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    RIO   GB0007188757

RIO TINTO PLC

(RIO)
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Real-time Estimate Cboe Europe  -  11:16 2022-11-30 am EST
5643.00 GBX   +1.44%
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Rio Tinto, Baowu Agree Joint Venture to Develop $2 Billion Australian Iron-Ore Project -- Update

09/13/2022 | 07:01pm EST

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

09-13-22 2101ET

Stocks mentioned in the article
ChangeLast1st jan.
RIO TINTO PLC 1.26% 5634 Delayed Quote.13.72%
SILVER 1.91% 21.595 Delayed Quote.-10.16%
All news about RIO TINTO PLC
08:07aRIO TINTO : Barclays maintains a Sell rating
MD
06:19aEuropean Midday Briefing: Stocks Firmer as Eurozone Inflation D..
DJ
06:04aEuropean shares rise on hopes of easing China COVID curbs
RE
05:36aRIO TINTO : Gets a Neutral rating from RBC
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04:50aRio Tinto Sets 2023 Target for Pilbara Iron Ore Shipments; Plans Further Investment in ..
MT
03:43aEuropean shares rise with the focus on data, Fed's Powell
RE
02:48aRio Tinto Unveils FY23 Production Guidance; Maintains 2022 Targets
MT
02:20aRio Tinto to Invest $3 Billion Annually to Meet Demand Amid Energy Transition Plans
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Financials (USD)
Sales 2022 54 031 M - -
Net income 2022 14 215 M - -
Net Debt 2022 1 049 M - -
P/E ratio 2022 7,70x
Yield 2022 8,11%
Capitalization 110 B 110 B -
EV / Sales 2022 2,06x
EV / Sales 2023 2,28x
Nbr of Employees 49 000
Free-Float 65,5%
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Technical analysis trends RIO TINTO PLC
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Mean consensus HOLD
Number of Analysts 23
Last Close Price 66,60 $
Average target price 63,66 $
Spread / Average Target -4,42%
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Managers and Directors
Jakob Stausholm Chief Executive Officer & Executive Director
Peter Lloyd Cunningham Chief Financial Officer & Executive Director
Dominic S. Barton Chairman
Mark Davies Chief Technical Officer
Arnaud Soirat Chief Operating Officer
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