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London / New York
9 October 2012
©2012, Rio Tinto, All Rights Reserved
This presentation has been prepared by Rio Tinto plc and Rio Tinto Limited (“Rio Tinto”) and consisting of the slides for a presentation concerning Rio Tinto. By reviewing/attending this presentation you agree to be bound by the following conditions. Forward-Looking Statements This presentation includes forward-looking statements. All statements other than statements of historical facts included in this presentation, including, without limitation, those regarding Rio Tinto’s financial position, business strategy, plans and objectives of management for future operations (including development plans and objectives relating to Rio Tinto’s products, production forecasts and reserve and resource positions), are forward-looking statements. Such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Rio Tinto, or industry results, to be materially different from any future results, performance or achievements expressed or implied by such forwardlooking statements. Such forward-looking statements are based on numerous assumptions regarding Rio Tinto’s present and future business strategies and the environment in which Rio Tinto will operate in the future. Among the important factors that could cause Rio Tinto’s actual results, performance or achievements to differ materially from those in the forward-looking statements include, among others, levels of actual production during any period, levels of demand and market prices, the ability to produce and transport products profitably, the impact of foreign currency exchange rates on market prices and operating costs, operational problems, political uncertainty and economic conditions in relevant areas of the world, the actions of competitors, activities by governmental authorities such as changes in taxation or regulation and such other risk factors identified in Rio Tinto's most recent Annual Report on Form 20-F filed with the United States Securities and Exchange Commission (the "SEC") or Form 6-Ks furnished to the SEC. Forward-looking statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on forward-looking statements. These forward-looking statements speak only as of the date of this presentation. Except as required by applicable regulations or by law, Rio Tinto does not undertake any obligation to publicly update or revise any forward-looking statements, whether as a result of new information or future events. Nothing in this presentation should be interpreted to mean that future earnings per share of Rio Tinto plc or Rio Tinto Limited will necessarily match or exceed its historical published earnings per share.
©2012, Rio Tinto, All Rights Reserved
Introduction, outlook and strategy Capital allocation and performance Technology & Innovation Break Copper Summary Q&A Andrew Harding Tom Albanese Tom Albanese Guy Elliott Preston Chiaro
©2012, Rio Tinto, All Rights Reserved
Safety remains our core value
Injury frequency rates 2003 – Aug 2012
Per 200,000 hours worked
2,0 1,8 1,6 1,4 1,2 1,0 0,8 0,6 0,4 0,2 0,0 ’03 ’04 ’05 ’06 ’07 ’08 ’09 ’10 ’11 Aug12
All injury frequency rate Lost time injury frequency rate
Testing safety equipment
cost competitive assets • Disciplined and rigorous capital allocation and prioritisation • Allocating capital to projects with highest returns in the most attractive sectors . Rio Tinto. All Rights Reserved 6 Overview • Short term outlook is uncertain and volatile • Focus on balance sheet discipline and single A credit rating • Strong operational performance under tough conditions • Significant reductions in operating and evaluation costs and sustaining capex • Long term industry fundamentals remain attractive • Rio Tinto is well positioned • Strategy is unchanged – large. long life.©2012.
All Rights Reserved 7 Short term market uncertainty and volatility continue Synchronised slowdown underway Purchasing Managers Index – Manufacturing 65 60 55 50 45 40 35 30 25 Jan 08 Jan 09 US China Below 50 = Contraction Jan 10 Jan 11 Jan 12 Eurozone Japan Above 50 = Expansion • Continued deleveraging and austerity in OECD • Rate of growth in our markets in China is robust but is decelerating • Expect a sequential pick-up in Q4 with signs of improvement in property market • Impacts of stimulus extended out vs previous estimates: to be felt after Party Congress • Market to remain volatile Monthly new home sales growth in China % change year on year 100% 80% 60% 40% 20% 0% Jan-08 -20% -40% Source: CEIC / NBS Jan-09 Jan-10 Jan-11 Jan-12 .©2012. Rio Tinto.
