Mining giant Rio Tinto has announced a $299 million project to construct sustainable water supply for its iron ore operations in the Pilbara region of Western Australia. The plant will have a planned capacity up to the 333 million tonnes (Mt/a).


The coastal water supply project, which involves construction of a new borefield and pipeline system, will be completed by mid-2013, coinciding with the first ore from the planned increase in production capacity to 283 Mt/a.


Rio Tinto will build, own and operate the new borefield, located in the lower Bungaroo Valley, 35 kilometres south east of the town of Pannawonica, with an annual capacity of 10 gigalitres (GL/a).


Under the proposal, which has been agreed in principle with the Government of Western Australia, Rio Tinto will surrender its existing priority entitlements to the Millstream water supply, the system Rio Tinto constructed and financed 40 years ago. In return, the Government has agreed to amendments to secondary processing obligations.