Rio’s operations review reflects commodities recovery

Chief executive Tom Albanese said, “We are seeing recovery across most of our key commodities, although we continue to be cautious on the state of the global economy going into 2010 as stimulus packages start to wind down.
“We made good progress in divestments with $1.85 billion of sales completed in the fourth quarter and have now agreed sales of $10.3 billion since we began the divestment programme in 2008.”
Both global and Pilbara iron ore production also set new records in 2009, with production up 49 per cent compared with the fourth quarter of 2008. Global iron ore sales set a new quarterly record of 61 million tonnes (100 per cent basis). Rio Tinto’s global iron ore production in 2009 exceeded 217 million tonnes (172 million tonnes on an attributable basis), a 13 per cent increase on 2008, and also a new record.
Pilbara iron ore production was 56 million tonnes (45 million tonnes on an attributable basis), up 54 per cent on the fourth quarter of 2008. The Pilbara system consistently operated above its nameplate capacity in order to supply continuing strong growth in demand.
Mined copper production was up 36 per cent on the fourth quarter of 2008 with higher production at all operations, notably at Escondida and Grasberg.
Refined copper production was up 15 per cent on the fourth quarter of 2008 following higher concentrate grades and a further improvement in performance at Kennecott Utah Copper.
Mined gold production exceeded 1.1 million ounces in 2009, 141 per cent above 2008, attributable to higher grades at Kennecott Utah Copper and Grasberg.
Production cutbacks were maintained in the Aluminium group in response to market conditions. Bauxite production was down one per cent, alumina down two per cent and aluminium down three per cent, compared with the fourth quarter of 2008. At the end of 2009 Rio Tinto Alcan’s annual run rate was nine per cent lower than at the start of the year.
Australian thermal coal production was up five per cent on the fourth quarter of 2008. Australian hard coking coal production was down two per cent on the same period.
Uranium production was down 20 per cent on the fourth quarter of 2008 due to lower grades at ERA. 2009 full year uranium production was consistent with the prior year.
On December 5th, Rio Tinto and BHP Billiton announced that they had signed binding agreements on the proposed iron ore production joint venture that cover all aspects of how the joint venture will operate and be governed. Rio Tinto and BHP Billiton anticipate completion of the production joint venture in the second half of calendar year 2010.