Rio Tinto leaves no hope to achieve a record production of iron ore

The desire of Rio Tinto to achieve the production of 360 million tons of iron ore per year is considered quite likely, despite the problems with the expansion of the Pilbar base. Analysts believe that the mining giant puzzled by the position of his port, railway construction and the operation of mines in the north-west of Australia will reduce the costs of iron ore development.

Rio Tinto plans to target costs of 5 billion dollars in the total operating room by the end of 2014. In addition, it has yet to be resolved by the issue of allocating funds to expand the production of iron ore to reach 360 million tons per year. The UBS analyst believes that the company will achieve the goal after the commissioning of the next stage of the Pilbar complex this week, which will make up to 290 million tons per year.

This will be just one step forward in order to ultimately reach 360 million tons. The goal will be realized by expanding existing assets and the development of one or two new mines. The Board of Directors Rio Tinto is expected to make a decision and develop a strategy for expansion by the end of the year to 360 million tons. Considering that the company has already invested more than 3.5 billion dollars in infrastructure development, UBS analyst believes that the board of directors is unlikely to wait longer in order to approve the plan for further expansion and a set of measures necessary to achieve the goal.