The Western Australian government has struck a state agreement for the construction of a new A$5.6 billion iron ore export facility in the Pilbara.

The Balla Balla Infrastructure Group, which is 90%-owned by New Zealand's Todd Corp. Ltd., plans to build a port between Karratha and Port Hedland, with a 162-kilometer railway linking it to iron ore deposits in the central Pilbara.

The state agreement provides tenure and a license for the railway, according to a Jan. 23 statement.

Premier Colin Barnett said the agreement includes a requirement for local industry participation and community development plans to be submitted to the government for approval.

"While there are still a number of hurdles for the proponent, it's estimated when it gets underway, the project will generate 3,300 jobs during construction and 910 jobs once operational," he said.

"The proposed export facility will use custom-built barges to transfer ore onto ships, reducing costs and environmental impacts."

Todd Corp. is the majority owner of ASX-listed junior Flinders Mines Ltd., which is developing the Pilbara iron ore project. In mid-November 2016, Flinders received Australian government approval for the expansion of the project to 25 million tonnes per annum from 15 Mtpa.