Rio Tinto is providing an update on its long-term strategy to strengthen the business, grow in a decarbonising world, and continue to produce attractive shareholder returns at its Investor Seminar.
In a statement, Rio Tinto said its market outlook will be included in the updates, with the energy shift estimated to add up to 25 per cent in new demand above existing sources on a copper equivalent basis across the Group’s core products by 2035. Rio Tinto plans to invest up to $3 billion in growth each year to meet this demand, including the Oyu Tolgoi copper, Rincon lithium, and Simandou iron ore projects.
Rio Tinto Safe Production System (SPS) deployments have now reached 30 across 16 sites. Continuous improvements in safety, employee satisfaction, and operational performance are being implemented across Rio Tinto’s global portfolio, with up to 5 million tonnes of additional output projected at the Group’s Pilbara iron ore operations in 2023.
Executives will discuss current projects undertaken to fulfil ambitious decarbonisation targets of halving Scope 1 and 2 emissions by 2030 and reaching net zero emissions by 2050. Six extensive emissions reduction programs, supported by high-quality nature-based solutions, are focusing on renewable power, process heat, diesel, and the ELYSIS zero carbon aluminium smelting technology to drive the transition to net zero by 2050. Approximately $7.5 billion in investments are projected between 2022 and 2030, including approximately $1.5 billion in back-end-dated investments during the next three years.
According to Rio Tinto, investments are prioritised and phased logically, with consideration for near-term work centred on energy inputs and attractive economics. The aluminium industry will also require new long-term power contracts to reach its ambitions. In addition to R&D investment, incremental operations expenditure on establishing new teams and energy efficiency measures stays around $200 million yearly.
Rio Tinto Chief Executive Jakob Stausholm said: “We are now creating real momentum, to build a stronger Rio Tinto that is a platform for delivering long-term value. From evolving our culture, to operational improvements, a different approach on cultural heritage, and technology breakthroughs to address climate change and a changing customer environment, we are seeing early results that give us conviction we have the right objectives, the right team, and the right strategy. This is all captured in our newly defined purpose: finding better ways to provide the materials the world needs.”
Stausholm stated meeting the incremental demand of the energy transition and securing local supply of essential minerals around the world increases our global significance and opens up new opportunities. Stausholm added that Rio Tinto is working hard to decarbonise our assets and goods while investing in the materials required for the energy transition.
“The quality of our assets, resilience of cashflows and strength of our balance sheet ensure we are well positioned to continue to invest with discipline for the long term and deliver attractive returns to our shareholders throughout the cycle,” he said.
Production forecasts for 2023 have been provided. Pilbara iron ore shipments of 320 to 335Mt (100 per cent basis) are predicted in 2023, with mid-term capacity staying at 345 to 360Mt.
