Rio Tinto (ASX:RIO,NYSE:RIO,LSE:RIO) made headlines after two announcements on March 6.
The mining giant said it will invest US$1.8 billion to develop the Brockman Syncline 1 mine project (BS1), a move that will extend the life of the Brockman region in West Pilbara, Western Australia.
BS1 now holds all necessary government approvals. It has been developed in consultation with the Puutu Kunti Kurrama and Pinikura Traditional Owners and the Muntulgura Guruma Traditional Owners.
The development of the project will help Rio Tinto sustain production from its iron ore operations. It is projected to have a processing capacity of up to 34 million tonnes per year of iron ore.
“Securing this project extends the life of the Brockman hub. This is good for our business, good for Western Australia and good for the Australian economy,” said Rio Tinto Iron Ore Chief Executive Simon Trott in a press release.
“Rio Tinto has been mining iron ore in the Pilbara for almost six decades and our tranche of new mines will ensure we can continue to supply the globe’s ongoing need for iron ore, for decades to come,’ he added.
Construction of BS1 will begin this year and will provide 1,000 jobs. Once operational, the project is set to sustain an average of 600 workers. First ore, originally planned for 2028, is now scheduled in 2027.
In a separate announcement, Rio Tinto confirmed the completion of its acquisition of Arcadium Lithium. First announced in October 2024, the all-cash transaction was for US$6.7 billion.
Analysts from Canaccord Genuity previously estimated that a combined Rio Tinto-Arcadium entity could supply around 10 percent of the global lithium chemicals market by 2030. Rio Tinto also said in its initial announcement that a combination of the companies’ assets would “represent the world’s largest lithium resource base.”
“This establishes us as a global leader in energy transition commodities and one of the leading lithium producers globally with one of the world’s largest lithium resource bases,” the company said in its March 6 release.
“Arcadium’s operations and growth projects are located in geographies where we already have a significant presence, allowing us to leverage our existing infrastructure, networks and expertise to achieve substantial benefits over time.”
Shared jurisdictions by Rio Tinto and Arcadium include Argentina, where Rio Tinto is developing its Rincon project.
The company released an initial mineral resources and ore reserves report for Rincon this past December, saying the project holds 1.54 million tonnes of lithium carbonate equivalent in the measured category, 7.75 million tonnes in the indicated category and 2.29 million tonnes in the inferred category.
Following the acquisition of Arcadium, Rio is now the third largest lithium producer in the world. It follows major companies Albemarle (NYSE:ALB) and SQM (NYSE:SQM).
Australia remains the world’s largest lithium-producing country at 88,000 tonnes in 2024.
Securities Disclosure: I, Gabrielle de la Cruz, hold no direct investment interest in any company mentioned in this article.