BHP Initiates South Flank Iron Ore Project in Western Australia
BHP has an 85% interest in Mining Area C, where the South Flank project is located, with Itochu Minerals and Energy of Australia Pty and Mitsui Iron Ore Corp. collectively owning the remaining 15%. Total capital expenditure to develop the project is estimated at $3.4 billion, with BHP’s share being $2.9 billion.
The South Flank project will replace production from the 80-million-metricton- per-year (mt/y) Yandi mine, which is reaching the end of its economic life.
BHP President Operations, Minerals Australia, Mike Henry said, “South Flank is a capital efficient project that offers attractive returns. The project will create around 2,500 construction jobs and more than 600 ongoing operational roles and will generate many opportunities for Western Australian suppliers. It will enhance the average quality of BHP’s Western Australia Iron Ore (WAIO) production and will allow us to benefit from price premiums for higher-quality lump and fines products.”
The South Flank project expands the existing infrastructure at Mining Area C and involves construction of an 80-million- mt/y crushing and screening plant, an overland conveyor system, stockyard and train loading facilities, procurement of new mining fleet, and substantial mine development and pre-strip work.
The project is forecast to produce ore for more than 25 years, with first ore targeted for 2021. South Flank ore will contribute to an increase in WAIO’s average iron grade from 61% to 62%, and the overall proportion of lump ore from 25% to approximately 35%.
WAIO is an integrated system of four processing hubs and five mines, connected by more than 1,000 km of rail infrastructure and port facilities in the Pilbara region of northern Western Australia. At each mining hub — Newman, Yandi, Mining Area C and Jimblebar — ore is crushed, beneficiated (where necessary), and blended to create high-grade hematite lump and fines products. Production attributable to BHP totals about 230 million mt/y.
CPB Contractors is a member company of the CIMIC group of companies. Its contract for work at South Flank is scheduled to begin in July and conclude in September 2020.