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Rio Tinto embarks on joint venture for iron ore project
Rio Tinto has been advised on entry into a joint venture with respect to the Western Range iron ore project in the Pilbara, Western Australia, with China Baowu Steel Group (Baowu).
Jess Feyder
Firm: Corrs Chambers Westgarth (Rio Tinto)
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Deal: Corrs Chambers Westgarth has advised Rio Tinto on its joint venture with Baowu. Rio Tinto (54 per cent) and Baowu (46 per cent) will invest US$2 billion to develop the mine.
Value: US$2 billion
Area: Projects
Key players: The Corrs Chambers Westgarth team was led by head of corporate Sandy Mak with support from partners Anthony Lepere, Clare Corke and James Morley.
Deal significance: Rio Tinto and Baowu have also agreed to enter into an iron ore sales agreement at market prices, covering a total of up to 126.5 million tonnes of iron ore over approximately 13 years.
The establishment of the joint venture is subject to satisfaction of various conditions precedent, including approvals from Rio Tinto shareholders, the Australian government, Chinese government regulatory agencies, and the Western Australian government, among others.
Ms Mak commented: “We are pleased to have assisted Rio Tinto to achieve a significant milestone with Baowu and to commence the next phase of investment in its iron ore business.”
Construction is expected to begin in early 2023, with first production anticipated in 2025.
