2010 Annual report

Strategy

• To maximise shareholder value by contributing material earnings to Rio Tinto and delivering better than comparable industry returns.
• To benefit from increasing demand for Diamonds & Minerals’ products by improving the efficiency of the group’s existing assets, building the growth projects in its pipeline and growing through value accretive acquisitions in existing and new sectors.
• To share best practices in safety and community engagement in order to maintain employer and developer of choice status across the six continents that constitute our operations base.

Key achievements

• Lowest all injury frequency rate among Rio Tinto product groups.
• Commenced underground ore production at the Diavik diamond mine.
• Gained approval and funding to complete the Argyle diamond mine underground project in Australia.
• Launched a pre-feasibility study for the Bunder diamond project, India.
• Delivered flexibility and efficiency improvements through a new labour agreement at Rio Tinto Minerals’ (RTM) Boron Operations in California.
• Received a binding offer in early 2011 from Imerys to acquire Rio Tinto’s talc business for an enterprise value of US$340 million.
• Expanded deposit boundaries and identified additional sodium borate mineralisation at Jadar, a lithium and borates development project in Serbia.
• Rio Tinto Iron & Titanium (RTIT) increased titanium dioxide production by 21 per cent compared to 2009 in response to improved market conditions.
• Achieved the first full year of production of ilmenite ore at QIT Madagascar Minerals (QMM).
• Progressed construction of the tailings treatment plant at Richards Bay Minerals (RBM) ahead of start up in early 2011.

Key priorities

• Continue to strive for zero harm to people across all operations.
• Deliver material earnings and cash flow to Rio Tinto, and generate better than comparable industry returns.
• Differentiate Rio Tinto from other suppliers in Diamonds & Minerals’ markets by providing a reliable supply of high quality products, technical expertise and marketing support programmes.
• Ramp up to full production at QMM.
• Progress development projects to plan.
• Achieve incremental expansions at Rio Tinto Fer et Titane (RTFT) and Boron through efficiency and technology improvements.
• Identify and execute opportunities for inorganic growth.

Outlook

• Following recovery in 2010, the outlook for the product group’s markets is favourable, driven primarily by increased demand from emerging markets.
• The medium to long term fundamentals for the diamond industry are positive.
• Demand growth offers opportunities across titanium dioxide and borates.