Rio Tinto, Baowu Agree Joint Venture to Develop $2 Billion Australian Iron-Ore Project -- Update
13 Septiembre 2022 - 08:16PM
Noticias Dow Jones
By Rhiannon Hoyle
Rio Tinto PLC said it has agreed to form a joint venture with
China Baowu Steel Group Corp. Ltd. to develop the $2-billion
Western Range iron-ore project in Australia's Pilbara region.
The Anglo-Australian mining company and China's state-owned
Baowu, its biggest iron-ore customer, also intend to sign a sales
agreement for Baowu to buy almost half of the mine's production
over a roughly 13-year period. Rio Tinto wants to develop the
project to help sustain production of the company's core Pilbara
Blend iron-ore product from its existing Paraburdoo mining hub.
Rio Tinto said it will own 54%, and Baowu 46%, of the venture
that will develop the 25-million-metric-ton a year Western Range
project. Rio Tinto's share of the cost would be $1.3 billion, which
is already included in its capital expenditure guidance for the
next two years, the company said.
"The development of Western Range represents the commencement of
the next significant phase of investment in our iron ore business,
helping underpin future production of the Pilbara Blend, the market
benchmark," said Rio Tinto iron ore chief Simon Trott. The miner
recently opened Gudai-Darri, its 17th iron-ore mine in the Pilbara,
which it started building in 2019.
The planned Western Range sales agreement would include up to
126.5 million metric tons of iron ore--Baowu's 46% share in the
anticipated 275 million tons to be produced from Western Range--to
be sold at market prices, Rio Tinto said.
The plans need to be approved by Rio Tinto shareholders, Chinese
Government regulatory agencies, and state and federal governments
in Australia.
Rio Tinto and Baowu have partnered on iron-ore mining in
Australia's Pilbara since 2002, when they signed a joint venture to
develop the Eastern Range deposits. The companies are also working
together to find ways to cut carbon emissions from steelmaking
processes.
"We hope that the two parties will deepen the mutually
beneficial and win-win partnership, continue to carry forward the
spirit of sincere cooperation and further expand cooperation in
more fields and aspects on the basis of working together to operate
the project well," said Baowu Resources Chairman Shi Bing.
Construction of the Western Range project is slated to start
early next year, and the site should be producing iron ore in 2025,
said Rio Tinto.
Write to Rhiannon Hoyle at rhiannon.hoyle@wsj.com
(END) Dow Jones Newswires
September 13, 2022 21:01 ET (01:01 GMT)
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