Exploration
Exploration is an integral part of the sustainable development equation for Rio Tinto. We have had a sustained commitment to exploration since 1946 and consider it to be one of our core competencies.
The purpose of exploration is to discover or acquire mineral resources that add value to our business. Our strategy is to find and mine only the largest, lowest cost resources that are profitable at all parts of the natural price cycle and that deliver a sustainable competitive advantage.
Each of the countries and regions we explore in has different cultures, peoples, laws and expectations. Wherever our exploration teams operate, we work hard to find ways to implement the highest international standards. Successful sustainable development outcomes help us achieve not just a licence to operate, but also a licence to grow.
- Approach
- Results
Some of our mature operations, such as Weipa, the Pilbara and Rössing, were greenfield discoveries made by Rio Tinto. The value of these discoveries is still being realised by both mine production and successful brownfield exploration after more than 40 years.
At the end of 2010, the Exploration group was actively exploring in 16 countries, and assessing opportunities in a further seven, for a broad range of commodities including bauxite, copper, coking coal, iron ore, diamonds, nickel, uranium and potash. We expect to explore for a range of commodities across at least 17 countries in 2011.
Continuing this legacy, since 2000, the Exploration group has identified two of the largest copper opportunities in the world at Resolution in Arizona, US and La Granja in Peru. Exploration has also delivered the world's largest known undeveloped high grade iron ore resource, at Simandou in Guinea, as well as the Caliwingina channel iron deposits in the Pilbara, Australia.
Exploration identified the Potasio Rio Colorado potash deposit in Argentina, the largest potash discovery in South America, which Rio Tinto has sold to Vale. In 2008 we handed over to the product groups for further evaluation the Sulawesi nickel deposit in Indonesia and the Mutamba ilmenite deposit in Mozambique, and in 2009 completed an Order of Magnitude study on the Jadar lithium borate deposit in Serbia.
A significant proportion of exploration expenditure is returned to Rio Tinto through the sale of Tier 2 discoveries. Over the ten year period 2000 to 2010, divestment of Exploration group projects has returned US$1,291 million for a net pre-tax exploration spend of approximately US$128 million. Over the period this translates to an average Tier 1 discovery cost of less than US$16 million per deposit.
We are currently actively exploring in 15 countries, and assessing opportunities in another seven. These cover a broad range of commodities including bauxite, copper, coking coal, iron ore, diamonds, nickel and uranium.
