Iron ore mining in Western Australia, in the 2018–19 financial year, accounted for 54 percent of the total value of the state's resource production, with a value of A$78.2 billion. The overall value of the minerals and petroleum industry in Western Australia was A$145 billion in 2018–19, a 26 percent increase on the previous financial year.
Western Australia's iron ore output for 2020–21 was 838.7 million tonnes, the second-highest figure after 2017–18. The bulk of Western Australian ore went to China, which imported 82% of 2021 production, followed by Japan and South Korea, with 6% each. The state has the world's largest reserves of iron ore with 29% of the world's iron ore, followed by Brazil with 19%, Russia with 15% and China with 12%.
In 2020–21 the Western Australian Government received A$9.8 billion in royalties from the iron ore mining industry in the state. The remaining life of the Pilbara iron ore fields has been estimated as 65 years from 2021.
History Australian Iron and Steel had leases for the iron ore deposit on Cockatoo Island, in Yampi Sound, and later secured leases over deposits on the neighbouring Koolan Island. The company bought a schooner, Geraldton, carried out survey work on Cockatoo Island in 1929 and 1930, and built some accommodation buildings and a reservoir on the island in 1932. The housing was deserted by May 1934. Cecil Hoskins tried to obtain financial support from Japanese mining interests to develop the Yampi Sound ore deposits—some of the ore was to be exported to Japan—but discussions apparently broke down in early 1935. After the end of the Second World War, the company, now a BHP subsidiary, began developing the deposit on Cockatoo Island, and its first ore shipment was in 1951.
Iron ore mining also took place at Wundowie and later at Koolyanobbing, to feed the Wundowie charcoal iron blast furnaces, from 1948 to 1981. Koolyanobbing also supplied ore to a BHP owned blast furnace at Kwinana, from 1968 to 1982. Since that time, apart from a short-lived direct reduced iron plant, at Port Hedland, no iron has been smelted in Western Australia, and almost all ore mined has been exported.
While the Pilbara iron ore deposits were known, such as the Mount Whaleback deposit discovered in 1957 by Stan Hilditch, it was not until 1960, when the Australian government lifted the embargo on iron ore exports that it had put in place because of concerns the mineral was in short supply, that mining began in earnest.Newman The Sydney Morning Herald, published: 8 February 2004, accessed: 10 November 2010 Up until the mid-1960s, iron ore production in Western Australia, and Australia as a whole, was negligible, in the range of less than 10 million tons a year. By the mid-1970s, this figure had reached 100 million tonnes, with the majority coming from Western Australia. Production slightly declined in the 1980s, but it improved in the 1990s, reaching 150 million tonnes for the country by 1997 and 200 million tonnes by 2003.Western Australian Mineral and Petroleum Statistic Digest 2008-09 Department of Mines and Petroleum website, accessed: 26 November 2010
The first mine in the Pilbara, the Goldsworthy mine, was developed in 1965 by Mount Goldsworthy Mining Associates, a joint venture between the British-owned Consolidated Goldfields (Aust) Pty Ltd, Cyprus Mines Corporation of Los Angeles, and Utah Construction & Mining Company of San Francisco. A private railway line, the Goldsworthy railway, as well as port facilities at Finucane Island, Port Hedland, were also constructed. On 1 June 1966, the first shipment of iron ore from the Pilbara left on board Harvey S. Mudd.History of the Iron Ore Industry and the Pilbara BHP Billiton website, accessed: 10 November 2010
BHP's operations in Newman date back to 1968, when the Mount Whaleback mine was opened, the biggest single open-pit iron ore mine in the world. A new town, Mount Newman, was constructed, as well as a 426 kilometre railway line, the Mount Newman railway. The first train left Mount Newman on 1 January 1969 and the first shipment of Newman ore left port on 1 April 1969 on board of Osumi Maru. Newman remained a "closed" company town until 1981.
Rio Tinto's iron ore operations in the Pilbara began in 1966,Pilbara Rio Tinto Iron Ore website, accessed: 6 November 2010 with the Mount Tom Price mine opened that year, becoming the company's first mine to open in the Pilbara.The Australian Mines Handbook – 2003-04 edition, editor: Ross Louthean, publisher: Louthean Media Pty Ltd, page: 242
Overview Exploration
In 2008–09, expenditure for exploration in iron ore in Western Australia increased by 33 percent compared to the previous financial year, 2007–08. The A$560 million spend on iron ore exploration accounted for 45 percent of all mineral exploration expenditure in the state.
Production
The bulk of iron ore production in Western Australia comes from the Pilbara region of the state. A number of mines however are also located in the Mid West and Kimberley regions as well as in the Wheatbelt.
The big two producers, Rio Tinto and BHP, accounted for 90 percent of all iron ore production in the state in 2008–09, with the third-biggest producer being the Fortescue Metals Group.
Rio Tinto operates twelve iron ore mines in Western Australia, BHP seven, Fortescue two; all of those are located in the Pilbara region.
Railways Pilbara region
The three largest iron ore producers operate private rail networks to transport ore from their mines to ports on the coast.
BHP operates the Goldsworthy railway and the Mount Newman railway, both terminating at Port Hedland.
Rio Tinto operates the Hamersley & Robe River railway, formed in a 2001 merger of the Hamersley and Robe River railways. The two lines terminate at Cape Lambert and Dampier.
