Rio and BHP Billiton, the second biggest Pilbara mining company, are also pouring billions into upgrading roads, railways, and ports—the foremost obstacle to unfettered growth of the iron-ore industry in Western Australia.
The rapid mining expansion has been an enormous boon to sparsely populated Western Australia, where economic growth has rivaled that of hot economies in countries like China and India.
At Odds Over the Land
But many are concerned that the boom is happening too fast—and that local inhabitants and wildlife will pay the price.
When iron-ore mining started in the Pilbara in the 1960s, the companies often clashed with Aborigines, whose claims to the land were not recognized by the Australian government until 1992.
When proposing new mines or expanding existing ones, mining companies now typically negotiate with indigenous groups, who can press for compensation and for assistance in preserving cultural artifacts.
Simon Hawkins, director of the Pilbara Native Title Service, said the current boom caught many groups by surprise and has created a new urgency to protect their lands and try to squeeze the best concessions they can from the mining companies.
Rio Tinto spokesman Gervase Greene acknowledged the company's relationship with indigenous Australians had been combative.
"Ten years ago we decided there had to be a new way," he said.
Since then, the company has hired more Aboriginal workers and contracted with indigenous companies. It also started consulting with Aborigines to preserve cultural sites.
BHP Billiton has similar programs and recently announced it awarded a $300 million contract to Ngarda Civil and Mining to manage BHP's Yarrie Mine.
Still, the two sides are often at odds.
Darren Injie, from the Yinhawangka group of the Pilbara, is one who feels the companies, given the amount of money being made, fall far short in their negotiations with Aboriginal groups.
"The employment I don't see as a benefit," Injie said, noting the concession is small considering what the Aborigines have lost.
"Those minerals are ours," he said. "The waters are ours."
Other local natives, like Martu Idja Banyjima elder Slim Parker, point out that Aboriginal culture is deeply connected to the land and water and that the mining companies show little understanding of this in spite of the ongoing negotiations.
For example, a nearby mine has plans to triple the amount of water it will discharge into Weeli Wolli spring, a spot of spiritual importance for the Martu Idja Banyjima.
"We don't know the minerals that are in the water," he said. "Also, with the water running all the time, we don't know if it is going to drown the trees."
Worry Over Water
The native titleholders are working in large part to protect the spare waterways that run through the Pilbara.
Environmentalists, too, are wondering whether the rapid expansion will have unforeseen impact on the precious resource.
"Water ecology issues are starting to become visible," Mudd, the civil engineering professor, said.
There is a drawdown effect on aquifers around mines, which can force nearby vegetation to wither, he pointed out.
Elsewhere, where mines are forcing water out from underground reservoirs and into nearby creeks, vegetation is cropping up in formerly barren spots.
Mining companies say they are working to manage the environment effects of their work.
A BHP Billiton spokesperson, for example, said that the company is constantly looking for ways to reduce or recycle its water use in the Pilbara.
"The new water target is to achieve a 10 percent reduction in freshwater consumption per ton of iron ore between 2002 and 2012," he said. "This means that even as production and exports of iron ore continue to increase, water usage will remain essentially the same due to more efficient use of this precious resource."
But some environmentalists are worried that it will become increasingly difficult to maintain the environment as mines expand and proposed mines come online.
That, combined with prolonged drought across Australia, have some saying more study is needed before proceeding with all the proposed projects.
"We are industrializing a natural landscape in ways that are unprecedented," said Tim Nicol, a spokesman for the Conservation Council of Western Australia.
"We don't know how this is going to affect the water, so why not just slow down until we do?"
Feeling Left Behind
More than $130 million in minerals passes through Port Hedland alone every week, on two-mile-long (three-kilometer-long) trains that shuttle between the mines and the barges bound for Asia.
But most of the locals feel the money is passing them by.
Because many workers don't want to relocate to the dusty outback, mining companies fly workers in from elsewhere for two-week stints and put them up in hotels, depriving Pilbara towns of the benefits of a high-earning permanent population.
Those filled hotels and hostels are also driving away once staple tourism dollars.
An already serious labor shortage is worsening as employees in town businesses are continually lured away by mining company bosses who offer better wages.
And the boom has created a housing shortage, forcing land values sky high and giving people little choice but to work in mining or leave town.
The result is that schools, restaurants, and hospitals are understaffed across the Pilbara. Banks in Port Hedland can't always hold regular hours for lack of tellers.
But the ultimate insult may be the pub that closed and now houses mining company employees.
"We are being called 'the engine room of the Australian economy,'" noted Bill Dziombak, president of the Port Hedland Chamber of Commerce.
"But we are just an outback town that needs help."
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