Rio Tinto and Chinalco to form JV for mineral exploration in China
03 Dec 2010
Rio Tinto, the world's third-largest mining company and Chinese state-owned aluminum giant Chinalco, today signed a non- binding memorandum of understanding to establish a joint venture to explore and develop mineral deposits in China.
Chinalco, which is also Rio Tinto's largest shareholder with a 9-per cent stake, will hold a 51-per cent interest in the JV, to be established next year, with Rio Tinto holding the remaining 49 per cent.
Rio Tinto will appoint the chief executive of the exploration JV, with the chairman of the five-member board nominated by Chinalco.
The JV plans to initially explore between three and five targets in coking coal and copper deposits in China.
''The JV will explore mainland China for world-class mineral deposits and is expected to come into operation in the first half of next year. It is intended that between three and five large area exploration projects will be selected for initial focus by the JV, with the potential for additional regions to be added at a later date, Rio Tinto said in a statement.
"This exploration JV is the latest chapter in the rich history of partnerships between Rio Tinto and China. The combination of skills provided by Rio Tinto and Chinalco offers great potential to unlock value for mutual benefit," said Rio Tinto chief executive Tom Albanese.
"Against the backdrop of the globalisation of resources supporting the globalisation of the world economy, for both sides to build on our respective strengths and establish an exploration JV is a win-win measure that will deepen our cooperation and meet the challenges of the market,'' said Chinalco president Xiong Weiping.
The present deal comes after both companies had formed a JV to develop the $12-billion Simandou iron ore project in Guinea in March 2010. (See: Chinalco, RioTinto in $12-billion Simandou iron ore project talks)