Rio Tinto and Sinosteel announced an agreement on April 15 to extend their Channar Mining joint venture in Western Australia’s Pilbara region. The joint venture is held 60% by Rio Tinto and 40% by Sinosteel, and is managed by Rio Tinto. The original Channar agreements for the production of 200 million mt of iron ore were signed in 1987 and represented the first major Chinese foreign investment in the Australian mining industry. First ore was produced in 1990.
The Channar mine is located 60 km south of Tom Price and produces about 10 million mt/y of iron ore. The current Channar joint-venture extension, together with a separate agreement for Rio Tinto to supply Sinosteel with iron ore from other Pilbara mines, will enable sales of up to 70 million mt of iron ore to Sinosteel over the next five years.
Rio Tinto Iron Ore Chief Executive Andrew Harding said, “In the 50 years that we have been exporting iron ore from the Pilbara, the Channar joint venture stands out as one of the most important deals, not only for our business but for Australia’s economic ties with China. Now in its 13th year, it is one of the longest running and most successful partnerships between the two nations.”
Sinosteel President Liu Andong said, “The Channar Mining joint venture was the first large-scale mining initiative between our two countries and is a cornerstone of Chinese and Australian trade. The extension of the joint venture marks another milestone in trade cooperation, especially in the current economic climate.