Rio Tinto appeals for approval of mine expansion
In April, Rio Tinto appealed to Australia’s Supreme Court to overturn a state court ruling that blocks plans to extend the life of Mount Thorley Warkworth thermal coal mine in New South Wales state. The expansion of the mine is being opposed by local residents who fear it will affect the environment.
On May 8, Rio Tinto PLC’s chief executive Sam Walsh said he was hopeful that an expansion of the mine, one of the company’s biggest Australian thermal coal mines, would go ahead, despite the ruling by the state court.
“The future of an Australian business has potentially been compromised,” Walsh told an annual meeting of the company's shareholders in Sydney, Fox Business reported. “I remain hopeful that we will reach a solution that meets the needs of all parties involved.”
New South Wales’s Land and Environment Court had earlier upheld an appeal against the expansion of the Mount Thorley Warkworth mining operation by area residents. The judge in the case ruled the project would have unacceptable impacts on biological diversity, endangered ecologies, communities, noise and dust.
That ruling came as mining companies struggle to remain profitable following a slump in prices for thermal coal used to generate electricity and steelmaking coal. As part of a drive to cut costs and bolster its balance sheet, Rio Tinto is seeking to sell smaller assets, including some coal mines in Australia.
Walsh urged the Australian government to provide “stable fiscal and regulatory frameworks,” especially given the high operating costs Australia's mining industry is facing.
“I expect an Australian government to see it in the nation’s best interest to maintain business-friendly investment policies, thus ensuring Australia maintains its competitive position,” Walsh said.