15th Jan 2008 08:08
Rio Tinto PLC15 January 2008 This announcement replaces 7721L. The date at the head of the announcement hasbeen amended. No other changes have been made. Energy Resources of Australia Ltd - Fourth Quarter Operations Review (unaudited) 15 January 2008 Ranger Q4 07 vs Q4 06 vs Q3 07 12 mths 07 vs 12 mths 06 Ore Mined (tonnes) 764,372 -51% +9% 2,926,950 -11%Ore Milled (tonnes) 484,333 -13% +1% 1,924,427 -7%Mill Head Grade (%) 0.36 +5% +16% 0.31 +23%Mill Recovery (%) 89.2 +2% +1% 88.2 +1%Production - U3O8 -7% +14% +14% - tonnes 1,553 5,412 - 000 lbs 3,423 11,931 Improved operational performance and an increase in grade of ore mined resultedin full year production in 2007 of 5,412 tonnes, 14 per cent higher than 2006.The 2007 annual production is the second highest annual production on recordfor the Ranger mine. The exceptionally heavy rainfall at the Ranger mine in the March quarter of 2007resulted in an elevated water level in the operational pit, preventing access tohigher grade ore. ERA successfully deployed a number of strategies to increasethe rate of water removal from the operational pit. This resulted in anincrease in the grade of ore as the higher grade was located towards the bottomthe pit. Drummed production of 1,553 tonnes of uranium oxide in the fourth quarter of2007 was 14 per cent higher than the third quarter of 2007 due largely to thehigher mill head grade. This was a result of the higher grade ore mined in thebottom of the pit. Ore milled was one per cent higher than in the third quarterof 2007. Ore mined was nine per cent higher than in the third quarter of 2007 as a resultof improved access due to the lowering of water levels in the pit. The pit wasessentially emptied of water in November. Mining is now focused on stockpilingsufficient ore to lessen the impact on future production should the wet seasonbe unusually heavy. ERA met all delivery commitments by the end of 2007 resulting in sales of 5,324tonnes (2006: 5,760 tonnes). Force majeure, declared after the February/Marchweather event, has now been lifted. Subject to experiencing a normal wetseason, production should be restored to more normal levels in 2008. ERA's average contractual sales price is only partially influenced by the spotmarket due to the portfolio of contracts containing a range of pricingmechanisms entered into when the uranium oxide market was considerably weaker.The spot market price at the end of December was US$89.50 per pound (December2006: US$72.00 per pound). The average realised sales price of uranium oxide forthe year was US$25.06 per pound (2006: US$18.36/lb per pound). Exploration and evaluation During the quarter, the exploration and evaluation program focused on infilldrilling to support the previously announced pre-feasibility study (PFS).Expenditure on exploration and evaluation for 2007 was $14.1 million (2006: $7.2million), including $4.6 million in the fourth quarter. Exploration during thefourth quarter focused on the evaluation of the uranium resource containedwithin the carbonate hosted Lower Mine Sequence (LMS) below the current RangerPit 3 final pit shell. This drilling will form the basis of ongoing studies intothe first quarter of 2008. Vicinity of Ranger's current operating pit Ranger 3 mineralisation is known to extend 'down dip' to the east of the currentpit and has been the focus of exploration efforts in previous quarters. In thefourth quarter, the emphasis of the drilling program shifted to the location ofcurrent pit operations in order to test the LMS hosted uranium mineralisation.Both areas of mineralisation have potential to be exploited with furtherexpansions to mining operations. Figure 1 shows the location of all holes drilled in 2006 and 2007. A total of 66holes were completed during the quarter in the vicinity of the current pit for atotal of 16,281metres (10,571 metres RC metres and 5,710 diamond drilledmetres). Figure 1: Ranger 3 drilling locations (see www.riotinto.com for images) Table 1: Significant intersects in the PFS Area Depth (m) IntervalHole ID From To (m) %eU3O8 S3PD771 51 57 6 0.26 S3PD795 251 262 11 0.49 893 39 50 11 0.13 893 77 84 7 0.25 893 87 92 5 0.38 893 203 217 14 0.12 893 250 268 18 0.16 896 58 76 18 0.10 896 264 281 17 0.25 901 0 5 5 0.38 901 81 92 11 0.16 901 96 111 15 0.33 901 322 329 7 0.28 907 330 336 6 1.44 908 136 147 11 0.20 Note: All intersections were determined using a 0.08% U3O8 cut-off at a minimumfive metres composite, including a maximum of two metres of non mineralisedinternal material. Intersections are down-hole lengths and the true width of theintersections has not been calculated At Ranger 3, extensive reinterpretation of the deposit geology has highlightedthe potential for significant mineralisation to occur at depth, north of thepreviously drilled Ranger 3 Deeps holes. Several historic holes drilled in thisarea returned intercepts of up to 13m with grades to 0.55% U3O8. After thecompletion of the PFS drilling, the focus of exploration in 2008 will move tothis zone. Ranger Project Area Lease Exploration During the quarter, studies have indicated that the application of the seismicmodelling technique has the potential to detect structures that control and hosturanium mineralisation. Orientation surveys are currently planned at Ranger 3 toconfirm the modelling results and refine the technique. If successful, seismicsurveys will be applied at Ranger 18 East and other prospective areas within theRPA to focus the 2008 drilling programs more effectively. About Rio Tinto Rio Tinto is a leading international mining group headquartered in the UK,combining Rio Tinto plc, a London listed company, and Rio Tinto Limited, whichis listed on the Australian Securities Exchange. Rio Tinto's business is finding, mining, and processing mineral resources. Majorproducts are aluminium, copper, diamonds, energy (coal and uranium), gold,industrial minerals (borax, titanium dioxide, salt, talc) and iron ore.Activities span the world but are strongly represented in Australia and NorthAmerica with significant businesses in South America, Asia, Europe and southernAfrica. For further information, please contact: Media Relations, London Media Relations, Australia Christina Mills Ian Head Office: +44 (0) 20 7781 1154 Office: +61 (0) 3 9283 3620 Mobile: +44 (0) 7825 275 605 Mobile: +61 (0) 408 360 101 Nick Cobban Amanda Buckley Office: +44 (0) 20 7781 1138 Office: +61 (0) 3 9283 3627 Mobile: +44 (0) 7920 041 003 Mobile: +61 (0) 419 801 349 Media Relations, US Nancy Ives Mobile: +1 619 540 3751 Investor Relations, London Investor Relations, Australia Nigel Jones Dave Skinner Office: +44 (0) 20 7753 2401 Office: +61 (0) 3 9283 3628 Mobile: +44 (0) 7917 227 365 Mobile: +61 (0) 408 335 309 David Ovington Simon Ellinor Office: +44 (0) 20 7753 2326 Office:+ 61 (0) 7 3867 1068 Mobile: +44 (0) 7920 010 978 Investor Relations, North America Jason Combes Office: +1 (0) 801 685 4535 Mobile: +1 (0) 801 558 2645 Email: [email protected] Website: www.riotinto.com and www.energyres.com.au High resolution photographs available at: www.newscast.co.uk This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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