Rio Tinto and China’s Baowu Steel Group formally opened the $2.7 billion Western Range iron ore mine in Australia. This milestone is a huge step forward in the global iron ore market. Rio Tinto has a 54% interest in the project. At the same time, Baowu—China’s largest steel company—owns the other 46%. That’s important since the mine is projected to address a growing shortfall of iron ore used to make steel. This increase will continue to deepen economic ties between Australia and China.
The Western Range iron ore mine is the world’s most productive mine, with a production capacity of 25 million metric tons a year. This massive production helps make it one of four major players responsible for meeting almost all domestic and global demand for iron ore. The mine is ideally located to support the growing Paraburdoo mining hub for the next two decades. Its unique location ensures a constant supply chain that serves local markets and extends globally.
Total development capital for the Western Range iron ore mine has surpassed $2 billion. This $6 billion dollar investment is an indication that both firms expect continued strong demand for iron ore. They have faith in the operational capabilities of the mine. Rio Tinto and Baowu had already established a robust partnership that exemplifies the growing tide of international cooperation in the mining sector. This partnership underscores the growing importance of Australia and China in the global commodities industry.
Representatives from both companies agree that the project will have a positive impact on regional job creation and economic development. Once the mine is operational, Stibnite is projected to generate thousands of job-years over the course of its operational life and produce significant benefits to surrounding communities. The joint venture reveals a deeper relationship between Australian mining companies and Chinese state-owned enterprises. This partnership will likely set the stage for many more public-private partnerships in the future.