Rio Approves $1.2 Billion Spend on Iron Ore Expansion
Stock Chart for Rio Tinto PLC (RIO)
Rio Tinto Group, the world’s third- largest mining company, approved $1.2 billion in spending to expand its iron ore mines in Western Australia as part of a plan to boost output by half.
The funds will be used to expand the Brockman 4 and Western Turner Syncline mines, the London-based company said in a statement to the Australian stock exchange. The approval brings announced spending since July to $7.2 billion, it said.
Chief Executive Officer Tom Albanese is boosting investment in mines by 50 percent next year and plans $13 billion of expansions over 18 months to the end of 2011. Rio, the second- largest exporter of iron ore, is raising annual capacity by 50 percent over five years to 333 million metric tons.
The Brockman mine will be expanded to 40 million tons a year of capacity, from 22 million tons currently, and annual capacity at the Western Turner Syncline mine will be increased to 15 million tons from 6 million tons, it said in the statement. Rio is studying the expansion of a third mine, Nammuldi, and an investment decision is expected next year, it said.
The company gained 1.1 percent to A$83.10 at the 4:10 p.m. Sydney time close on the Australian stock exchange. Rio Tinto is Australia’s biggest exporter of the steelmaking raw material.
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