Rio Tinto and China’s Sinosteel Corporation have agreed to extend their historic Channar Mining Joint Venture that owns the Channar mine in the Pilbara region of Western Australia.
Rio Tinto Iron Ore chief executive Chris Salisbury said the move represents the third extension of the JV and will increase the life of the joint venture to cover production totalling 290 million tonnes.
“The Channar joint venture is one of Australia’s most significant trading partnerships and has helped pave the way for the incredibly strong relationship we have forged with China today,” Mr Salisbury continued.
“This extension represents another milestone in our 30-year partnership that has seen more than 250 million tonnes of iron ore delivered from the Pilbara to China.”
According to the company’s statement, the extension – subject to approvals from the Western Australian, Australian and Chinese governments – will see Sinosteel make an upfront payment of US$15 million to Rio Tinto as well as production royalties linked to the iron ore price.
The original Channar joint venture (Rio Tinto share 60%, Sinosteel share 40%) was signed in 1987 and provided for the production of 200 million tonnes of iron ore.