Rio’s West Angelas Expansion Recommended for Environmental Approval

Western Australia’s Environmental Protection Authority (EPA) has given its recommendation for the expansion of Rio Tinto’s (ASX:RIO,LSE:RIO,NYSE:RIO) West Angelas iron ore mine.

Rio announced last October that, along with joint venture partners Mitsui (OTC Pink:MITSY,TSE:8031) and Nippon Steel & Sumitomo Metal (OTC Pink:NPSCY,TSE:5401), it would be investing US$1.55 billion into two iron ore operations in the Pilbara region: West Angelas and Robe Valley.

The plan is for US$579 million of that amount to go toward the development of West Angelas’ C and D deposits. The move comes in an effort to sustain iron ore capacity there and at Robe Valley. Rio aims to continue producing its Pilbara Blend from West Angelas, and claims the brand is the “industry’s benchmark premium product.”

The government’s recommendation comes after a public review for West Angeles. Rio’s plans include expanding open cut mining by 4,100 hectares to a total of 26,700 hectares.

However, the tentative approval comes with a few recommended conditions from the EPA, including the implementation of Managed Aquifer Recharge (MAR). The proposed expansion would pump up to 14 gigaliters of groundwater annually from Karijini National Park; as such, the MAR has been suggested to maintain groundwater levels.

The EPA has also suggested that “rigorous monitoring” take place under an environmental management plan (EMP) to further protect Karijini from surplus water discharge.

“Further conditions in the EMP, and for rehabilitation under an updated mine closure plan, are recommended to minimize impacts of clearing native vegetation and other disturbances to habitat for conservation-significant fauna,” a statement from the EPA reads.

Commenting on the recommendation was EPA Deputy Chair Robert Harvey, who acknowledged the “scientific rigour” of the environmental assessment work done to ensure minimal impact to Karijini.

“This assessment work and recommended conditions constitute a comprehensive approach to (the) management of environmental impacts, following a proactive approach by the proponent and extensive consultation with the EPA,” he said.

The EPA’s report on the West Angelas expansion is now open for a two week public appeal period and is set to close on May 27, after which time the minister for environment will make a final decision on the approval. The asset is located in the state’s Pilbara region.

Rio Tinto shares closed 0.8 percent higher on the ASX on Monday (May 13), ending at AU$96.03. Meanwhile, iron ore prices were down 0.74 percent as of 4:34 a.m. EDT on Monday, hitting US$94.38 per tonne.

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Securities Disclosure: I, Olivia Da Silva, hold no direct investment interest in any company mentioned in this article.