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Rio pumps $100M in Pilbara infrastructure

RIO Tinto’s Pilbara expansion ambitions in Western Australia are rolling on, with the miner awarding a $A100 million infrastructure contract to Leighton Holdings operator John Holland.

Justin Niessner
Rio pumps $100M in Pilbara infrastructure

The mine works are expected to begin later this month and scheduled for completion in April 2015.

At the peak of the program, John Holland’s workforce is expected to reach 200.

The deal follows immediately on an announcement that Rio achieved its target run rate of 290 million tonnes per annum of iron ore two months ahead of schedule.

In March, the WA government approved $A880 million worth of expansion by the mining giant, which is aiming to reach a Pilbara iron ore production level of 360Mt.

Other recent contracts for projects within this plan have included a $35 million win to Decmil Group for work at the West Angelas deposit and a $300 million job to Brierty for mining and civil work at the Western Turner Syncline project.

John Holland managing director Glenn Palin said the latest award reflected his company’s skill in mine infrastructure delivery.

“More broadly, this project aligns with our strategy of building full service engineering and construction capabilities across the energy and resources sector,” he said.

‘Our specialist engineering business stream continues to grow strongly, offering clients design, engineering, procurement, project management services, materials handling and construction services for customers.”

Rio’s expansion plans were initially announced in 2010 and originally targeted at 283Mtpa.

The aim was lifted in 2012 to reflect increased productivity in the Pilbara mine, rail and port system.

Along with completion of the infrastructure component in September, first ore was loaded at the Cape Lambert port B facility in August.

Rio has said that infrastructure for the 360Mtpa target would be completed by the end of the first half of 2015.

March-quarter production for the company’s Pilbara ops was 63.4Mt, 10% above the previous corresponding period, with Rio’s share being 50.6Mt.

For John Holland, the new work follows on a $4 million deal signed with Engenco last month to supply rail workers and train drivers for the Roy hill iron ore project in WA.

John Holland was awarded a $257 million contract to build the $10 billion project’s railway last year.

Shares in Leighton last closed at $20.90, while Rio last closed at $62.81.

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