Rio Tinto To Begin Potassium Project Construction In 2009

Published by MAC on 2007-04-05
Source: Business News Americas

ARGENTINA

Rio Tinto to begin potassium project construction in 2009

Argentina BNAmericas,

5th April 2007

Anglo-Australian miner Rio Tinto is set to begin construction works on the Río Colorado potassium project in Argentina's Mendoza province by end-2009 or early 2010, a company spokesperson told BNamericas.

The timeframe is contrary to a February announcement by Argentina's mining ministry that construction would begin in the first quarter of 2007.

In January, the company presented an environmental impact study (EIS) to provincial authorities for the project, located in Malargüe in southern Mendoza. Output is expected to be 2.4Mt/y.

Project construction - which looks at total investment of US$900mn - will take nearly two years and the production stage will generate close to 850 direct and around 10,000 indirect jobs, according to the spokesperson.

In addition, the spokesperson was unaware of whether officials have rejected the company's saline waste management plan. Previous press reports said that the Río Colorado inter-jurisdictional committee (Coirco) had questioned the proposal.

The company and Coirco representatives met with Mendoza mining authorities to discuss several aspects of the project, specifically the disposal of salt. "No one voiced opposition as far as we know," the spokesperson said.

Coirco is an official entity made up of representatives from the provinces of Mendoza, La Pampa, Neuquén, Río Negro and Buenos Aires.

The executive also said that Rio Tinto has never complained about the provincial government's delay in awarding permits to begin works in the zone, as some press reports alleged.

"The company never complained. It hasn't said anything. That is untrue. We are in constant contact with the authorities," the spokesperson said.

Startup of Río Colorado would make Argentina Latin America's largest potassium chloride producer. Its main market would be Brazil, which accounts for 73% of regional consumption.

Some 95% of potassium chloride is used as a fertilizer in tropical areas, but the mineral also has chemical and pharmaceutical applications.

By Harvey Beltrán
Business News Americas