Fortescue Metals will lop off another $US500 million ($A665 million) from its debt pile next week, after issuing a repayment notice for part of its 2019 term loan.
The iron ore miner said the repayment to be made at par from accumulated cash and scheduled for June 28 will save about $US21 million in interest each year.
"Cashflow generation from our operational performance and cost reductions have allowed Fortescue to continue to repay debt," chief financial officer Stephen Pearce said.
The world's fourth biggest iron ore exporter has taken advantage of firmer iron ore prices in 2016 to scale back its massive debt pile, and has also raced to cut costs amid a prolonged mining downturn.
Including next week's repayment, Fortescue has slashed its debt by $US2.9 billion in the 2015/16t financial year.
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Fortescue's debt peaked at nearly $US13 billion in 2013, but it has since prioritised repaying the loans, as it races to stay afloat amid an extended slump in commodity prices.
The company had gross debt of $US9.5 billion at the end of June 2015.
The miner in April said it had trimmed cash costs by more than 40 per cent from a year ago, and it has also been helped by a rebound in iron ore prices in recent months.
Spot prices, which slumped to a decade-low of $US38 a tonne late in 2015, have largely stayed above $US50 a tonne since March.
Fortescue shares were up 19 cents at $3.45 at 1250 AEST.
