Wed, Jul 17, 2013 - Page 15 News List

Rio Tinto reports record first-half iron ore output

AFP, SYDNEY

Anglo-Australian mining giant Rio Tinto said yesterday that it saw record iron ore output in the first half of the year, adding that the expansion of capacity in Western Australia’s Pilbara was on track.

It said the production, shipments and rail volumes came despite unseasonal wet weather in the Pilbara and a conveyor belt breakage resulting in one of five ship loaders being sidelined for almost three weeks.

The firm added in its second quarter report that iron ore output at its mines in Australia and Canada came in at 66 million tonnes for the three months to last month, up 7 percent on the same period last year.

“Our iron ore operations continue their impressive performance, with period-on-period productivity improvements,” Rio Tinto chief executive Sam Walsh said.

“One of our key priorities this year is to deliver our growth projects. Despite some challenging weather conditions, our Pilbara 290 iron ore expansion remains on track to deliver first tonnes by the end of this quarter,” he added.

Softer commodity prices and slowing demand from China have forced resources companies to back-pedal on some projects. However, despite this Rio said it was evaluating a number of other options for further mine capacity growth, including the potential development of new mines and increased productivity at existing mines.

“First half 2013 sales of 111 million tonnes set a new record for a first half and were 2 percent higher than the same period in 2012,” it said in the report.

“Second quarter sales were lower than production due to interruptions in shipping caused by the conveyor belt breakage and significant flooding in the Pilbara,” it added.

As miners engage in aggressive cost-cutting, Rio said it was well on track to meet its US$750 million targeted reduction in exploration and evaluation spend this year, with outlays in the first half down by US$483 million over the same period of last year.

On iron ore, Rio said this year’s production guidance was unchanged at approximately 265 million tonnes from global operations in Australia and Canada, subject to weather constraints.

It expects its share of Australian hard coking, semi-soft coking and thermal coal production to be 8.5 million tonnes, 4 million tonnes and 21 million tonnes respectively this year.

Walsh said a new milestone had been reached in the company’s operations in Mongolia, where its Oyu Tolgoi copper-gold mine had made its first shipment of copper concentrate to China.

Rio said this represented “the culmination of a three-year, US$6.2 billion project to build the first phase of the world’s top-five copper mines.”

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