BHP and Rio Tinto Team Up to Unlock 200M Tonnes of Iron Ore Fines

Two of the world’s largest mining operations just announced a major partnership that could reshape iron ore production in Western Australia. BHP and Rio Tinto signed non-binding memorandums of understanding to jointly extract up to 200 million tonnes of iron ore from their nearby operations — BHP’s Yandi mine and Rio Tinto’s Yandicoogina facility, separated by roughly 80 kilometres.

What’s the Big Deal?

The scale here is staggering. To put it in perspective, BHP’s Yandi alone pumped out 257 million tonnes of iron ore in 2023. Rio Tinto’s Yandicoogina ranks among the company’s top-performing iron ore producers and was a pioneer in deploying autonomous haul trucks and drills at scale. By pooling resources, these operations could extend operational lifespans and squeeze more value from existing infrastructure.

“This unlocks new opportunities while maximizing what we already have in place,” explained Tim Day, BHP’s Western Australia iron ore asset president. Matthew Holcz, Rio Tinto’s iron ore chief executive, added that the partnership will “extend operational life, create additional value, and strengthen support for Western Australian employment and local communities.”

The Iron Ore Fines Advantage

A key component of this deal involves BHP supplying wet iron ore from its Yandi Lower Channel deposit to Rio Tinto for processing. The processed output — primarily Hamersley Iron Yandi fines with low impurity levels — is prized for producing high-iron sinter, especially among steelmakers across East Asia and Southern China. These premium iron ore fines command strong demand in global markets due to their superior metallurgical properties.

The partnership also covers joint development of Rio Tinto’s Wunbye deposit at Yandicoogina, which should boost combined iron ore fines production further.

Timeline and Next Steps

Both companies will launch a conceptual study, followed by an order of magnitude analysis. Approvals from regulatory bodies, joint venture partners (including Mitsui and Itochu on BHP’s side), and engagement with traditional land owners will be necessary before any move forward. If everything aligns, first ore from the combined operations could arrive in the early 2030s.

This collaboration demonstrates how industry giants can drive productivity gains through strategic partnerships, potentially creating a more efficient supply chain for premium iron ore fines into global markets.