“SYDNEY— Rio Tint PLC approved a $1.9 billion bauxite project in northeastern Australia, bucking a trend among major resources companies of delaying new mines amid a profit-crunching slump in commodity prices.
The Anglo-Australian mining company, the largest supplier of bauxite to China, said it wants to position itself for a rebound in demand by developing its Amrun project, the biggest investment approved by its board this year
London-based Rio Tinto said the planned Amrun operation, formerly known as South of Embley, on the Cape York Peninsula of Queensland state would open in 2019 and initially churn out 22.8 million metric tons of bauxite a year. Bauxite is a raw material that is used to make alumina, a key ingredient in the manufacturing of aluminum.
Much of the early output from Amrun will offset declining production from the company’s East Weipa mine, also on the Cape York peninsula, where ore reserves are running out. Bauxite from the region accounts for roughly 10% of the world’s aluminum.
Rio Tinto aluminum chief Alfredo Barrios said the new investment wasn’t a defensive play to keep the company’s market share from shrinking. “The strategy is to grow and capture an opportunity that we see in the coming years,” he said in an interview.
Mr. Barrios said Rio Tinto expects China’s annual imports of bauxite to surge to 145 million tons by 2030, from around 45 million tons now. The rise is paralleled by a decline in supply of high-quality ore in China, which is the world’s top aluminum producer. ”
Wall Street Journal du 27 Novembre