i am currently in the US but was in the same situation when I submitted my full application. I submitted my full application with the copy of my passport (the one near expiry). BUT what i did was I made a cover letter informing the visa office that I am planning renew my passport and will send them as soon as I have it done.
After a month of submitting my full application, I got my renewed passport and sent it to the visa office. So far, so good. I just had my medical examination last week.
I did the same as SkilledPro.
But since you just received your letter from CIO, I guess you still have time to renew your passport. Have your passport renewed, and submit it as soon as it is available. Remember to write a cover letter that you are updating your passport, and to provide a photocopy of your latest passport.