All Rights Reserved 8 The long term demand outlook remains attractive Global commodity demand trajectories Index (2012 = 100) 200 • ~2 billion additional people to urbanise by 2030 • Global steel consumption expected to grow by 2 per cent per annum • China to remain key driver until mid2020s • China GDP per capita currently 19% of USA levels • India and South East Asian economies more than offset flat and then falling consumption in China • Consumption-led growth will benefit TiO2 and Aluminium 180 160 140 120 100 2012 2015 2018 2021 2024 2027 2030 Aluminium .©2012.Primary Hard coking coal Thermal coal Source: Rio Tinto analysis Copper . Rio Tinto.Primary Iron ore TiO2 .
Rio Tinto. All Rights Reserved 9 Continued urbanisation will drive Chinese steel demand growth Total steel demand over respective 20-year period (tonnes per capita) • Significant urbanisation to continue • China’s cumulative steel consumption per capita remains well behind developed world • This is despite substantial growth over the last decade • We estimate four per cent growth in steel demand this decade – but off a huge base • Crude steel production in China expected to peak towards 2030 US 1960-80 Germany 1970-90 Japan 1980-2000 South Korea 1990-2010 China 1990-2010 China 2010-30 0 5 10 15 20 Source: Rio Tinto analysis Note: Steel stock refers to the level of cumulative steel consumed within an economy over a 20-year period .©2012.
©2012. access to financing • Rising threat of resource nationalism • Recent high profile project deferrals Global iron ore fines cost curve 2012 (CIF China) Source: Macquarie . All Rights Reserved 10 The industry supply response is increasingly challenged Local Chinese iron ore supply is working harder 80% 60% 40% 20% 0% 02 04 06 08 10 Implied Domestic Fe % Domestic iron ore % market share Source: World Steel Association /GTIS/Rio Tinto analysis • ~100 million tonnes of mostly Chinese iron ore production is unprofitable today • Evidence that a large proportion of this already curtailed • Cost escalation and rising capital intensity will increase pressure on marginal project returns • Scarcity of highly skilled labour. Rio Tinto.
Rio Tinto. our fundamental strategy is consistent and unchanged • To maximise total shareholder return by sustainably finding. long term. cost competitive mines and assets • Maintain a strong balance sheet and single A credit rating • Allocate capital to the highest return opportunities • Investments driven by the attractiveness of commodity sectors.©2012. mining and processing natural resources • Invest in and operate large. and the quality of each opportunity . developing. All Rights Reserved 11 Within this context.
00 3.00 life extension 4.00 cost 0. developing and operating tier one assets expandability 9.00 Identify expansion options 0.00 expandability Improve.00 8. All Rights Reserved 12 Our strategy is focussed on finding.00 4.00 3.00 Tier 1 Implement operating enhancements Grow and protect Focus of new investment Optionality/ expandability/ 5. divest or close 2.00 Higher 1.00 2.00 Total cost position • Operating costs and sustaining capital • Capital intensity of growth .©2012.00 5.00 Lower cost 10.00 7.00 Lower 1.00 7.00 6.00 9.00 8.00 Higher 10.00 6. Rio Tinto.
00 0.00 5.00 3.00 Aluminium Energy Under review / recent divestment Cash cows 4.00 6.00 1.00 Leveraged plays Tier 1 Optionality 5.00 9. high and very high value (Rio Tinto share) .00 Cost position 6.00 1.00 Lower expandability Marginal assets 2.00 Lower cost 10.00 7.00 3.00 8.00 2.00 expandability 9.00 4.00 0.00 7. Rio Tinto.00 8. All Rights Reserved 13 We are taking constant steps to improve the quality of the portfolio Higher 10.00 Higher cost Iron ore Diamonds & Minerals Copper Bubble size represents medium.©2012.
©2012. All Rights Reserved 14 A clear and consistent strategy • The long term demand outlook remains attractive • Post GFC effects continue to drive short term market uncertainty and volatility • Increasingly delayed industry supply side response • Rio Tinto’s fundamental strategy remains unchanged • Allocating capital to those projects offering the highest returns • Targeting investment in the most attractive sectors • Constantly improving the portfolio in line with our strategy . Rio Tinto.
