Rio Tinto to build Brockman mine five years on from Juukan Gorge

Rio Tinto has pulled the trigger on a new iron ore mine in WA on the same day it wrapped up the takeover of Arcadium Lithium.

Rio Tinto will proceed with a $US1.8bn ($2.84bn) iron ore mine in Western Australia on the same day it wrapped up the $US6.7bn takeover of Arcadium Lithium as part of a big bet on electrification of the global economy.

The mining giant is looking to shore up supply and manage ­issues with declining grades from iron ore operations that ­deliver the lion’s share of its earnings, while increasing its exposure to lithium and copper.

Rio will develop the Brockman Syncline 1 mine to extend the life of its operations in the Brockman region of the Pilbara, in a move expected to create about 1000 jobs during construction.

Rio said the project was planned in consultation with the Puutu Kunti Kurrama and Pinikura (PKKP) traditional owners and the Muntulgura Guruma traditional owners, and received all necessary government approvals.

Rio has worked hard to restore its relationship with the PKKP since destroying 46,000-year-old rock shelters at Juukan Gorge in May 2020.

The Juukan Gorge debacle provoked international outrage and ultimately led to Rio resetting royalty deals with traditional owners in the Pilbara.

Rio Tinto iron ore chief executive Simon Trott.

The funding green light for Syncline 1 comes on the heels of WA’s Bennett and Wright families selling most of their stake in Rio’s Rhodes Ridge iron ore project to Japanese conglomerate Mitsui for $8bn.

Rio iron ore chief executive Simon Trott said Brockman 4 produced 43 million tonnes of iron ore in 2024, with Syncline 1 set to extend the life of the Brockman hub.

“This is good for our business, good for WA and good for the Australian economy,” he said.

“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.”

Mr Trott and his Pilbara team face the task of delivering a replacement mine each year until the end of the decade, while at least maintaining current production and keeping a lid on costs.

Rio has been reviewing its iron ore product mix as it sends increasing volumes of lower-grade material, known as SP10, from the Pilbara and has flagged blending Australian and African product at ports in China.

The blending option will be open to Rio once its high-grade Simandou mine in Guinea starts production late in 2025.

Rio refers to Syncline 1 as a satellite ore body that sits about 8km from Brockman 4 near the Greater Nammuldi mine.

Syncline 1 will have capacity to process up to 34 million tonnes of iron ore a year leveraging existing infrastructure and plants.

It is scheduled to produce first ore from 2027, a year earlier than previously expected under Rio’s mine development schedule.

Rio is working on a string of mine replacement projects, with total annual capacity of about 130 million tonnes in the Pilbara, but has said it wants to reduce its reliance on the steelmaking ­ingredient.

It has touted Rhodes Ridge as one of the world’s largest and highest-quality undeveloped iron ore deposits, and is targeting initial capacity of 40 million ­tonnes a year, with first production by 2030.

The Arcadium acquisition represents Rio’s biggest takeover deal since 2007, with CEO Jakob Stausholm convinced about long-term demand for the battery-making ingredient despite the current price woes.

Rio sees the iron ore division providing about 55 per cent of earnings in the mid-term, down from about 77 per cent over the past few years.

Rio shares closed $2.58 lower at $114.92 on Thursday.