The Serra Sul 120 project will expand the production capacity of Vale’s S11D mine and plant, which is the main unit in the Carajás region, with start-up expected to the first half of 2024, the company announced late on Thursday August 13.

The investment will amount to $1.5 billion, and the project will include the opening of new mining areas, the duplication of a long distance belt conveyor and the implementation of new processing lines at the plant, among other measures.

“The expansion of the mine-plant capacity and the development of additional logistics capacity are important steps for the iron ore volume growth, the maximization of margin and the flight-to-quality optimization,” Vale said.

Fastmarkets’ daily iron ore index 65% Fe Brazil-origin fines, cfr Qingdao reached $128.50 per tonne on August 17, down $0.10 per tonne from the previous day’s $128.60 per tonne but 22.7% higher than $104.70 per tonne at the start of the year.

Production at Vale’s S11D unit came to 18.14 million tonnes in the second quarter of 2020, up by 15.3% from 15.74 million tonnes a year before.

As a result of the project’s execution, and the delay in projects this year because of the Covid-19, Vale plans to revise its guidance of investments for 2021, which is currently in $5 billion, and also the guidance for the period 2022-2024.