Name and Location
Western Australia iron-ore (WAIO) operations growth project, Pilbara, Australia.
Client
BHP Billiton.
Project Description
The project will continue production growth at BHP Billiton’s WAIO operations and deliver an integrated operation, with a capacity of more than 220-million tons a year on a 100% basis.
The investment includes:
• the development of the Jimblebar mine and rail links, as well as the procurement of mining equipment and rolling stock that will deliver 35-million tonnes a year, with embedded options for expansion to 55-million tonnes a year for incremental capital investment;
• the further development of Port Hedland, including two additional berths and shiploaders, a car dumper and the connection of conveyor routes and associated rail works and rolling stock; and
• port blending facilities and rail yards to enable ore blending, the expansion of resource life and preparation for future growth of the business beyond the inner harbour.
Net Present Value/Internal Rate of Return
Not stated.
Value
The project is estimated at $6.54-billion, including $3.2-billion for the development of the Jimblebar mine; $1.9-billion for Port Hedland and $1-billion for port-blending facilities and rail yards.
Duration
The Jimblebar mine was officially opened on April 23.
Latest Developments
BHP Billiton has awarded a A$145-million contract to the joint venture between project houses Sedgman and Civmec Construction & Engineering at the Jimblebar iron-ore mine, in the Pilbara.
The engineering, procurement, construction and commissioning contract covers the civil, structural, mechanical, piping, electrical and commissioning work for the installation of a new primary crusher and additional conveyor capacity at Jimblebar.
The mine is expected to deliver a Phase 1 capacity of 35-million tonnes a year by the end of 2015.
Longer term, a low-cost option to expand Jimblebar to 55-million tonnes a year and the broader debottlenecking of BHP’s supply chain are expected to underpin capital-efficient growth in its Western Australian iron-ore capacity from about 260-million tonnes to 270-million tonnes a year
Key Contracts and Suppliers
VDM Construction (ammonium nitrate storage facility).
On Budget and on Time?
The project remains well positioned to deliver 220-million tonnes a year of supply chain capacity ahead of schedule and within budget. However, while the Jimblebar mine expansion project is within budget in local currency, the capital cost in US dollars is expected to be 10%, or $340-million, higher than the original budget. This increase has been more than offset by a change in scope and a $400-million reduction in the budget for the WAIO port-blending and rail yard facilities project.
Contact Details for Project Information
BHP Billiton, investor relations, James Agar, tel +61 3 9609 2222 or email James.Agar@bhpbilliton.com.
VDM Construction, tel +61 8 9241 1800, fax +61 8 9241 1999 or email enquiries@vdmgroup.com.au.