Rio Begins Appeal Against Decision to Block Coal Mine Expansion

Rio Tinto Group, the world’s second-largest mining company, said it began today an appeal against a decision to block a coal mine expansion in Australia’s New South Wales state.

“We are committed to doing everything we can to avoid the loss of production and associated jobs for our workforce of 1,300 people at Mount Thorley Warkworth mine and that is why we are proceeding with this appeal,” Harry Kenyon-Slaney, Rio’s energy chief executive, said in an e-mailed statement. “We’ve already spent close to four years trying to secure approval for this mine extension and it is unlikely the legal system can deliver an outcome in time to avoid impacts.”

London-based Rio’s plan to expand the coal mine in the Australian wine-growing region of Hunter Valley was rejected in April by a judge, overturning a government approval.

Coal & Allied Industries Ltd., a unit of Rio Tinto, planned to extend the operation’s life and expand the area the company is mining. Warkworth has a permit to operate the existing mine until 2021 and sought to extend it to 2031. The mine has a production capacity of 10 million metric tons of thermal coal, Rio said on its website.

Rio Tinto, which together with Mitsubishi Corp. bought out the minority holders in Coal & Allied in 2011 for A$1.53 billion ($1.4 billion), hired Deutsche Bank AG to help reduce its interest in the venture to as low as 51 percent from 80 percent, the Wall Street Journal reported April 3, citing unidentified people.

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