Rio Tinto will expand output from one of the world’s premier bauxite deposits following approval of the $1.9 billion Amrun project.
Amrun involves the construction of a bauxite mine and associated processing and port facilities on the Cape York Peninsula in north Queensland.
“Amrun is one of the highest quality bauxite projects in the world,” Rio Tinto chief executive Sam Walsh said.
“It is a tier one asset that will deliver significant benefits to all our stakeholders.
“In addition to generating attractive returns, with mining costs in the first quartile of the industry cost curve, it will provide jobs and strengthen the economy for the people of Cape York and Queensland for many decades.
“This long-life, low-cost, expandable asset offers a wide variety of development options and pathways over the coming decades. We are establishing Cape York bauxite as the product of choice for the Chinese seaborne market with consistent quality, security of supply and strong technical marketing support. Amrun will be significant in helping to meet growing bauxite demand from China.”
The planned initial output is 22.8 million tonnes a year, replacing production from the depleting East Weipa mine and increasing annual bauxite exports from Cape York by around 10 million tonnes.
Production and shipping are expected to commence in the first half of 2019, ramping up to full production by the end of the year. The project’s design provides options for future expansion to 50 million tonnes a year.
The majority of capital expenditure for the Amrun project is scheduled for 2017 and 2018.