The annual output of iron ore will reach 25 million tons
The data show that the West Slope mine contains two deposits (36W-50W and 55W-66W), both within the Hamersley Basin in Western Australia.
The proved mineral resources of the two deposits are 22 million tons and the iron grade is 59.1%. Control mineral resources of 102 million tons, iron grade of 61.5%; The inferred mineral resources are 108 million tons and the iron grade is 61.4%. The confirmed ore reserves of 36W-50W deposits are 109 million tons, and the iron grade is 62.1%. Credible ore reserves are 56 million tons and iron grade is 61.7%. (Mineral resources and ore reserves are calculated on the basis of 100% equity.)
Rio said the West Slope project, with an annual capacity of 25m tonnes of iron ore, would help support the company's Pilbara Blend production at its existing Paraburdoo mining hub. It is understood that the Parabudu Junction currently consists of three operational mines, including the Parabudu, Chana and Dongpo mines.
The West Slope project requires the construction of a primary crusher and an 18-kilometer-long conveyor belt system to connect the mine to the Parabudu processing plant. Construction is expected to begin in early 2023 and production in 2025. About 1,600 jobs will be created on the West Slope during construction and 800 will be needed during the continuing operation phase of the mine, which will be transferred from existing workers at other mines in the Parabudu mining hub.
The two companies also agreed to enter into an iron ore sales agreement at market prices for a total of 126.5 million tonnes of iron ore over about 13 years. The deal represents Baowu's 46 per cent interest in the 275 million tonnes of iron ore expected to be produced at the Xipo project.
Baowu and Rio Tinto have worked together for years
Rio and Baowu set up the Baowu joint venture in 2002 to develop deposits on the eastern side of the Hamersley Range and mines on the western side, with a production ceiling of 200m tonnes. The 200m tonne limit is now expected to be reached through the Dongpo mine partnership alone, with Rio and Baowu continuing their partnership by jointly developing the West Slope mine.
Simon Trott, Rio Iron Ore chief executive, said: "This is a very important milestone for Rio Tinto and our largest customer in the world, Baowu. We have had a close partnership with Baowu for more than 40 years, with our initial joint venture shipping more than 200 million tons of iron ore. The development of the Xipo mine marks the next significant investment phase in our iron ore business. At the same time, Rio Tinto and Baowu will continue to collaborate on low-carbon steelmaking research to explore new ways to reduce carbon emissions and improve environmental performance across the steel value chain."
Mr. Shi Bing, Chairman of Baowu Resources, said, "The signing of the joint venture agreement for the Baowu Ji Xipo Project is of great significance to both companies and we are very grateful for the tireless efforts of both teams to achieve this important outcome. The Borgi Project has been successfully operated for 20 years, which not only brings mutual benefit to both sides, but also gains friendship and trust between us. In the next step, we hope that both sides will deepen the partnership of mutual benefit and win-win results, continue to carry forward the spirit of sincere cooperation, and further expand the cooperation in more areas and more aspects on the basis of joint operation of the Xipo project."
The tie-up is subject to approvals from Rio shareholders, the Australian government, Chinese regulators and the state government of Western Australia, Rio said.
