Trouble at Mill Hits Rio Tinto Copper Output

SINGAPORE, July 15 -- Rio Tinto's (RIO.AX)(RIO.L) mined copper output fell 1 percent in the second quarter of 2009 from a year earlier as continuing problems at its Escondida joint venture in Chile, the world's largest copper mine, were offset by rising output elsewhere.

    Rio Tinto said its share of mined copper from Escondida, which it owns jointly with BHP Billiton (BLT.L)(BHP.AX), fell by 41 percent from the same period last year to 76,200 tonnes, while in the first six months, contained copper output dropped 37 percent to 154,300.

    The company said lower concentrator head grades and lower throughput following SAG mill motor issues and lower ore production from the Escondida Norte pit lay behind the fall.

    Third quarter production was also likely to be lower while the company repairs the equipment.

    "A 45 day concentrator shutdown is scheduled for July and August 2009 to remedy the SAG mill motor problems."

    But the fall at Escondida was offset by sharp increases at its other big operation in the United States and Indonesia.

    Mined copper and gold output rose year on year by 43 percent and 74 percent respectively at the Kennecott Utah Copper complex.

    "Following a decline in the molybdenum market, the mining sequence was refocused with a bias for the delivery of copper and gold," the report said.

    Rio said pockets of high grade ore also contributed to the surge in output.

    Mined copper output was 160,900 tonnes in the first half, up 53 percent from the same period in 2008, while cathode production increased 32 percent in the six months to June, to 133,700 tonnes.

    Rio's share of cathode output at Escondida increased by 22 percent over the second quarter of 2008 and 10 percent compared with the first quarter of 2009.

    The Anglo-Australian miner's cut of mined copper from the Grasberg mine in Indonesia leapt more than 1,300 percent to 50,100 tonnes in the first half, helped by improved ore grades.

    (Source: Reuters)