Mount Gibson Iron says its latest advice from the weather bureau is that Magda will track directly over Koolan Island as a category three storm about midday on Friday.
"Mount Gibson Iron is currently making all necessary preparations, including evacuating 228 employees from Koolan Island as a precautionary measure," the company said.
The company says 64 emergency crew members would remain on site, moving to a purpose-built cyclone shelter on the island.
A second tropical cyclone off the Queensland coast is predicted to strengthen overnight, but experts say it is unlikely to make landfall.
Tropical cyclone Neville, a category one cyclone, has prompted warnings for coastal areas from Cape Melville to Cooktown.
Cyclone warnings issued
Gales with damaging gusts to 95km/h may develop on the coast between Cape Melville and Cooktown over the next 24 hours, the Bureau of Meteorology said.
Cyclones hampered operations at Koolan, Mount Gibson's second mine, in early 2008.
Western Australia's Fire and Emergency Services on Thursday issued a blue alert for communities between Kalumburu, in the state's far north, and Cape Leveque, south of Cockatoo Island.
The Bureau of Meteorology has issued a cyclone warning for the area, with Tropical Cyclone Magda about 250km north-west of Cockatoo Island and 380km north of Derby.
It is moving south-southeast at 14km/h and could intensify into a category three cyclone on Thursday night as it approaches the Kimberley coast, the bureau says.
Wind gusts are expected to reach speeds of 220km/h near the cyclone's centre on Friday.