FMG's Fortescue railway, a relative newcomer, started operation in 2008. The line terminates at Port Hedland.Infrastructure: Rail Fortescue website, accessed: 6 November 2010 Before deciding to construct its own line, FMG applied to the National Competition Council, on 15 June 2004, to use part of the Mount Newman railway and also part of the Goldsworthy railway.Mt Newman Railway National Competition Council of Australia website, accessed: 6 November 2010
In June 2010, the Australian Competition Tribunal ruled that FMG would be granted access to Rio Tinto's Robe River line and BHP Billiton's Goldsworthy line but not to the busier Hamersley and Mount Newman lines.Junior miners win limited access to Pilbara rail network lloydslistdcn.com.au, published: 1 July 2010, accessed: 4 November 2010Watchdog 'can demand Pilbara rail expansion' The Australian, published: 13 May 2010, accessed: 4 November 2010 Treasurer Wayne Swan suggested that several advantages would accrue from access to the rail lines by third parties. It would increase competition, reduce duplication of infrastructure, and reduce environmental damage. news.com.au, published: 28 October 2008, accessed: 4 November 2010 Atlas Iron, another junior iron ore miner, is hopeful to come to terms with BHP Billiton in regards to using some of the company's rail infrastructure, the Goldsworthy railway, in the future. BHP, in late 2010, had agreed to a joint feasibility study into how an arrangement might work.Atlas Iron optimistic about using BHP rail line to Port Hedland ABC Rural, published: 23 November 2010, accessed: 24 November 2010
Access to the rail networks by third parties is governed by the State Agreements Act.Report on Current Transport and Communications Infrastructure in the Pilbara Murdoch University, accessed: 4 November 2010
Westrail region Other mines connect to port using the state government-owned railways. Examples are Windarling Range and Koolyanobbing – from Koolyanobbing to the port of Esperance; Karara mine using the Karara railway to link to the state network at Morawa; Koolanooka using a 60 km spur line linking to the state network at Morawa; and Mt Gibson trucking to an ore loading siding at Perenjori.
Ports In the Pilbara, iron ore is shipped from Port Hedland, Dampier and Cape Lambert. The latter two ports are exclusively used by Rio Tinto, while Port Hedland is used by BHP, FMG and Atlas Iron.
Port facilities at Port Hedland consist of Nelson Point and Finucane Island, both BHP, and Herb Elliott Port, used by FMG. In Dampier, ore is shipped from Parker Point and East Intercourse Island.
The non-Pilbara mines ship their ore out of other ports: Windarling Range ships from the port of Esperance; the Jack Hills, Koolanooka, Mungada and Mt Gibson mines ship from Geraldton.Koolanooka/Blue Hills (Haematite) Sinosteel Midwest website, accessed: 28 November 2010Jack Hills Iron Ore Mine Crosslands resources website, accessed: 28 November 2010
Projects
BHP is currently spending A$1.85 billion on its Rapid Growth Project 4, aimed at increasing its annual iron ore output to 155 million tonnes. To achieve this, upgrades to both mines and port facilities are necessary. The project is scheduled for completion by 2010. As a follow-up, Rapid Growth Project 5, with a budget of A$4.8 billion, targets a further production increase of 50 million tonnes annually. Additionally to upgrades at the mines and ports, it will also include duplication of existing railway lines and is scheduled for completion in late 2011. The Jimblebar mine is part of another expansion project, launched in 2010 and aimed at increasing production from the Pilbara mines to 240 million tonnes of iron ore annually by 2013. The expansion of Jimlebar, together with an expansion of the inner harbour at Port Hedland and works on the duplication of rail tracks is estimated to cost A$2.15billion.BHP approves a $2bn expansion of WA iron ore operations The Australian, published: 29 January 2010, accessed: 14 November 2010 The project is titled Rapid Growth Project 6.BHP boosts Pilbara despite EU threat to Rio joint venture The Australian, published: 30 January 2010, accessed: 14 November 2010
Rio Tinto declared its intent to expand the Hope Downs mine, spending a further A$1.78 billion on its new Hope Downs 4 project, scheduled to produce 15 million tonnes of iron ore annually by 2013.Rio Tinto to invest $1.78b in Hope Downs The Sydney Morning Herald, published: 30 August 2010, accessed: 7 November 2010Rio Tinto proceeds with Hope Downs iron project ABC Rural, published: 31 August 2010, accessed: 7 November 2010 Rio has commenced construction on its new Western Turner Syncline project. Rio Tinto allocated a further A$1.24 billion in early December 2010, to expand the Brockman 4 mine to 40 million tonnes per annum, from 22, as well as develop its Western Turner Syncline project, raising planned production there from 6 to 15 million tonnes, with the aim of increasing the Pilbara production to 283 million tonnes per annum by late 2013. The expansion would make Brockman 4 Rio Tinto's second-largest mine in the Pilbara.Rio Tinto signals $1.24bn ore expansion The Australian, published: 2 December 2010, accessed: 4 December 2010 The company has also begun further construction at the port at Cape Lambert, which is scheduled to undergo a further expansion, to be completed by 2012. The new expansion is scheduled to cost A$276million.John Holland lands Cape Lambert port expansion for Rio The Herald Sun, published: 3 September 2010, accessed: 8 November 2010 The expansion is part of a plan to raise Rio's annual production from the Pilbara from 220 to 330 million tonnes annually by 2016. To achieve this, the Cape Lambert port capacity will be expanded to handle an additional 100 million tonnes annually.Rio announces $226m expansion at Cape Lambert The West Australian, published: 14 July 2010, accessed: 8 November 2010