15th Apr 2014 09:53
LONDON (Alliance News) - Anglo-Australian mining giant Rio Tinto PLC reported Monday that global iron ore production for the first quarter rose 8% from last year, reflecting the continuing ramp-up of mining operations in the Pilbara region, while production fell compared to the previous quarter due to bad weather.
"Rio Tinto has started the year with a series of performance records as we continue to drive productivity gains across our operations. Our Pilbara iron ore business has again set new benchmarks for production, shipments and rail volumes for the first quarter and we are well on track to reach nameplate capacity of 290 million tonnes per year by the end of the first half of 2014," Chief Executive Sam Walsh said in a statement.
Rio Tinto, the world's second largest iron-ore producer, said global iron ore production for the first quarter increased 8% from last year to 66.4 million tonnes, with Rio Tinto's share also growing 8% from last year to 52.3 million tonnes. Iron ore accounts for roughly two-thirds of Rio Tinto's profits.
At Pilbara, iron ore production grew 10% to a new first quarter record of 63.4 million tonnes from last year, driven by productivity improvements and its continued ramp up towards 290 metric tonnes per year. Sales also set a new first quarter record of 64.2 million tonnes, up 17% from last year.
As such, the company maintained its full-year 2014 production guidance.
However, Rio Tinto said its iron ore production fell 6% when compared with its previous quarter as heavy rainfall, including from the major tropical cyclone Christine closed ports and coastal rail operations at and near the Pilbara site.
"Heavy rainfall associated with this cyclone and other adverse weather conditions in January and February impacted across mine, rail and port operations," Rio Tinto said in a quarterly statement to the Australian Securities Exchange.
The company noted that shipments from the Pilbara exceeded production in the quarter, growing 16% to 66.7 million tons from the previous year but falling 8% in comparison to the previous quarter.
In the quarter, total mined copper production improved 17% on the previous year, primarily benefiting from higher grades at Kennecott Utah Copper and production at Oyu Tolgoi. Bauxite production for the quarter grew 5%, while aluminium production remained flat with last year.
"Our mined copper production benefited from higher ore grades at Kennecott Utah Copper and production ramp up at Oyu Tolgoi and we also had a record first quarter for bauxite, primarily driven by higher production at Weipa," Walsh added.
In the quarter, hard coking coal's production was up 14%, and semi-soft and thermal coal production grew 12% from last year.
The company noted that the full ramp-up is well on track to achieve 290 million tonnes per year nameplate capacity by the end of the first-half of 2014. It is also remains on track for completion of expansion of the port, rail and power infrastructure capacity to 360 million tonnes per year by the end of the first half of 2015.
The ramp-up will see Pilbara mine production capacity increasing by more than 60 million tonnes between 2014 and 2017, with production of 330 million tonnes expected in 2015, compared to production of 250.6 million tonnes in 2013.
Rio Tinto revealed that exploration and evaluation expenditure was USD155 million in the first quarter, sustaining the savings achieved in 2013 whilst progressing the highest priority future growth projects.
Looking ahead to 2014, the company said production guidance remains unchanged at about 295 million tonnes from its global operations in Australia and Canada, subject to weather constraints.
Rio Tinto shares were trading down 2.0% at 3339.00 pence per share, the second biggest faller on the FTSE 100 Tuesday morning.
By Tom McIvor; [email protected]; @TomMcIvor1
Copyright © 2014 Alliance News Limited. All Rights Reserved.
Related Shares:
Rio Tinto