Rio Tinto: Fourth quarter 2007 operations review

16 January 2008

Fourth quarter 2007 operations review

Commenting on the quarter and full year production results, chief executive Tom Albanese said: “Rio Tinto has pulled out all the stops to boost production in 2007 while our safety record has continued to improve. Investment to expand capacity in recent years is paying off with record volume growth in many commodities. We are driving the business at record pace, as these strong numbers clearly show.

“In 2007, we set annual production records for iron ore, bauxite, alumina, aluminium, refined gold, and refined copper on a like for like basis. With significant expansions in iron ore and aluminium and the contribution of the Alcan acquisition, which created the world’s leading aluminium producer, we are set to see an acceleration of this growth in 2008.

“Against a background of record prices for many of our commodities and with a strong outlook for the demand for our products in the developing markets, we look forward with confidence.”

. Rio Tinto’s iron ore production set a new annual record at 179 million tonnes in 2007. On an attributable basis 2007 iron ore production was 145 million tonnes, a nine per cent increase on the 2006 total.

. Fourth quarter attributable iron ore production was also a record, 11 per cent ahead of the fourth quarter of 2006 and seven per cent up on the previous quarter of 2007.

. The Pilbara operations continued their rapid expansion with the Hamersley mines raising production by 17 per cent compared with the fourth quarter of 2006. At the end of December 2007 the Pilbara ports were operating at a rate of 190 million tonnes per annum (164 million tonnes on an attributable basis).

. Rio Tinto’s newest iron ore mine, Hope Downs, commenced production in November 2007, three months ahead of schedule. With the first expansion already approved, it is expected to reach 30 million tonnes annual capacity in 2009 – a rapid and sizeable increment to production in the Pilbara.

. Fourth quarter bauxite, alumina and aluminium production were at record levels, increasing by 74 per cent, 133 per cent and 287 per cent respectively compared with the same quarter of 2006. This followed the Alcan acquisition and its subsequent integration with effect from 24 October 2007. On a proforma basis, excluding the Alcan acquisition, quarterly and annual production records were set for bauxite and aluminium.

. Mined copper production was five per cent higher than the third quarter of 2007 primarily reflecting increased throughput at Kennecott Utah Copper but decreased by 14 per cent compared with the same quarter of 2006, mainly due to lower grades at Kennecott Utah Copper and Northparkes.

. Rio Tinto’s position as a significant gold producer was confirmed by its 2007 share of mined gold production of 1.2 million ounces, a 23 per cent increase over 2006.

. Fourth quarter production of refined copper and refined gold rose 65 per cent and 98 per cent respectively above the 2006 fourth quarter level, reflecting a full quarter of production at the Kennecott Utah Copper smelter after the scheduled maintenance in the fourth quarter of 2006.

. Fourth quarter uranium production was 13 per cent higher than the prior quarter but 14 per cent lower than the 2006 comparative period. The Ranger operation processed higher grade ore following the implementation of dewatering strategies and optimisation of the mine plan, offsetting reduced Rössing production due primarily to lower grades.

All currency figures in this report are US dollars unless otherwise stated

A full copy of the press release is also available on the Rio Tinto website: www.riotinto.com/media

High resolution photographs available at Newscast www.newscast.co.uk

Rohini Meisuria
Adviser – Digital Communications
Communications and External Relations