Rio Tinto has approved the extension of its Kennecott copper mine until 2032. This would add 1mt of refined copper between 2026 and 2032. Total capital expenditure is US$1.5bn over the next six years.

Morgan Stanley envisages minimal changes to estimates as a result of the announcement. The company has also curtailed operations at Richard Bay in South Africa, citing escalation of criminal activity.

As a result the smelter is running at lower capacity. Rio Tinto now expects 2019 production of titanium dioxide to hit the lower end of guidance. No timeline or production impact was provided for 2020.

Equal-weight rating. Industry view is In-Line. Target is $95.

Sector: Materials.

Target price is $95.00.Current Price is $95.03. Difference: ($0.03) - (brackets indicate current price is over target). If RIO meets the Morgan Stanley target it will return approximately 0% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2019 Acquisdata Pty Ltd., source FN Arena