International mining giant Rio Tinto Ltd (ASX: RIO) said on Friday that it is set to spend an estimated $242 million to add up in the initial $96 million allocated earlier this year to expand the iron ore operational capacity of the company's Dampier Port in the Pilbara region on Western Australia.

Once expansion works have been completed and fully operational, Rio Tinto said that its refurbished Dampier Port facilities would be able to process additional five million tonnes of iron ore, which the company said would lead to an annual capacity of 230 million tonnes by the first quarter of 2012.

Rio Tinto Australia chief executive Sam Walsh said that the boosted capacity would be largely contributed by the ongoing west Pilbara operations at Nammuldi and Brockman 2 with no additional operational cost to the company while at the same time positioning the mining giant to eventually attain a yearly capacity of 330 million tonnes and possibly beyond.

Mr Walsh quickly added that the projected work to ramp up capacity would not impact on Rio Tinto's current operations in the Pilbara region as he noted that the company's "Parker facility at Dampier port is our single largest and busiest port operation."

He pointed out that Rio Tinto "will actively manage this incremental expansion to maintain production and expansion schedules, consistent with our record of orderly and timely delivery of additional iron ore supply."

Rio Tinto said that the port upgrade works would lead to an increased shiploading capacity on its Parker Point facility, with attending spikes in rail stock also set to be expected.

As of 1030 AEST on Friday, Rio Tinto shares were trading at $75.66 per share, declining by 35 cents or 0.46 percent from previous trading sessions.