15 Guy Elliott Chief financial officer .
©2012. Rio Tinto. All Rights Reserved 16 Balancing value adding investment with returns to shareholders and a prudent balance sheet • Prudent balance sheet and single A credit rating in a volatile environment Cash from operations • Progressive dividend provides sustainable long term returns to shareholders Cash returns to shareholders Disciplined investment in highest value opportunities Prudent balance sheet management • Disciplined and rigorous approach to capital allocation • Investment programme focused on highest quality opportunities • Return surplus cash to shareholders $10 billion of non-sustaining investments in 2012 Single A credit rating Average borrowing maturity of 9 years Progressive dividend increased by 34% at FY 2011 $7 billion buy-back completed .
All Rights Reserved 17 Integrated strategy and planning process sets the key elements of our capital framework Capital boundaries Existing capital commitments. Rio Tinto.©2012. planned divestments Single A credit rating Progressive dividend Integrated strategy and planning process • • • • Set strategic framework Assess performance metrics Identify operating improvements Develop investment opportunities • Growth • Cash returns to shareholders • Assess and prioritise opportunities Capital plan Prioritised capital budget Single A credit rating Progressive dividends and other cash returns .
EBITDA margin Level of payback in first five years Risk Management Committee. low cost • Export markets Economics and Business Evaluation teams Set evaluation criteria Price assumptions Discount rate assumptions Project evaluation guidelines Board / Exco Set ranking criteria Value enhancement Where are the highest returns? When do we realise the return? What risks are involved? NPV IRR/ROI. long life.©2012. demand • Competitive advantage • Market structure • Performance Asset • Large. All Rights Reserved 18 Distinctive strategic investment themes and standard evaluation criteria drive our investment approach Board / Exco Develop investment themes Macro-economic Jurisdiction Sector “sieves” • Market size. Board . Rio Tinto.
All Rights Reserved 19 Our capital allocation process ensures we are making good decisions Develop investment themes Investment Committee Set evaluation criteria Opportunity development Project review and ranking Board Final decision Set ranking criteria .©2012. Rio Tinto.
Pilbara 283 and Pilbara 353 expansion .©2012. All Rights Reserved 20 Capital expenditure is being prioritised on the highest quality projects Approved1 capital expenditure US$ billions 18 16 14 12 10 8 6 4 2 0 2008 1 • Capex programme managed within limits of target single A credit rating • Rio Tinto’s proportionate share of 2012 capex is $13. Rio Tinto.7 billion • Three significant projects in three commodities to come on line within the next 18 months − Yarwun 2 currently ramping up − Oyu Tolgoi phase 1 − Pilbara 283 expansion • Level of sustaining capex under review with material reductions likely 2009 2010 2011 2012F 2013F 2014F • Flexibility around further major project approvals Approved capital expenditure includes probable capital likely to be approved for Pilbara sustaining mines.
low risk geography Divestments in 2012 and assets announced as under review Alcan Cable. Rio Tinto.©2012. not “large” or “long life” Insufficient market size in context of broader Rio Tinto portfolio Non core Non core . ZAC Diamonds business Pacific Aluminium Palabora Mining Non-core aluminium and coal assets. All Rights Reserved 21 Shaping the portfolio in line with our strategy • Capturing value from assets that no longer fit our strategy − >20 divestments worth a total of $12bn completed since 2008 − Various strategic review and divestment processes underway Significant acquisitions and divestments since 2011 Acquisitions Control of Turquoise Hill Resources Doubling stake in Richards Bay Minerals Acquisition of Riversdale Acquisition of Hathor Exploration Oyu Tolgoi: tier one copper resource with average production of 425ktpa copper and 460kozpa gold High quality. 1Mtpa TiO2 feedstock and >20 year mine life Highly prospective. tier one coking coal resource with first production mid-2012 and objective of 25Mtpa high quality coking coal by 2020 Proven high grade uranium deposit in highly prospective. low cost resource with production capacity of c. Specialty Aluminas.
