Rio Tinto PLC's (RIO.US) newly appointed CEO, Simon Trott, has outlined plans to raise up to $10 billion for reinvestment in core operations while scaling back ambitious targets—including lithium ventures—to streamline the mining giant into a leaner business focused on iron ore and copper.
The company identified key growth and cost-cutting objectives, aiming to generate $5–10 billion in "cash proceeds" through asset divestments, minority stake sales, and restructuring existing financing. Trott confirmed these funds would be redeployed within the group.
Regarding lithium—a critical metal for rechargeable batteries—Trott emphasized a "phased approach." As the only diversified miner betting on lithium, Rio Tinto will prioritize existing projects, targeting 200,000 tons annual production by 2028. With lithium prices plunging due to oversupply, the group added that further investments would hinge on "market conditions and returns."
"The focus is on our biggest opportunities. Trying to do everything means achieving nothing," Trott stated. Assets under review include titanium and borate operations.
Rio Tinto aims to reduce average operating unit costs by 4% annually through the decade’s end. Additional measures include $650 million in productivity gains by Q1 2025 via operational simplification and pausing non-core projects.
Trott, formerly head of Rio’s iron ore division, is trimming what critics call a bloated organizational structure—particularly in support functions—by cutting senior roles and divesting non-core assets.
Glyn Lawcock, metals and mining analyst at Barrenjoey Markets Pty Ltd., noted: "They’ve mentioned sale-leaseback options for infrastructure like power stations and desalination plants. There’s capital cost arbitrage here. Trott’s strategy makes sense."
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