Rio Tinto and Hancock to Move Forward with “Hope Down 4”

Mining giant Rio Tinto (RIO) and Hancock are currently reviewing their plan to go for generating as much as 30 million tonnes of iron ore annually which worth $US1.8 billion at the present market price. The targeted amount of ore is expected to be mined from a new Pilbara development where mining is likely to start as early as 2012. The project that is known as “Hope Down 4” will be the first major mine development for Rio Tinto under its plan to increase its capacity in the mines locates in Western Australia if the project gets approval. Although the development would be smaller than Rio’s Yandicoogina mine which currently generates more than 50 million tonnes of iron ore a year, but it will be one of the largest iron mines for the company.

The Hope Down 4 mine is an important part of Rio Tinto’s new plan of expanding its business with an increased Chinese demand for iron ore. It is also expected to help the company with its recent debt problems. However, the proposal will need to go through a WA public environmental review. In addition to this, Rio Tinto is also working on its plan to establish a merger with another mining giant BHP Billiton for the Pilbara Iron ore operations, a proposal that needs to get through the regulators of the European competition.

The Hope Down 4 was investigated by Rio and Hancock more than two years ago but since then not much progress was made regarding it due to the global financial crisis. According to the environmental review documents which were released this month, Rio Tinto and Hancock were planning to generate 30 million tonnes of top grade, high phosphorous Brockman iron ore per year from Hope Down 4 for 25 to 30 years, something that possibly will double the production from the Rio-Hancock joint venture.