Rio Tinto plans production increase with rise in exports
RIO Tinto's Central Queensland coal projects have delivered a mixed result for the multi-national powerhouse as it celebrated record-breaking exports of iron ore from its Pilbara operations.
Despite forecasts showing it will eclipse its coal totals from 2011, the company has made it plain, in its latest report, that it was still trying to save money.
The third quarter production results released to the ASX on Tuesday showed Rio Tinto's metal-making coal or coking exports fell 16% compared to the same three months last year.
It blamed the production fall on Hail Creek needing dragline maintenance and Kestrel having a large-scale plant shut-down as the project continues its expansion.
Its thermal coal mines - delivering coal used for electricity - fared better with an 18% increase over the same three months in 2011.
By year's end, Rio Tinto is expecting to have upped its coal production compared to last year, moving 31.5 million tonnes compared to 29.5 million tonnes in 2011.
In the report, Rio stated, "In response to ongoing cost pressures and high inflation impacting the coal business in Australia, Rio Tinto is taking actions to reduce controllable costs and increase productivity".
The Sydney Morning Herald reported less than a week ago that Rio had cut $US500 million from its budget this year "including hundreds of Australian jobs", something chief executive Tom Albanese confirmed during a speech in London.
"So far we've already hit $US500 million of annualised savings … and are planning further significant reductions in operating, evaluation and sustaining capital spend," he said.
"That will involve reductions in employment levels."
Mr Albanese touched on that briefly in his address on Tuesday.
"As we said at our Investor Seminar last week, markets remain volatile but our business is resilient and our operations are performing strongly, reflecting our consistent strategy of running large, long-life, cost-competitive operations," he said.
BHP Billiton will release its quarterly production report on Wednesday.