The TSF will give Olympic Dam enough tailings storage capacity to maintain operations at a business as usual rate of 200,000 tonnes per annum of copper and associated products, and allow a ramp-up to 350,000tpa at a later stage.
BHP needs another tailings dam at Olympic Dam to replace the existing facilities being taken off-line.
The mine has been operating since 1988, with BHP taking charge in 2005.
BHP was given approval to raise the height of TSF4 back in 2015, and at the time it was thought this would push back the need for another TSF by at least five years.
The company looked at the cost of raising TSF4's walls even higher but found building another TSF would be cheaper.
Called TSF6, the dam will be situated to the west of TSF4, in Olympic Dam's tailings retention facility.
TSF6 will share a common wall with TSF5, and have a total footprint of 416 hectares.
The two facilities will be run as a single system, with both connecting to the same disposals pipe.
An area of 116ha has already been cleared, with BHP earmarking another 250ha for clearing to make room for soil stockpiles, borrow pits and laydown yards.
Construction is expected to start in November, with commissioning pencilled in for June 2021.