Global miner Rio Tinto Ltd
(ASX:RIO) is to spend an extra US$2.1 billion to expand capacity at its iron ore operations in the Pilbara of Western Australia.
A total of US$3.1 billion will be spent on the expansion, Rio’s joint venture partners taking up the slack.
The news from Rio comes after the company announced that it and joint venture partner BHP Billiton would walk away from their planned $116 billion iron ore alliance in the Pilbara.
The miner says this investment will increase annual infrastructure capacity to 283 million tonnes during 2013.
Rio says further investments will need to be made to achieve production of 283 million tonnes a year, such as mine and housing expansions, with approval of these anticipated within the next 12 months.
The iron ore giant has also approved a final feasibility study into increasing Pilbara production capacity to 333 million tonnes a year.
The US$3.1 billion investment announced today will go towards port and rail infrastructure works around Cape Lambert, including a two berth-wharf, new stockyard, car dumper, two stackers and reclaimers, rail marshalling yards and six new heavy-haul train units.
Rio earned profit of $7.36 billion for the half year to June 30, 2010.
