The project will include construction of fourth pellet plant with annual capacity of 8.3 million tons, increasing its capacity to 30.5 million tons.

The work will also include enlargement of the Ponta Ubu maritime terminal in the state of Espirito Santo, increasing mining and processing capacity at the Germano mine, and adding a third line of the 396km iron ore pipeline linking the mine to the pellet plant.

The third line of the slurry pipeline will add 20 million tons per annum to the current capacity, which will not only provide transportation for the project but will leave room for further expansions.

BHP Billiton president Iron Ore Ian Ashby, said the investment builds on its resource and operational strengths and will further improve Samarco’s competitiveness and market position.

The firm expects the first pellet production in the first half of 2014.