Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
A Rio Tinto Plc plant in Quebec is getting an upgrade — and backing from Canada’s government — to help the mining giant slash greenhouse gas emissions and boost output of metals crucial to electric vehicles.
Rio Tinto is spending about C$515 million ($374 million) on its Fer et Titane plant in Sorel-Tracy, Quebec for upgrades that include electrifying furnaces and replacing coal in a push to cut the facility’s carbon emissions in half by 2030.
The Canadian government agreed to invest as much as C$222 million in the project, which will also see Rio Tinto increase production of minerals including titanium and scandium at the 72-year-old plant.
The plant “has not been very profitable for the last 10 years,” Rio Tinto Chief Executive Officer Jakob Stausholm said in an interview. “It could be very difficult to make such investments, but I now happen to believe that the world is changing — there is not just increasing demand, but increasing demand for greener products.”
Rio Tinto plans to quadruple its production capacity of scandium oxide to reach up to 12 metric tons a year, giving the company a 20% global market share, after adding new modules to the plant. The mineral, which is used in solid oxide fuel cells and aluminum alloys, is mainly produced in Russia and China.
Rio Tinto is also setting up a pilot plant at the facility to assess new processes for extracting and refining titanium metal, with the plant expected to be done by the end of 2023.
The federal government investment is through the Strategic Innovation Fund and comes as the Canada pushes to position the country as a global leading supplier of critical minerals needed to help industries, including aerospace, automotive and defense, transition to cleaner energy sources.
“As we develop supply chains the world needs from a reliable partner like Canada, the money we are investing is going to return to Canadians,” said Prime Minister Justin Trudeau.
(By Mathieu Dion)
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