BHP adds extra wave to WA’s resurgent mining sector with $2.9 billion iron ore mine

BHP has approved plans to build a US$2.9 billion iron ore project in Western Australia’s Pilbara region, in a move which will add to a growing construction boom in the state.

The South Flank iron ore project will replace a depleting mine in the region rather than adding new supply, said the world’s largest mining company in a statement.

South Flank could produce as much as 80 million tonnes of iron ore a year and will also help increase BHP’s overall iron ore grade to 62%.

The large-scale project will create about 2,500 jobs during construction and a further 600 ongoing operational roles when it reaches production in 2021.

WA’s Treasurer Ben Wyatt welcomed the BHP project, labelling it a vote of confidence in the state’s long-term economy.

“It highlights the fallacy some people have around the idea that the mining sector simply goes bust — it doesn’t, it changes, it morphs into a new phase and this is a new phase for BHP and an exciting time for the WA economy,” he said.

“WA is at its core, and is going to be for a long period of time, a mining state and these sorts of decisions highlight that’s not a negative, it’s very much a positive.”

Last month Fortescue Metals Group approved the development of its $1.27 billion Eliwana mine, while Rio Tinto is also expected to approve its $2.2 billion Koodaideri mine later this year.

@RGNonline