Mumbai:
Anglo-Australian mining giant Rio Tinto will invest $1.8
billion for expanding capacity of its Yarwun alumina refinery
in Gladstone, Queensland by another 2 million tonnes.
The expansion would more than double annual production
at the smelter from the current 1.4 million tonnes to
3.4 million tonnes by 2011.
Rio Tinto''s long life resource at Weipa in northern Queensland
will supply bauxite to the refinery. The Yarwun expansion
will have the benefit of substantial scale efficiencies
gained from the construction of the first stage of the
refinery.
"The expansion of the Yarwun Alumina Refinery is
one of the most significant investments made by Rio Tinto
in recent years. The attractive fundamentals of the aluminium
industry, combined with Yarwun''s well located, low cost
position and our excellent bauxite resource at Weipa,
reinforce the deep underlying strength of the group''s
organic growth pipeline," said Tom Albanese, chief
executive of Rio Tinto.
"This project firmly positions Rio Tinto in the first
quartile of the alumina cost curve and creates the future
supply for the growth in the world traded alumina market.
The expansion further strengthens our aluminium infrastructure
in Gladstone and Queensland . We have received a high
level of encouragement from federal, state and local governments
as well as community support," said Oscar Groeneveld,
chief executive of Rio Tinto Aluminium.
"One important feature of the project is the inclusion
of a gas-fired cogeneration facility. Gas will become
the refinery''s primary fuel source, demonstrating our
ongoing commitment to reducing greenhouse gas emissions
and improving energy efficiency," he said.
Rio Tinto said work on its expansion at the alumina refinery
will start in the third quarter of 2007 and is expected
to take about three years to complete. First shipments
from expanded capacity are expected in the second half
of 2010, it said.
Rio
had previously placed its expansion plans at Yarwun on
hold, citing cost pressures, and the decision to go ahead
with the project may damp persistent speculation the miner
is mulling a bid for Canadian aluminum giant Alcan Inc.,
reports quoting analysts said.
Rio Tinto and rival BHP Billiton Ltd. have both been at
the center of speculation over a possible buyout of Alcan
although the to have so far preferred to focus on their
own expansion projects.
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