Rio Tinto Increases Australian Coal Reserves

   By David Winning 
 

SYDNEY--Rio Tinto (RIO) unveiled a 41% increase in its thermal-coal reserves in eastern Australia's Hunter Valley region, giving a boost to a division that has grappled with a prolonged period of low prices for the fuel.

Rio Tinto said its ore reserves increased by 546 million metric tons to 1.88 billion tons following a drilling campaign in the region and the use of new technology to estimate how much coal lies beneath the ground. Thermal coal is mainly burnt to generate power.

"This discovery of greater coal reserves and resources is the result of more than a year's work and forms part of our wider efforts to deliver greater value to our shareholders," said Chris Salisbury, managing director of Rio Tinto Coal Australia. "We continue to examine our asset base for further opportunities."

The upgrade comes in the wake of moves by Rio Tinto to sell off coal assets and close mines to protect profits. Glencore PLC (GLEN.LN) acquired Rio Tinto's majority stake in the Clermont coal mine in eastern Australia for around US1 billion, while Rio Tinto also tried to find a buyer for a minority stake in its Coal & Allied unit that owns the Hunter Valley mines.

-Write to David Winning at [e-mail]

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