The existing 54-year-old Tom Price Hospital, which was originally built by Hamersley Iron, will be rebuilt to include an emergency department, inpatient ward and consulting rooms for visiting services.

Local communities will also benefit from new medical imaging equipment and state-of-the-art telehealth technology that connect locals with Perth-based medical specialists by phone or video, ensuring they get the best care while removing the need to travel long distances.

As well as servicing the mining towns of Tom Price and Paraburdoo, the new facility will provide care for local Aboriginal communities of Wakathuni, Youngaleena and Bellary Springs, along with the large number of tourists who visit nearby Karijini National Park each year. 

"This will deliver a massive improvement in health outcomes for people in Tom Price and provide a state-of-the-art hospital to replace an ageing facility," WA premier Mark McGowan said.

Rio Tinto Iron Ore chief executive Ivan Vella said the company had a responsibility to work with governments to help improve the future of the region.

"Rio Tinto has a strong commitment to Tom Price. We will continue to invest in projects that support local communities and regions to continue to develop as vibrant, sustainable communities," he said.

Rio is currently building the $1 billion Western Turner Syncline Phase 2 iron ore mine, part of the Greater Tom Price operations.

Contracts valued at over $500 million have been awarded to local Western Australian and Pilbara Aboriginal businesses, including Guma Warnii, Monadelphous, Mondium, Kerman Contracting, Whittens, North West Mining & Civil, MACA Civil, Linkforce and Aerison, by Rio and its principal contractor Mondium.

First production from the new deposits at WTS2 is expected in the second half of 2021.