Rio Tinto on track for $2.6 billion Gudai-Darri ramp up
The $2.6 billion Gudai-Darri replacement iron ore mine in Western Australia is progressing with production ramp-up on track for early 2022, according to Rio Tinto's Annual Report 2020.
The first phase of Gudai-Darri will have a 43Mt annual capacity, underpinning production of the Pilbara Blend.
Amid rising scrutiny on low-carbon operations and sustainability, work will begin on a 34MW solar plant, comprising around 100,000 solar panels, this year. The plant is expected to supply all of Gudai-Darri’s electricity demand during peak solar power generation times and approximately 65% of the mine’s average electricity demand.
Set to be one of the world’s most automated mines, Gudai-Darri’s autonomous fleet will include the world’s first autonomous water carts, to be launched in 2021. Delivered through a partnership with Caterpillar, the water carts will join its autonomous heavy mobile equipment fleet including haul trucks and autonomous drills.
The focus on sustainability is also designed to alleviate pressure on the company following the destruction of the rock shelters at Juukan Gorge, in which Rio Tinto acknowledged it must do better and its employee pride had been eroded. It has earmarked $50 million to attract, retain and support indigenous employees across Australia. The Yandicoogina mine, Pilbara, is pictured.
Product-specific results were as follows:
· Iron Ore $27.5 billion gross sales, $18.8 billion underlying EBITDA
· Aluminium $9.3 billion gross sales, $2.2 billion underlying EBITDA
· Copper & Diamonds $5.4 billion gross sales, $2.2 billion underlying EBITDA
· Energy & Minerals $5 billion gross sales, $1.6 billion underlying EBITDA
Three criteria need to be met in order for the Oyu Tolgoi copper project can start this year; chiefly outstanding government approvals, funding as agreed with Turquoise Hill Resources (TRQ) in an MoU in September 2020, and achieving power milestones agreed with the Government of Mongolia in June 2020.
On January 4, the government advised Rio Tinto that they were "dissatisfied with the results of the definitive estimate and the funding implications for the sharing of economic benefits between the shareholders of Oyu Tolgoi".
The report detailed a £7.2 million payment to ousted Chief Executive Jean-Sebastien Jacques last year, and eligibility for future share bonuses, which are worth up to £28 million at current prices.
Chairman Simon Thompson said Jakob Stausholm inherits a company "that urgently needs to restore trust with host communities and in our management of cultural heritage".
Gender diversity is another key focus in 2021 with women comprising only about 20% of Rio Tinto's workforce.
Capex rose 13% to $6.2 billion and the company ended 2020 with net debt of $0.7 billion. To read more on last week's results, click here.
Vale invests $150mn to extend life of Manitoba operations
Vale has announced a $150mn CAD investment to extend current mining activities in Thompson, Manitoba by 10 years while aggressive exploration drilling of known orebodies holds the promise of mining well past 2040.
Global energy transition is boosting the market for nickel
The Thompson Mine Expansion is a two-phase project. The announcement represents Phase 1 and includes critical infrastructure such as new ventilation raises and fans, increased backfill capacity and additional power distribution. The changes are forecast to improve current production by 30%.
“This is the largest single investment we have made in our Thompson operations in the past two decades,” said Mark Travers, Executive Vice-President for Base Metals with Vale. “It is significant news for our employees, for the Thompson community and for the Province of Manitoba.
“The global movement to electric vehicles, renewable energies and carbon reduction has shone a welcome spotlight on nickel – positioning the metal we mine as a key contributor to a greener future and boosting world demand. We are proud that Thompson can be part of that future and part of the low carbon solution.”
Vale continues drilling program at Manitoba
Coupled with today’s announcement, Vale is continuing an extensive drilling program to further define known orebodies and search for new mineralization.
“This $150mn investment is just one part of our ambitious Thompson turnaround story. It is an indicator of our confidence in a long future for the Thompson operations,” added Dino Otranto, Chief Operating Officer for Vale’s North Atlantic Base Metals operations.
“Active collaboration between our design team, technical services, USW Local 6166, and our entire Thompson workforce has delivered a safe, efficient and fit-for-purpose plan that will enable us to extract the Thompson nickel resources for many years to come.”
The Thompson orebody was first discovered in 1956 by Vale (then known as Inco) following the adoption of new exploration technology and the largest exploration program to-date in the company’s history. Mining of the Thompson orebody began in 1961.
“We see the lighting of a path forward to a sustainable and prosperous future for Vale Base Metals in Manitoba,” said Gary Annett, General Manager of Vale’s Manitoba Operations.