The donation was made to the charity through the Xstrata Community Program North Queensland to double the house's capacity by 12 bedrooms.

The donation adds to $2 million generated through fundraising and a grant from Ronald McDonald House Australia.

Xstrata Copper chief operating officer Steve de Kruijff said its partnership with Ronald McDonald House would deliver long-lasting benefits to North Queensland families when they needed it most.

"Living in North West Queensland can often mean that specialist care is a long way from home, especially for premature babies and without access to the house a large number of families would need to go to great expense to be with their children while they undergo treatment," Kruijff said.

"We believe that to develop sustainable communities we must help deliver essential health and ancillary services to our host community."

Kruijff made the announcement at the annual Ronald McDonald House North Queensland charity ball in Mount Isa.

Established in 2004, the charity has helped nearly 300 families in Xstrata communities in the region, including 150 from Mount Isa, 20 from Cloncurry and 70 from the Bowen Basin.

"Another compelling factor for us was that a large percentage of those families assisted were also our valued employees and based on those statistics I would say that the house in Townsville is not just a ‘nice to have' service but a necessity," Kruijff said.

Ronald McDonald House North Queensland chairman Paul Rissman said the charity was overwhelmed by the company's support.

"Since opening in 2004, we have provided critical accommodation to over 1400 families while their children are being treated at the adjacent Townsville hospital and we have been full every night," Rissman said.

"Sadly that means we have had to turn away many families every night who require critical accommodation at a time of great need."

He said the partnership with Xstrata would let them help more families in need.

The $3 million project should be completed in September and includes a minor refurbishment of the original facility.