JP Morgan has speculated that the Tom Price mine, which produces about 24 million tonnes of iron ore a year, has only three years of reserves. With the release of first half results, the board approved 8 million to complete the development of Silvergrass.
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However, net profit for the first half rose to $1.71 billion, more than double that of the first half of 2015 in which the company suffered one-time losses from exchange rates and derivatives.
Rio Tinto has warned of tough conditions ahead after the mining giant posted its weakest underlying profit in more than a decade.
The result came on the back of sales revenue of $US15.5 billion, $US2.5 billion lower than the previous corresponding period.
But now with iron ore in a raging bull market, it’s singing the praises of the project.
HSBC, which has paid $0.20 in two dividends for the current year, said it remained committed to sustaining its annual ordinary dividend at current levels “for the foreseeable future”.
It said commodity markets remained a challenge, even as the mining sector stages a recovery from the hammering inflicted by a plunge in prices for raw materials caused by a drop in Chinese demand. It said that the U.K.’s vote to leave the European Union would weigh on the world economy, and warned that a host of threats including geopolitical turmoil, rising protectionism and terrorist attacks could send growth into a deeper rut.
The company with United Kingdom and Australia roots reported its worst first-half earnings in 12 years, albeit in line with analyst expectations: profit was $1.56 billion, before one-time items, and represented a decline of 47%.
Like its peers, Rio Tinto has suffered amid the commodities rout, which has depressed the prices of its wares.
About $US580 million of those cuts have already been achieved, but Mr Lynch said the continuous expansions in the iron ore division had shielded it from the the full force of cost-cutting in recent years. Net debt was $12.9 billion, compared with $13.8 billion on December 31.
Anglo American plc (LON:AAL) opened at 827.70 on Thursday.
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Rio Tinto plc (Rio Tinto) is a global mining company. At the time, companies argued that if they didn’t expanded production, others would and erode their market share.
