AAP
Rio Tinto to double thermal coal by 2015
Friday July 25, 08:44 PM
Rio Tinto, the focus of a $US142 billion ($A148 billion) proposed takeover from rival BHP Billiton, has unveiled ambitious plans to double its Australian thermal coal output and significantly lift uranium production.
The company has set itself a target of lifting output for thermal coal - used as fuel for power stations - to 49.2 million tonnes a year by 2015, subject to infrastructure expansions in Queensland and New South Wales.
Rio Tinto has also flagged plans to lift the production of steel-making ingredient coking coal to 15.2 million tonnes by 2015.
"Coal is experiencing significant global
growth, there is a favourable price outlook for both thermal and coking coal," Rio Tinto coal managing director Hubie van Dalsen told a briefing in Sydney.
Mining companies are attempting to rapidly expand production amid seven years of commodity price gains, underpinned by demand from China and other developing nations.
Shares in Rio Tinto dipped $1.40, or 1.22 per cent to close at $113.80, while BHP Billiton dropped 63 cents, or 1.68 per cent to $36.92.
Rio Tinto, the world's second largest uranium producer, also flagged plans to almost double output from the Rossing uranium mine in Namibia to 8.4 million pounds a year by 2012.
Rio Tinto energy chief executive Preston Chiaro told the briefing that power demand globally would grow by 3.7 per cent a year to 2020, with China accounting for 44 per cent of that demand growth.
Mr Chiaro said that Rio Tinto was assessing opportunities to expand the company's uranium business, which included the Rossing operation and a 68.4 per stake in Energy Resources of Australia
Ltd (ERA).
He said Rio Tinto had entered into discussions with Kazakhstan's national uranium company Kazatomprom about potential opportunities in the country, and was assessing an opportunity in the Middle East.
Mr Chiaro said also that Rio Tinto was aiming to have the $US3.5 billion ($A3.65 billion) Potasio Rio Colorado potash operation in Argentina producing at a rate of 4.3 million tonnes per year by 2012.
The price of potash, which is a potassium carbonate used in fertilisers, has spiked above $US1000 a tonne amid an increase in demand for food and biofuels.
Potential for further potash growth existed at the Regina operation in Canada where test drilling is underway.
Rio Tinto also flagged a 60 per cent increase in titanium iron ore production by 2015.
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