Rio Tinto: Third quarter 2011 operations review

Thursday, 13 October 2011 11:06 AM

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Chief executive Tom Albanese said “We have set new quarterly records for iron ore sales and hard coking coal production as our operations recovered from the severe weather experienced earlier in the year. Whilst we are mindful of current market volatility, the fundamentals are holding up well, particularly for bulk-traded commodities. We are operating at full capacity, selling all we produce and our growth programme is on track, supported by the strength of our balance sheet.”

• Global iron ore production of 64 million tonnes (50 million tonnes attributable) was up five per cent on the third quarter of 2010.

• Third quarter iron ore sales of 60 million tonnes (100 per cent basis) from the Pilbara operations in Western Australia set a new quarterly record as the ports and rail recovered strongly from the inclement weather experienced earlier in the year.

• Mined copper continued to be impacted by lower grades at Escondida and Kennecott Utah Copper and was down 32 per cent on the third quarter of 2010.

• Bauxite production was up seven per cent compared with the same quarter of 2010. Aluminium was two per cent higher whilst alumina was five per cent lower.

• Coal production from the Queensland and New South Wales coal mines rebounded from the severe rains in the first half of the year.
- Australian hard coking coal production set a new quarterly record and was 14 per cent higher than third quarter of 2010 and 55 per cent higher than the second quarter.
- Other production from the Australian coal operations favoured semi-soft coal which was 57 per cent higher than the third quarter of 2010 with thermal coal three per cent lower.

• In the first nine months of 2011 Rio Tinto increased its interest in Ivanhoe Mines Ltd from 40.5 per cent to 49.0 per cent and participated in Ivanhoe’s rights offering for a total cost of $1.9 billion.

• Rio Tinto completed the $3.7 billion Riversdale acquisition on 1 August: Benga is on track to be commissioned by year-end with substantial growth options ahead.

• On 12 October, ERA announced it is to raise A$500 million via an accelerated renounceable entitlement offer. Rio Tinto has committed to subscribe for its 68.4 per cent entitlement in full and has indicated that it intends to participate in sub-underwriting any shortfall in the retail entitlement offer.

• On 10 February, Rio Tinto announced a $5 billion capital management programme, which was subsequently increased to $7 billion to be completed by the end of the first quarter of 2012. By 12 October, 69 million Rio Tinto plc shares had been bought back at a total cost of $4.4 billion.

All currency figures in this report are US dollars, and comments refer to Rio Tinto’s share of production, unless otherwise stated.

About Rio Tinto

Rio Tinto is a leading international mining group headquartered in the UK, combining Rio Tinto plc, a London and New York Stock Exchange listed company, and Rio Tinto Limited, which is listed on the Australian Securities Exchange.

Rio Tinto's business is finding, mining, and processing mineral resources. Major products are aluminium, copper, diamonds, thermal and metallurgical coal, uranium, gold, industrial minerals (borax, titanium dioxide and salt) and iron ore. Activities span the world and are strongly represented in Australia and North America with significant businesses in Asia, Europe, Africa and South America.

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David Ovington
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Jason Combes
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Investor Relations, Australia
Dave Skinner
Office: +61 (0) 3 9283 3628
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Christopher Maitland
Office +61 (0) 3 9283 3063
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