Rio Tinto (ASX:RIO) and Gemco Rail are creating a partnership to bring local iron ore rail car manufacturing and bearing maintenance to the Pilbara region of Australia. Building rail cars in the region is an industry first.
Rio Tinto expects to invest approximately $135.4 million (A$150 million) to buy 100 locally built ore rail cars over six years. The company also agreed to invest in bearing refurbishment for 10 years.
The first 40 cars will be built in Gemco’s existing facility in Forrestfield while an additional plant is built in Karratha. The new plant will play a significant role in the local and Indigenous economies as well as create new jobs. When ore cars are built in Pilbara, 150 truck journeys from there to Perth and about 300 tonnes of carbon dioxide will be eliminated.
Once the new plant is operational at the end of 2024, Gemco expects to build an average of 10 cars per year, replacing cars from Rio Tinto’s existing fleet.
Rio Tinto produces about 325 million tonnes of iron ore in the Pilbara and employs 15,000 people. Details at www.RioTinto.com/operations/australia/pilbara#.
