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Rio Tinto Restarts Iron Ore Expansion Program in Canada
05/07/2010 - Rio Tinto has recommenced its expansion program in its Iron Ore Co. of Canada operations, with new investment of US$401 million. It was initially approved in March 2008 but suspended later that year due to the global financial crisis.
Rio Tinto has recommenced its expansion program in its Iron Ore Co. of Canada (IOC) operations. The Board of IOC has approved new investment of US$401 million (Rio Tinto share US$235 million) to increase its annual concentrate capacity by 4 million tonnes to 22 million tonnes by 2012.
The investment is the first stage of a three-stage expansion program at IOC that could increase concentrate annual capacity to 26 million tonnes. It was initially approved in March 2008 but suspended later that year due to the global financial crisis.
Sam Walsh, IOC Chairman and Rio Tinto Chief Executive, Iron Ore, said the decision highlights the company’s confidence in growing demand for iron ore, the attractiveness of investing in Canada, and the quality and potential of IOC's assets.
"Some uncertainty and potential volatility remain about global economic recovery, but global iron ore and steel markets have rebounded strongly and demand growth looks set to continue,” he said. “This expansion program is a significant step towards realizing the full potential of our IOC operations. IOC's assets and high-quality product position us strongly for future iron ore demand growth in North America, Europe, and Asia.”
The revised total project cost for the first stage expansion, including costs spent prior to suspension, is US$497 million (Rio Tinto share US$292 million), a US$22 million increase on the original estimate.
Iron Ore Co. of Canada (IOC) is the largest manufacturer of iron ore pellets in Canada, with its customer base covering North American, European, and Asian steel producers. The company operates a mine, concentrator, and a pelletizing plant in Labrador City, Newfoundland and Labrador, as well as port facilities located in Sept-Îles (Quebec). It also operates a 418-km railroad that links the mine to the port. IOC has approximately 1900 employees and its major shareholder (equity 58.7%) and operator is Rio Tinto, which has activities in more than 40 countries throughout the world.
Rio Tinto is a leading international mining group headquartered in the U.K., combining Rio Tinto plc, a London and NYSE listed company, and Rio Tinto Ltd., which is listed on the Australian Securities Exchange. Its business is finding, mining, and processing mineral resources. Major products are aluminum, 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 North America with significant businesses in South America, Asia, Europe, and southern Africa.
