Rio Tinto is all set to embark on a new Chinese joint venture and expand an existing one in place with Sinosteel. The Sinosteel deal involves extending the existing Channar iron ore joint venture in Australia. The expansion will help produce an extra 50 million tonnes of iron ore.
The deal signed in 1987 was originally for producing 200 million tonnes of iron ore from deposits in the Pilbara region. The JV was owned 60% by Rio Tinto and 40% by Sinosteel. It is currently producing 10 million tonnes of iron ore annually as per figures released by Rio Tinto.
The new joint venture is between Rio and the Aluminum Corp of China to explore for minerals in China, mainly copper and coking coal. This new deal should help ease tensions in China for the company as well following the recent deterioration in Chinese relations for Rio when it refused Chinalco’s bid to increase its stake in the company.
Rio Tinto is also looking at more exploration deals in other countries such as the Simandou iron ore project in Guinea.