Palabora’s principal asset is a copper mine in South Africa, which has a current mine life until early 2016.
Rio Tinto said that studies are underway for a potential extension of this mine’s life to 2030 but it is no longer of sufficient scale to fit with its strategy.
A magnetite stockpile is also owned by Palabora, and the future of value creation at Palabora is likely to involve beneficiation of the magnetite through on-site processing, an activity that is outside Rio Tinto’s strategic focus.
Rio Tinto Copper chief executive Andrew Harding said that Rio Tinto is no longer the natural owner of Palabora due to the limited opportunity to significantly expand copper mining.
"We believe Palabora has a solid future under an owner who can develop the magnetite business alongside the existing copper and vermiculite operations," Harding said.
