Ceramic Industry

Rio Tinto Moves Toward Australian Bauxite Expansion (posted 7/2/08)

July 2, 2008

Rio Tinto has approved a $30 million feasibility study to develop a new bauxite operation to the south of the existing Weipa bauxite mine and port. This is the first step towards significantly expanding Rio Tinto’s operations at Weipa in Cape York, Queensland, Australia. With the approval of the new operation, Weipa’s total bauxite production would increase from 18.2 million tonnes in 2007 to 35 million tonnes, giving the group increased capacity to supply bauxite to customers globally and to Rio Tinto Alcan-owned refineries. The new development would eventually replace the existing east Weipa mine and provide a platform for further expansion to take advantage of the large bauxite reserves and resources in the region south of the Weipa peninsula.

“The proposed mine development to the south of the current operations will allow Rio Tinto Alcan to maximize further value from its world-class Weipa bauxite deposits,” said Steve Hodgson, Rio Tinto Alcan president and chief executive, Bauxite and Alumina. “Rio Tinto Alcan has a strong growth pipeline of projects, and the Weipa operation is a vital cornerstone for our global aluminum business. The feasibility study will also examine a new port and stockpile facilities that would be built at a cost of about $400 million to service the new mine. This project will ensure the future growth of Rio Tinto Alcan’s alumina business on Australia’s east coast. It supports our decision in 2007 to invest $1.8 billion to expand the Yarwun alumina refinery in Gladstone and will underpin Rio Tinto Alcan’s plans to be a major participant in the global third-party bauxite sales market. The aluminum market remains strong, and this extension supports Rio Tinto’s strategy of developing large, long-life, value-adding assets. Production from the mine extension will increase as demand for bauxite increases.”

The feasibility study and environment impact statement for mine development on the existing mine lease south of the Weipa peninsula will take one to two years. The mine development, if approved, would take three years to construct, with first production expected in early 2013. Under the study, the development has an estimated capital cost of approximately $1 billion (in nominal terms), including port costs, and would include the development of port facilities, a transport system, power station, a beneficiation plant and operation support infrastructure. It will be subject to government and environmental approvals.

For more information, e-mail questions@riotinto.com or visit www.riotinto.com.