Global mining giant Anglo American Plc said yesterday that the company will write down approximately $4 billion related to delays at its large iron ore venture Minas-Rio in Brazil.

The move follows another major write off amounting $14 billion a fortnight ago by the world's third-largest miner Rio Tinto Plc on account of its Mozambique coal mine acquisition and Alcan aluminium business, following which the company's long-serving chief executive Tom Albanese had to quit. (See: Rio Tinto CEO quits after $14-bn write-down)

Anglo American acquired Minas-Rio in 2007-08 from Brazilian billionaire Eike Batista for $5.2 billion when iron ore prices were at their peak. However, the project became saddled with delays and cost blowouts that forced the company's chief executive Cynthia Carroll to put in her papers. (See: Anglo American CEO Cynthia Carroll resigns under shareholders pressure).

The project involves construction of a state-of-the-art open-cast iron ore mine and beneficiation plant in the states of Minas Gerais and Rio De Janeiro with an initial capacity of 26.5 million tonnes per annum of iron ore pellets, a 525-km pipeline for transportation of slurry from the mine to the port and loading facilities at Port of Acu on the eastern coast of the country.

The company has faced major problems related to acquisition of numerous licences and accession of land for its slurry pipeline.

Anglo American's outgoing CEO Carroll, who is due to leave in April this year,  said: ''We are clearly disappointed that the diversity of challenges that our Minas-Rio project has faced has contributed to a significant increase in capital expenditure, leading to the impairment we have recorded.''

''Despite the difficulties, we continue to be confident of the medium and long term attractiveness and strategic positioning of Minas-Rio and we remain committed to the project,'' Carroll added.

According to latest estimates, capital expenditure for the Minas-Rio project is expected to increase to $8.8 billion. Based on this, the company will record an impairment charge of $4 billion in its books for the period ending in December 2012.

Some analysts are of the opinion that the write-down is at the lower end of expectations.

Anglo American has spent around $3.8 billion on Minas-Rio development so far excluding the acquisition costs, with another $5 billion planned for its completion. It is over 3 times the original capital expenditure forecast of $2.6 billion five years ago.

Nevertheless, the miner is hopeful of loading its first iron ore cargo by the end of 2014.

Last month the company had said that it has lifted all three injunctions that had disrupted the project and it is on track with the revised construction schedule. It has acquired the majority of the licences it needs and also 95 per cent of land required for the pipeline.

According to Anglo American, Minas-Rio is a world class iron ore project with an estimated operating cost of approximately $30 per tonne over the life of the mine, which is highly competitive.

London-based Anglo American is one of the world's largest mining companies. Its businesses include iron ore and manganese, metallurgical coal and thermal coal base metals, and precious metals and minerals – in which it is a global leader in both platinum and diamonds. The company's mining operations span southern Africa, South America, Australia, North America, Asia and Europe.

In another major development involving Anglo American, its Amplats platinum subsidiary in South Africa is in talks with the government and unions over plans to cut around 14,000 jobs, as part of massive restructuring programme. On Monday, the company agreed to defer the consultations on the layoffs by a fortnight.