BHP Billton Plc
Press Release
Date:  3 April 2002
BHP BILLITON APPROVES MINING AREA C DEVELOPMENT AND
PORT HEDLAND CAPACITY EXPANSION
BHP Billiton today announced approval for the development of a new iron ore
mine at Mining Area C and an expansion of its Pt Hedland port and rail
facilities, both in the Pilbara region of north Western Australia.
Capital costs for the two projects are expected to be US$213 million for
development of the new mine (BHP Billiton share US$181 million) and US$351
million for the Port and Capacity Expansion (BHP Billiton share US$299
million).
The Mining Area C development has the potential to increase iron ore
production by up to 15 million tonnes per annum (mtpa) by 2011. The Port and
Capacity Expansion (PACE) will increase BHP Billiton's export capacity from
67mtpa to 81mtpa by 2004 and provide the foundations for expansion to over
90mtpa by 2011, an increase of more than 40 per cent.
As part of the Mining Area C development, BHP Billiton has entered into a
joint venture with POSCO, whereby POSCO will acquire a 20 per cent interest
in the `C Deposit' section of Mining Area C.
Under the agreement POSCO has committed to purchase a minimum of three
million tonnes per annum of MAC ore following initial ramp-up and to
maintain a long-term strategic alliance with BHP Billiton for supply of
other iron ore products.
BHP Billiton Deputy CEO Brian Gilbertson said: "The development of Mining
Area C signals a new era of growth in our Western Australian iron ore
operations and further consolidates our strong relationship with a core
customer and one of the most efficient and innovative steel makers in the
world.
"For BHP Billiton and its Goldsworthy JV partners this is the first step in
unlocking the significant Marra Mamba resource in Mining Area C, which will
target the growing requirements for high `Value in Use' ore from Asia's
direct blast furnace steelmakers.
"In addition, the development of Mining Area C marks our determination to
maintain BHP Billiton's share of the global seaborne market for iron ore."
All necessary approvals and agreements are in place for construction of the
new mine to commence immediately, with full-scale mining of the `C Deposit'
sub-lease to begin in 2003. Development of the PACE project will commence
later this calendar year subject to final regulatory approvals.
"The staged expansion of the port facilities over the next decade will
provide system capacity to ensure we can meet the predicted growth in demand
for both the new Marra Mamba ores and our existing Brockman and Yandi ores
in the Asian region," Mr Gilbertson said.
Mining Area C is located 37 kilometres from BHP Billiton's existing Yandi
mine and contains the largest undeveloped Marra Mamba resource in the
Pilbara.
The resource is currently estimated at 890 million tonnes with significant
further exploration potential. `C Deposit' is located on the northern flank
of Mining Area C and contains a proven reserve of 161 million tonnes and a
probable reserve of 29 million tonnes (total 189 million tonnes rounded).
The new Mining Area C development will include:
The development of a 15mtpa mine and processing facility to produce Marra
Mamba lump and fines;
Construction of a 38km railway spur, linking Mining Area C operations to
Yandi;
Installation of infrastructure including power, water, airstrip and access
roads, and
Accommodation facilities for a 500-strong construction workforce and a
permanent operations workforce of 150.
Expansion of the port facilities will include:
Developing a new Western Stockyard;
A major upgrade and enhancement of dust suppression systems;
Upgrading the under harbour tunnel conveyor from 4,500 tph to 10,000 tph;
Establishing an additional lump re-screening facility, and
Extension of existing shipping berths.
The first phase of the port expansion will increase capacity from 67mtpa to
81mtpa by 2004 and will require a workforce of approximately 400. About 20
new permanent positions will be created by the port expansion.
Capital expenditure for PACE includes the installation of more modern and
efficient dust suppression systems at the port facility, expected to cost
about US$33 million (BHP Billiton share US$28 million).
Under the POSMAC joint venture arrangement, ownership of the `C Deposit'
development will be BHP Billiton 65 per cent, POSCO 20 per cent, CI Minerals
Australia Pty Ltd 8 per cent and Mitsui Iron Ore Corporation 7 per cent.
ORE RESERVE STATEMENT
The information in this report that relates to Mineral Resources and Ore
Reserves is based on information compiled by M. Kneeshaw (resources) and P.
Schultz (reserves) who are employees of BHP Billiton and who are a Fellow
and Member respectively of The Australasian Institute of Mining and
Metallurgy.
M Kneeshaw and P Shultz have sufficient experience which is relevant to the
style of mineralisation and type of deposit under consideration and to the
activity which they are undertaking to qualify as a Competent Person as
defined in the 1999 Edition of the "Australasian Code for Reporting of
Mineral Resources and Ore Reserves".  M Kneeshaw and P Shultz consent to the
inclusion in the report of the matters based on their information in the
form and context in which it appears.
Further information can be found on our Internet site:
http://www.bhpbilliton.com