All Rights Reserved 22 Prudent balance sheet management Proforma gross debt maturity profile at 30 June 20121 (US$bn) 5.0 1.5 5.5 billion of bonds issued in 2012 with a weighted average maturity of around 12 years and coupon of 3.5 1.5 billion bond maturity September 2012 .0 0.7 billion of bonds falling due over next 18 months • Approximately two thirds of gross debt at fixed interest rates 1 30 June 2012 maturity profile adjusted for $3 billion bond issue August 2012 and $0. Rio Tinto.0 4.5 3.0 3.0 • Aim to maintain a single A credit rating • Long term and smooth debt maturity profile • Weighted average maturity of over nine years • $5.5 4.5 2.6% • $1.©2012.5 0.0 2.
All Rights Reserved 23 Strong operational performance. Rio Tinto. Freeport. Anglo American.©2012. Vale. including trading activities. Xstrata. Alcoa Australian capital cost inflation (2000 = 100) 190 Rio Tinto Peer group range 180 170 160 150 140 130 120 110 Australian CPI Typical Mine + Mineral Processing Facility Australia (IPA) Aluminium Iron Ore Coal 100 90 Source: IPA . further significant cost reductions planned EBITDA margin by product 2012 first six calendar months 80% 70% 60% 50% 40% 30% 20% 10% 0% Copper -10% Aluminium based on Rio Tinto Alcan operations only. Peer group comprises BHP Billiton.
Rio Tinto. All Rights Reserved 24 A disciplined approach to capital allocation • Prudent balance sheet and single A credit rating in a volatile environment • Clearly defined approach to capital allocation • Investment programme focused on the highest quality opportunities • Progressive dividend provides sustainable long term returns to shareholders • Return surplus cash to shareholders • Shaping the portfolio in line with our strategy • Strong operational performance with further significant cost reductions planned .©2012.
Technology and Innovation .25 Preston Chiaro Group Executive.
including: Operational Improvement Optimising our operating assets Major capital project delivery Helping to deliver on time and on budget projects Innovation Delivering value through the design and implementation of step change innovations Technical Assurance Understanding and managing technical risk in major capital allocation decisions . Rio Tinto. and challenges Rio Tinto Product Groups and functions to deliver industry leading performance in strategically critical areas.©2012. All Rights Reserved 26 Technology and Innovation makes Rio Tinto operations best in sector T&I partners with. supports.
Rio Tinto. All Rights Reserved 27 Optimising our operating assets to achieve industry leading performance • World leading centralised model of technical expertise • Distinctive capabilities and unique processes in critical disciplines • Strategic Production Planning group identifies optimal resource development • Identify and implement productivity improvements • Sharing leading practice in operational performance • Developing capabilities in core technical skills .©2012.
reliability improvement tools .©2012. All Rights Reserved 28 Standardised global asset management processes drive down costs Pre-tax cash flow savings from better Asset Management (US$m) 1600 1400 1200 1000 800 600 400 200 0 2008 2009 2010 2011 YTD 2012 • Improve the performance of physical assets • Global metrics for standardised reporting and performance reveals best practice • Centralised model efficiently shares leading practice • Training programmes to build capability • Development and ownership of standard technical systems: mobile asset health. Rio Tinto.
©2012. Rio Tinto. Trucks (RHS) . All Rights Reserved 29 Unique processes and systems deliver value Haul truck availability (%) 88% 1000 950 87% 900 86% 850 800 85% 750 84% 700 650 83% 600 82% 2006 550 2007 2008 2009 2010 2011 2012 HTA (LHS) Decline in number of trucks in 2010 due to sale of Rio Tinto Energy America assets • Increased haul truck availability has resulted in 18 trucks not being required • T&I has supported improvement through standardised metrics • Advanced modelling identifies benefits for critical assets • Consistent methodology applied across the group No.
