Rio Tinto (NYSE:RIO) said on Wednesday that it is recovering from harsh Australian weather during the first quarter and expects to benefit from improving prices, as it continues to accelerate development of coal assets in the region.
Coal, iron ore, uranium and alumina operations are all rebounding, Rio Tinto CEO Tom Albanese said.
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Hurt by three tropical cyclones and massive flooding, the Melbourne, Australian-based mineral resources miner said global iron ore production was down 3% from the first-quarter of 2010 and down 16% sequentially from the fourth-quarter.
Following completion of the first de-bottlenecking project at the Dampier port however, capacity of Pilbara iron ore operations increased by the end of the first quarter.
Mined copper slipped 14% during the period, which reflects lower grades at Escondida and Grasberg, while Alumina production fell 4%, hurt by heavy rains in Queensland. Bauxite and aluminum production were mostly flat year-over-year.
Monsoons led the company to declare force majeure at its four Queensland mines at the end of 2010, which still remains affective at its mine in Hail Creek. Australian hard coking coal production was down 12% year-over-year and a whopping 29% sequentially.
In its effort to rebound though, Rio Tinto approved a $933 million investment to extend the life of the Marandoo iron ore wine by 16 years to 2030. It also announced in February a $5 billion capital management program and had seen 15.6 million of its shares, a total of $1.1 billion worth, by the end of the quarter.
On Monday, Rio Tinto assumed control of Riversdale Mining Limited, helping in gain control of significant tier one coking coal projects.