Rio Tinto has approved the next stage in the development of Richards Bay Minerals (RBM) in South Africa through the construction of the Zulti South project. The $463million (Rio Tinto share $343 million) investment will sustain RBM’s current capacity and extend mine life.
RBM currently operates four mines in the Zulti North lease area, a mineral separation plant and smelting facility. The Zulti North orebody grade is declining, hence the Zulti South mine is required to maintain the output of high-margin zircon and rutile, and provide sufficient ore to support TiO2 sales.
The Zulti South mine (Phase 1) will underpin RBM’s supply of zircon and ilmenite over the life of mine. Construction is scheduled to start in mid-2019, subject to the granting of all necessary permits, with first commercial production expected in late 2021. The investment will be fully self-funded from RBM’s cash flows, with no additional debt or recourse to Rio Tinto. The project is expected to deliver an internal rate of return of 24 per cent (Rio Tinto share).
Rio Tinto chief executive J-S Jacques said “Rio Tinto has a long history in South Africa, and today’s investment underscores our commitment for the coming decades and beyond. Zulti South is one of the best undeveloped minerals sand deposits in the industry, and will significantly extend RBM’s position as a world-class, first-quartile asset. The long-term fundamentals of the market remain strong, and production from Zulti South will commence in time to fill a widening supply gap, ensuring RBM’s position as a leader in the sector, and delivering strong returns to our shareholders.”
Rio Tinto Energy & Minerals chief executive Bold Baatar said “RBM is an outstanding business, South Africa’s largest mineral sands producer and, equally importantly, a fully beneficiated metallurgical complex. We not only mine, but produce value-added products for customers around the world. We are proud of the value we create, and retain, in South Africa. This is underscored by our position as KwaZulu Natal’s leading taxpayer, paying $79 million in taxes and royalties in 2018 alone.
“Our investment in Zulti South will ensure we maintain our contribution to the province and our partner communities. We want to recognise the support from the Government of South Africa, the KwaZulu Natal provincial leadership and, most importantly, the invaluable support of our host communities – Mbonambi, Sokhulu, Mkhwanazi and Dube – in securing the future of this world-class business.”
Rio Tinto details $42.8 billion of direct economic contribution and $6.6 billion of taxes and royalties paid globally in 2018
Rio Tinto has published its latest Taxes paid report detailing the $6.6 billion of taxes and royalties paid globally in 2018, up from $5.1 billion in 2017. The report also outlines Rio Tinto’s direct economic contribution of $42.8 billion during 2018.
Australia accounted for the largest portion of the taxes and royalties paid ($4.8 billion), with significant amounts also paid in Canada ($386 million), Chile ($332 million), the United States ($331 million), Mongolia ($308 million), Europe ($146 million) and Africa ($132 million).
Rio Tinto chief financial officer Jakob Stausholm said "The taxes we pay to national, regional and local governments are an important element of the contribution we make to the societies in which we operate. Our payments enable various governments to provide essential services to communities and to invest for the future.
"Our overall contribution is far broader than the taxes and royalties we pay, including direct investment in communities, job creation and significant investments with suppliers. In 2018 alone, Rio Tinto's direct economic contribution globally was $42.8 billion, including payments to 37,000 suppliers in over 120 locations."
Since Rio Tinto voluntarily published its first Taxes paid report in 2010, the company has paid $63.0 billion of taxes and royalties globally of which $45.8 billion was paid in Australia.