17th Dec 2007 09:53
Rio Tinto PLC17 December 2007 Rio Tinto approves US$991 million Kestrel Mine extension 17 December 2007 Rio Tinto has announced a significant new investment in its coal productioncapacity in the Bowen Basin region of Queensland, Australia. The US$991 million investment in the extension of the Kestrel Mine (nominalterms, 100 per cent basis, Rio Tinto share US$793 million) will allow Rio Tintoto capture more of the growing demand for export coal. Higher qualitymetallurgical coal is vital to boost steel production needed to satisfy fastgrowing demand driven by rapid urbanisation and rising incomes in Asian markets.The extension is subject to government approvals. Preston Chiaro, chief executive Energy, said the Kestrel Mine extension willextend the life of the mine and increase production to an average of 5.7 milliontonnes of coal a year until 2031. "This represents a further 20 year commitment to the Bowen Basin and is a strongvote of confidence in the Asian coal market. The extension will enable us totap into 112 million tonnes(1) of high quality hard and semi-hard coking coaland thermal coal for export." Mr Chiaro said the Kestrel Mine extension will incorporate sustainabledevelopment in its design to improve energy efficiency and reduce water usage.It is expected to create up to 250 jobs during construction and the currentoperating workforce of 320 will transition to the new extension. Rio Tinto's Australian-based managing director Strategy, Doug Ritchie, said, "This extension is one of a number of recent investment decisions aimed atfulfilling Rio Tinto's unrivalled strategy and growth plans. It comes hard onthe heels of the 26 November announcements to Rio Tinto's investors on the keyvalue drivers underpinning Rio Tinto's growth strategy." "Our primary objective is to create further value for our shareholders anddeliver very substantial returns in the future. We are entering into anunprecedented period of demand growth and Rio Tinto is well paced to meet thisdemand," he said. Investments approved in 2007 include the underground development of the DiavikDiamond Mine in Canada (US$563 million) bringing total investment in theunderground mine to US$787 million, the new Mesa A/Warramboo and Brockman 4mines in Western Australia (US$2.42 billion), the Rio Tinto Alcan acquisitioncompleted in November 2007 (US$38.1 billion), the Hope Downs iron ore expansionto 30 million tonnes per year (US$350 million), the Yarwun alumina refineryexpansion to 3.4 million tonnes per year (US$1.8 billion) and the Cape Lambertport expansion to 80 million tonnes per year (US$860 million). Notes to editors: Kestrel Mine Extension The Kestrel Mine, located 51 kilometres north-east of the central Queenslandtown of Emerald, currently produces about four million tonnes of high volatilecoking and thermal coal per year for the export market, using the longwallmining method. First longwall coal from the Kestrel Mine extension is expected in 2012, whenthe existing mine starts ramping down. The extension will require a newautomated run of mine stockpile system and a seven kilometre overland conveyorto the existing coal handling and preparation plant. A 375 metre wide longwall will replace the existing 250 metre wide longwall.This new longwall will achieve a substantially lower unit cost for mining andincreased productivity. A new workshop, warehouse, storage facilities andadministration building will be constructed, however many of the existingKestrel Mine facilities will continue to be used. For further information, please contact: Media Relations, London Media Relations, AustraliaChristina Mills Amanda BuckleyOffice: +44 (0) 20 7781 1154 Office: +61 (0) 3 9283 3627Mobile: +44 (0) 7825 275 605 Mobile: +61 (0) 419 801 349 Nick Cobban Alison SmithOffice: +44 (0) 20 7781 1138 Office: +61 (0) 7 3361 4223Mobile: +44 (0) 7920 041 003 Mobile: +61 (0) 438 787 038 Media Relations, USNancy IvesMobile: +1 619 540 3751 Investor Relations, London Investor Relations, AustraliaNigel Jones Dave SkinnerOffice: +44 (0) 20 7753 2401 Office: +61 (0) 3 9283 3628Mobile: +44 (0) 7917 227 365 Mobile: +61 (0) 408 335 309 Investor Relations, North AmericaDavid Ovington Jason CombesOffice: +44 (0) 20 7753 2326 Office: +1 (0) 801 685 4535Mobile: +44 (0) 7920 010 978 Mobile: +1 (0) 801 558 2645 Email: [email protected] Website: www.riotinto.comHigh resolution photographs available at: www.newscast.co.uk Forward-Looking Statements This announcement includes "forward-looking statements" within the meaning ofSection 27A of the Securities Act of 1933, as amended, and Section 21E of theSecurities Exchange Act of 1934, as amended. All statements other thanstatements of historical facts included in this announcement, including, withoutlimitation, those regarding Rio Tinto's financial position, business strategy,plans and objectives of management for future operations (including developmentplans and objectives relating to Rio Tinto's products, production forecasts andreserve and resource positions), are forward-looking statements. Suchforward-looking statements involve known and unknown risks, uncertainties andother factors which may cause the actual results, performance or achievements ofRio Tinto, or industry results, to be materially different from any futureresults, performance or achievements expressed or implied by suchforward-looking statements. Such forward-looking statements are based on numerous assumptions regarding RioTinto's present and future business strategies and the environment in which RioTinto will operate in the future. Among the important factors that could causeRio Tinto's actual results, performance or achievements to differ materiallyfrom those in the forward-looking statements include, among others, levels ofdemand and market prices, the ability to produce and transport productsprofitably, the impact of foreign currency exchange rates on market prices andoperating costs, operational problems, political uncertainty and economicconditions in relevant areas of the world, the actions of competitors,activities by governmental authorities such as changes in taxation or regulationand such other risk factors identified in Rio Tinto's most recent Annual Reporton Form 20-F filed with the United States Securities and Exchange Commission(the "SEC") or Form 6-Ks furnished to the SEC. Forward-looking statementsshould, therefore, be construed in light of such risk factors and undue relianceshould not be placed on forward-looking statements. These forward-lookingstatements speak only as of the date of this announcement. Rio Tinto expresslydisclaims any obligation or undertaking (except as required by applicable law,the City Code on Takeovers and Mergers (the "Takeover Code"), the UK ListingRules, the Disclosure and Transparency Rules of the Financial Services Authorityand the Listing Rules of the Australian Securities Exchange) to release publiclyany updates or revisions to any forward-looking statement contained herein toreflect any change in Rio Tinto's expectations with regard thereto or any changein events, conditions or circumstances on which any such statement is based. Nothing in this announcement should be interpreted to mean that future earningsper share of Rio Tinto plc or Rio Tinto Limited will necessarily match or exceedits historical published earnings per share. Subject to the requirements of the Takeover Code, none of Rio Tinto, any of itsofficers or any person named in this announcement with their consent or anyperson involved in the preparation of this announcement makes any representationor warranty (either express or implied) or gives any assurance that the impliedvalues, anticipated results, performance or achievements expressed or implied inforward-looking statements contained in this announcement will be achieved. -------------------------- (1) Please refer to previously announced ore reserves in the Rio Tinto 2006 Annual report and financial statements This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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