Rio Tinto released its second quarter of 2020 production results. The company achieved a robust production performance with volumes up 1 per cent compared with the second quarter of 2019 on a copper equivalent basis despite significant global challenges, restrictions related to COVID-19 and the impact of the earthquake at Kennecott, Utah, in the United States.
Rio Tinto Chief Executive J-S Jacques said, “We delivered a strong performance, particularly in iron ore and bauxite, demonstrating the underlying resilience of our business and ability to adapt in difficult conditions. Our iron ore assets are performing well in a strong pricing environment and we are on track to meet our 2020 iron ore guidance. Despite various COVID-19 related challenges, all our assets have continued to operate, with our first priority to protect the health and safety of all our employees and communities.
“Our focus is to maintain a business as usual approach with many safeguards at a very unusual time. Our operational teams are continuing to run our assets safely so we can continue to contribute to local and national economies and serve our customers. We remain even more committed to our relationship with communities, following the Juukan Gorge events in the Pilbara, and we are engaging extensively with Traditional Owners around our operations and across Australia.
“We are executing our value over volume strategy to drive performance, productivity and free cash flow per share. We will remain agile and ready to adapt to the changing operating and macro environment,” he concluded.
Pilbara iron ore shipments of 86.7 million tonnes (100 per cent basis) were 1 per cent higher than the second quarter of 2019 despite the impact of COVID-19 related operational controls. With 1.7 million tonnes of port sales in the second quarter, Rio Tinto continues to grow its portside business steadily, looking to better serve existing customers and open opportunities to sell to new customers who do not participate in the seaborne market.
Bauxite production of 14.6 million tonnes, which was 9 per cent higher than the second quarter of 2019, continued the first quarter trend following the successful ramp-up of the Amrun mine in Queensland, Australia in 2019, and higher production at the non-managed CBG joint venture in Guinea reflecting good progress on the ramp-up of the expansion.
Aluminium production of 0.8 million tonnes in the second quarter was 2 per cent lower than the second quarter of 2019 primarily due to pot relining at Kitimat (Canada), the decision to operate the ISAL smelter (Iceland) at 85 per cent capacity and the curtailment of the fourth pot line at the company’s New Zealand Aluminium Smelter (NZAS) in April 2020 due to COVID-19 impacts. On 9 July, Rio Tinto announced the wind-down of operations and eventual closure of NZAS following the conclusion of the strategic review.
Second quarter mined copper was 3 per cent lower than the same period of 2019 due to lower head grade at the Kennecott mine in the U.S. Second quarter refined copper was 67 per cent lower than the same period of 2019 due to the impact from the 5.7 magnitude earthquake in the first quarter resulting in an unplanned flash converting furnace rebuild at Kennecott, in addition to the planned 45-day smelter shutdown in May/June.