Australian mining giant Rio Tinto has announced its production results for the fourth quarter of 2008.
According to the company's release, its production for the quarter was in line with expectations. The company states that it has taken action in response to the global economic downturn and, given the resilience of its low cost assets, it expects to remain well positioned when the recovery starts.
In 2008, Rio Tinto's total annual iron ore production amounted to 175 million mt (142 million mt on attributable basis), marking a seven percent increase compared to 2007.
Rio Tinto's total iron ore production in Q4 came to 36 million mt (29 million mt on attributable basis), an 18 percent decrease (20 percent on an attributable basis) compared to the same quarter of 2007. The decline in production in the fourth quarter resulted in a rise in unit costs and a general tightening of margins.
Operations at the Channar and Brockman mines were suspended in November as the global market weakened. Following this suspension, all mine and rail operations across the Pilbara region shut down for two weeks in late December. Operations were restarted in early January 2009.
Moreover, the Hismelt operations were suspended for three months starting from mid-December, following the significant slump in pig iron demand.
As regards to its expansion projects, Rio Tinto stated that the Cape Lambert expansion to an annual capacity of 80 million mt has been completed and that the Hope Downs South mine has started iron ore production.
Earlier in January, Rio Tinto announced the postponement of its $371 million Automated Train Operations program in Western Australia. Furthermore, the company also announced the postponement of the $2.15 billion expansion project of the Corumba mine and associated logistics.