Fourth quarter 2011 operations review
Chief executive Tom Albanese said “This was another record-breaking year in the Pilbara with both quarterly and full year iron ore production and shipments beating previous achievements, as our expansion programme continues apace. Across the Group, production has bounced back from the severe weather conditions experienced in the first half which had the biggest impact on Australian iron ore, coal and uranium.”
• Record global iron ore shipments of 239 million tonnes in 2011 were below production due to extreme weather conditions experienced in the first half of the year. Despite this, Rio Tinto’s Pilbara ports operated at above annualised capacity rates and shipped record volumes of 61 million tonnes in the fourth quarter and 225 million tonnes for the full year.
• Record global iron ore production of 65 million tonnes was achieved in the quarter (51 million tonnes attributable) and 245 million tonnes for the full year (192 million tonnes attributable).
• Lower grades at Escondida and Kennecott Utah Copper impacted mined copper throughout most of 2011, driving production down 23 per cent year on year, in line with guidance.
• Full year bauxite production was seven per cent higher than 2010. Aluminium was one per cent higher whilst alumina was one per cent lower. The Group’s annual aluminium capacity has been reduced by 462,000 tonnes across the entire portfolio, due to the orderly shutdown of two thirds of Alma and power issues at Lynemouth and Shawinigan.
• Australian hard coking coal production was 16 per cent higher than fourth quarter of 2010 and two per cent lower year on year. Australian thermal coal was three per cent lower year on year whilst semi-soft coal production slipped seven per cent compared with 2010.
• On 19 October 2011, Rio Tinto made a recommended all-cash offer for Hathor Exploration and successfully completed the acquisition on 12 January 2012.
• Following the approval of an additional $2.7 billion capital investment to modernise the Kitimat aluminium smelter, total capital expenditure for 2012, on approved projects and sustaining capital, is expected to be $15 billion. Further project approvals are likely to increase this level of investment.
• On 13 December 2011, Rio Tinto announced that an independent arbitrator upheld Rio Tinto's claim in respect of Ivanhoe Mines' Shareholder Rights Plan. After the standstill agreement expires on 18 January 2012, Rio Tinto will have the ability to purchase additional shares in Ivanhoe beyond its current holding of 49 per cent without being diluted.
• At 31 December 2011, Rio Tinto had bought back $5.5 billion or 91 million of its plc shares under its $7 billion buy-back programme to be completed by the end of the first quarter of 2012.
All currency figures in this report are US dollars, and comments refer to Rio Tinto’s share of production, unless otherwise stated
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