Rio Tinto..how often does an asset breakdown • Across the group Mean Time Between Failures has increased by 50% • Rio Tinto average payload as a percentage of maximum payload increased from 99. from levels below 97% prior to implementing global measurement • Increased payload has resulted in at least 6 trucks not being required Average Payload Average Payload (% of Target) 101% 100% 99% 98% 97% 2008 2009 2010 2011 2012 .3% in 2008 to 100% in 2011. All Rights Reserved 30 Improved performance of critical assets reduces operating costs Mean time between failures Haul Truck MTBF (Utilised Hours) 70 65 60 55 50 45 40 35 2006 2007 2008 2009 2010 2011 2012 • Mean Time Between Failures (MTBF) is an indicator of reliability.©2012..
©2012. Rio Tinto. All Rights Reserved 31 Centralised major projects capabilities shares best practice Achieve repeatable success on major projects: Central capability supports Product Groups • Consistent methodologies lowers project costs • Regional and commodity based delivery hubs delivers expertise where it is needed • Talent pipeline centrally managed Challenges • Rising capital intensity across the globe • Difficult to attract and retain skilled people • Loss of experience when demobilising a group • once a project finishes .
Rio Tinto.©2012. faster. better • Tunnel boring system trials to commence at Northparkes during H2 2012 • Optimise resource productivity • Expansion of driverless truck fleet to 150 • Operations Centre • Smart drilling and blasting • Autonomous trains (AutoHaul™) • Recover more from mineral deposits • NuWave™ copper sorting pilot plant being commissioned at KUC Innovation networks created through long term strategic alliances Protection of Intellectual Property is key to sustaining competitive advantage . All Rights Reserved 32 We drive step change innovation Our Mine of the Future™ is shaped by four significant value levers Find Develop Mine Recover • Find future tier one ore bodies • VK1 in initial flight trials • Complex testing programme under way • Develop future block cave mines safer.
Rio Tinto. All Rights Reserved 33 Rio Tinto innovation network model Technology partnerships 1 Komatsu 2 Aker Wirth 3 Atlas Copco 4 e2v 5 Tomra 6 University of Nottingham 7 University of Western Australia 8 Herrenknecht 9 Río de Cobre 8 6 4&6 5 2&8 3 1 2 5 1 Centres of Excellence 1 2 3 4 5 Centre for Underground Mine Construction Centre for Advanced Mineral Recovery Centre for Materials and Sensing Centre for Advanced Mineral Sorting Centre for Mine Automation 1 Rio Tinto Centres 1 2 3 4 5 6 Rio Tinto Innovation Centre Rio Tinto Iron Ore Operations Centre Rio Tinto Copper Excellence Centre Trial 9 Rio Tinto Copper Block Caving Knowledge Centre Rio Tinto Iron and Titanium Technology Centre Rio Tinto Minerals Asia Technology Centre 7 3 3 2 4 7 4 5 7 Rio Tinto Research Park 8 Rio Tinto Minerals Technology Centre .©2012.
All Rights Reserved 34 Systematic approach to innovation Proof of Concept Idea Pilot Demo Deploy Support • Structured control and governance • Data management and security • Rigorous investment proposals • Freedom-to-operate • Patent families and walls • Trade secrets. individual contracts Innovation without intellectual property protection is philanthropy .©2012. copyright and trademarks. Rio Tinto.
©2012. Rio Tinto. All Rights Reserved 35 T&I is central to managing technical risk An integral part of our risk management and capital allocation Activities and groups involved include: • Technical guidance and due diligence of investment opportunities • Support of resource and reserve governance • Governance and oversight on areas of strategic risk • Global leaders on energy and water management issues .
and challenges Rio Tinto Product Groups and functions to deliver industry leading performance in strategically critical areas.©2012. supports. Rio Tinto. All Rights Reserved 36 Summary T&I partners with. including: Operational Improvement Optimising our operating assets Major capital project delivery Helping to deliver on time and on budget projects Innovation Delivering value through the design and implementation of step change innovations Technical Assurance Understanding and managing technical risk in major capital allocation decisions .
Oyu Tolgoi. Mongolia Investor seminar London / New York 9 October 2012 .
Copper .Oyu Tolgoi. Mongolia Andrew Harding Chief executive.
