Rio Tinto to enter nickel market

Rio Tinto is to invest US$300m in the development of Eagle, a high-grade....

  Rio Tinto is to invest US$300m in the development of Eagle, a high-grade nickel and copper mine in Michigan, USA.Eagle will be the only primary nickel mine in the United States and is projected to deliver 16,000 tonnes of nickel per year over seven years, from late-2009 until 2016. Eagle will also produce valuable co-products of copper, platinum, palladium and cobalt.Rio Tinto is also in final contract negotiation to develop a nickel mine at Sulawesi in Indonesia, with an initial operation of 46,000 tonnes per year—first production commencing by 2015.Rio Tinto Copper Group Chief Executive, Bret Clayton said Eagle gives Rio Tinto a valuable opportunity to enter the market for nickel, a key input into stainless steel. Mr Clayton said demand for nickel is rising strongly led by the development of new infrastructure in developing economies, as well as rising demand for consumer products and the development of associated processing plant and equipment."Eagle is just one of many projects that will add to Rio Tinto’s growth and value. It is a 4.1 million tonne high-grade nickel resource (3.6% nickel, 2.9% copper) in a highly prospective region for additional nickel discoveries,” he said. “Our exploration team discovered Eagle in 2002 and we are now reviewing over 450,000 acres of mineral title we have in the area. “Our focus is on six further adjacent prospects that may have the potential to extend significantly the mine life at current planned production rates," Mr Clayton said.A two-year project construction phase will get underway in 2008, upon receipt of additional approvals expected in 2008. Three required permits were granted on December 14, 2007. Eagle's mine permit is the first issued by the State of Michigan under the state's 2004 nonferrous metallic mining law, considered among the most stringent in the US. The project is located in northwest Marquette County near the City of Marquette.