends to continue its rapid growth as the state’s third-largest producer.

Rio Tinto is targeting a lift in capacity to 333 million tonnes per annum by the first half of 2015 after making funding commitments to achieve this last June. 

By the end of the first quarter of this year Rio Tinto expects its capacity to have reached 230mtpa, a figure that should continue to rise by the end of next year.

“The expansion of the Pilbara to 283mtpa by the end of 2013 remains on track,” Rio Tinto said in a statement.

“The feasibility study for the second phase of the Cape Lambert expansion continued to make good progress. 

“It is expected to increase the Pilbara’s capacity to 353mtpa and now incorporates the replacement of an old car dumper, with associated mine and infrastructure development.”

Rio Tinto’s expansion plans complement another record year in the region as full-year iron-ore production and shipments beat previous achievements.

The company delivered record output at its Pilbara mines, producing 62mt in the fourth quarter of 2011 and 231mt for the full year.

Not to be outdone, BHP outlined its ultimate objective to expand its iron ore capacity in the region to 450mtpa.

BHP’s board has already approved expansion to beyond 220mtpa and is in the study phase for growth to 350mtpa. 

In 2011, production at BHP Billiton rose by 22 per cent to a new record as expansions to its mine, rail and port facilities came into effect.

The company said output reached 41.1mt for the final three months of the year, which was an improvement on the 33.7mt a year earlier.

At this rate, BHP Billiton delivered a quarterly record annualised rate of 178mtpa and has set its guidance for 2012 to 159mtpa.

Fortescue has been just as vocal about its growth expectations and is on course to reach capacity of 155mtpa in the Pilbara by 2014.

The company said it surpassed original guidance for the year of between 13.5mt-14mt by achieving a record 14.77mt of total product shipped. 

Fortescue said it planned to sustain a run rate of 55mtpa for the March 2012 quarter, noting the period covers the traditional wet season in the region.

Outside of the top three iron ore miners in the Pilbara, Atlas Iron continues to consolidate its position in the region following the success of the Pardoo operation.

Atlas now produces from the Wodgina operation, south west of Pardoo, and has increased its presence in the region through the acquisitions of Giralia Resources, Aurox Resources and FerrAus.