000 40. Rio Tinto.000 20.000 12.000 40.000 50.000 16.000 30.000 100 2.000 10. All Rights Reserved 39 Long-term demand drivers remain positive Electrification of large emerging markets will support demand 18.000 300 8.000 6.000 50.000 GDP/Capita 2005 US$ USA China Japan South Korea Germany India *2009 except China which is 2011 0 0 India 10.000 30.000 500 14.000 China 200 Mexico Emerging markets High income densely populated Hong Kong 400 Middle-income industrialising USA Per capita electricity consumption (GWh/capita) 1970-2010 While sectors such as automotive have significant growth potential Passenger vehicle ownership/1000 people* 600 High income mature markets Germany GDP/Capita 2005 US$ .000 4.000 0 0 10.000 20.©2012.
5 Mt -0.7 Mt Source: Wood Mackenzie Q3 2012 .11% -1.09% -0. Rio Tinto.01% -0.©2012.05% 2002-2006 2007-2011 2012-2016 10 5 0 2008 2013 Base production Probable projects Primary demand 2018 2023 Highly probable projects Possible projects -2. All Rights Reserved 40 Declining grades and mine closures impact supply 1.6Mt Cu as a result of grade declines from 2012-2016 1997-2001 -0.6 Mt -0.8Mt production loss between 2012-2016 due to closures 2012 2013 2014 2015 2016 Production loss due to closures kt Cu Continued project development is necessary to meet medium term demand Copper mine supply-demand outlook (Mt) 40 35 322 144 319 473 506 30 25 20 15 The industry requires 1.5 Mt -1.
©2012. Rio Tinto. All Rights Reserved 41 Higher grades improve unit cost and business performance compared to 2012 Production profile – Rio Tinto share 2012–2015 production forecast Kt Cu/ Koz Au 800 700 600 500 400 300 200 100 0 2011 2012 Copper Production data excludes Palabora 2013 Gold 2014 2015 • Over 13% CAGR in copper to 2015 • Production impacted by unfavourable grades and smelter shutdown in 2012 • Production volume and grade improvement in 2013 • Investment focused on key assets and retaining development optionality on high quality assets • Focus on business improvement to drive productivity and unit cost performance − Delivery of 15% reduction in overhead costs − EBITDA margins remain strong +13% CAGR .
36 g/t gold • Additional underground and open pit resources of 3.1bt at 0.84% copper and 0.9% copper and 0.©2012. All Rights Reserved 42 Oyu Tolgoi.49% copper and 0. Rio Tinto.33 g/t gold • Exemplary environmental standards • Building a sustainable economic footprint • Foreign direct investment in Mongolia important to support continued development .42 g/t gold with open pit reserves of 955mt at 0. a world class copper business • Tier one asset with first quartile net unit cash costs • Average annual production of 425kt of copper and 460koz of gold • Underground reserves of 437mt at 1.
©2012. All Rights Reserved 43 Countdown to first production at Oyu Tolgoi • Project over 97% complete Event First ore through SAG mill First concentrate production Commercial production (30 days at 70%) Timeline from Power 6 weeks 3 months 6-8 months • Sales contracts for 75% of concentrate in place • Physical construction of all power transmission infrastructure complete − Commercial negotiations continue • Transitioning to 90% Mongolian operations workforce . Rio Tinto.
©2012.000t/pd • Underground ore grade to increase by 4x compared with open pit . Rio Tinto. All Rights Reserved 44 The next phase will take Oyu Tolgoi underground • DIDOP feasibility study H1 2013 • Optimising production schedule through use of Strategic Production Planning • First production planned for 2016 and completed by 2018 • Operating rates up to 85.
185koz of gold and 13. large.79% CuEq − Unit cost per tonne of material moved in line with 2011 − Production 180kt of copper. silver and molybdenum by-products • US$660m approved for additional HME and facilities to extend mine life to 2029 − 515mt of ore at 0. All Rights Reserved 45 Kennecott 100% owned. low cost • Unit costs reduced by gold. Rio Tinto.8kt molybdenum from 2019 • Moly Autoclave commissioning H1 2013 • Kennecott operations consistently a leading industry benchmark • Well positioned to test new technologies and innovations – TBS trial and Copper NuWaveTM ore sorting technology . long life.©2012.
