Companies

Chinalco, Rio Tinto set up China exploration JV

(Agencies)
Updated: 2011-06-02 13:40

Global miner Rio Tinto?and Chinese aluminum producer Chinalco have established a joint venture to explore for new mineral deposits in China, they said on Wednesday.

The new joint venture, the Chinalco Rio Tinto Exploration Co Ltd, will be 51 percent owned by the Chinese firm and will concentrate on copper exploration as its "immediate priority", with coal and potash to be considered at a later stage, Rio Tinto said.

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The joint venture will explore "prospective areas proposed by the Ministry of Land and Resources", Rio Tinto's chief executive Tom Albanese said in a statement.

"The joint venture will be focusing on the tier one opportunities that will bring the greatest benefit to China, and we know that such discoveries are rare but our chances are greatly improved by selecting the right areas to explore and combining the complementary skills of Rio Tinto and Chinalco," he said.

Chinalco has sought to diversify its business away from aluminum, and its listed unit Chalco has already agreed to invest $1.35 billion in the Simandou iron ore deposit in Guinea, another joint project with Rio Tinto.

Rio Tinto has been anxious to rebuild ties with Chinalco after rejecting a $19.5 billion investment bid from the Chinese firm in 2009. Chinalco remains Rio Tinto's largest shareholder, with a 9 percent stake.

Under the joint venture agreement, which is subject to Chinese regulatory approval, Chinalco will nominate three directors to CRTX, including the chairman and chief financial officer, while Rio will appoint two directors, including a general manager responsible for day-to-day operations.