Rio Tinto.©2012. All Rights Reserved 46 Alternatives for Kennecott underground development are being considered Kennecott resource development • US$165m approved for North Rim Skarn pre-feasibility studies to 2014 • Continued focus on evaluating underground options Conceptual underground sequencing North Rim Skarn East Cave Highland Boy Deep Moly1 South West Caves Fortuna Skarn Cornerstone South pushback – extend mine life Strategic enabler Block caves and other pushbacks Extend life of operations Safely access higher grade deposits North Rim Skarn Underground skills and experience Platform for further development LOM 2018 1) Source: Rio Tinto Moly Exploration Target Fact Sheet 2029 2050+ .
Rio Tinto. All Rights Reserved 47 Unlocking value through phased development at La Granja • +40 year mine life with phased approach to development • Starter mine in pre-feasibility with first production in 2017 − Significant capital investment delayed until after first production − Application of leaching technology to maximise recovery − Open pit with low technical risk − 80kt heap leach trial underway at Kennecott − Social project commenced • Orebody knowledge continuing to positively evolve − Part of broader porphyry district − Significant upside potential .©2012.
47% copper with significant molybdenum • Land exchange bill approved in US House of Representatives • Progressed shaft 9 and 10 development and ongoing of resource and geotechnical conditions • Pre-feasibility studies being extended to allow a complete analysis of mining and processing options . Rio Tinto.©2012. All Rights Reserved 48 Resolution a major future underground operation • Drilling continues to confirm a world class orebody − 1.
All Rights Reserved 49 Investment for organic growth in our operations Escondida • Improved recovery through advancing leaching technology. productivity improvements and debottlenecking − Organic Growth 1 Project − Oxide Leach Area Project − Escondida Ore access Grasberg • Investment in the transition to a major underground operation with planned tonnage at 240ktpd mill throughput − Grasberg Block Cave − Deep Mill Level Zone (DMLZ) • 40% of production in 2022 . Rio Tinto.©2012.
All Rights Reserved 50 Technology and capability key to delivering our strategy Copper NuWave™ (ore sorting technology) • Plant constructed and pilot underway • Increased concentrator throughput • Ability to recover copper from waste streams Tunnel Boring Machine • Commissioning at NPM • Potential to reduce Underground construction by ~40% • 50% more effective than drill and blast methods Rio Tinto Block Cave Knowledge Centre • NPM centre opened August 2012 • Partnership with University of NSW • State of the art learning technology Automated Underground loaders • Leading edge technology deployed at Northparkes • 40% of extraction level currently automated • Productivity improvements and significant safety benefits . Rio Tinto.©2012.
©2012. All Rights Reserved 51 Focused profitable growth and operational excellence • Confidence in industry fundamentals • Best copper assets in the business • High quality and diverse portfolio • Margin delivery through cost discipline and operational performance • Nearing first production of flag ship project Oyu Tolgoi • Phased development of greenfield projects ensuring optionality and preserving value . Rio Tinto.
52 Tom Albanese Chief executive .
cost competitive mines and assets • Maintain a strong balance sheet and single A credit rating • Investments driven by the attractiveness of commodity sectors. All Rights Reserved Our fundamental strategy is consistent and unchanged • To maximise total shareholder return by sustainably finding.©2012. Rio Tinto. developing. Rio Tinto. and the quality of each opportunity 53 ©2012. mining and processing natural resources • Invest in and operate large. long term. All rights reserved .
All Rights Reserved 54 Executing our strategy • Long term industry fundamentals remain attractive • Rio Tinto’s strategy remains unchanged – large. low cost assets • Disciplined and rigorous capital allocation and prioritisation • Strong operational performance with further significant cost reductions planned • Technology and innovation delivers substantial value • Focused on maximising total shareholder return . long life.©2012. Rio Tinto.
Mongolia Investor seminar London / New York 9 October 2012 .Oyu Tolgoi.
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