Mining industry at inflection point: Rio chair

RIO Tinto chairman Dominic Barton says the company has laid the foundations to become the global miner of choice.

 Rio Tinto chairman Dominic Barton

Rio Tinto chairman Dominic Barton

Addressing the company's Australian annual general meeting for the first time since he became chairman last year, Barton said he was pleased with Rio's progress on building trust with stakeholders and improving its culture.

"Today, Rio Tinto is arguably more relevant and aligned with societal aspirations than we have ever been," he said.

Barton said the drive to net zero, coupled with security of supply, was an opportunity for Rio.

Citing the International Energy Agency, he noted that if the world was to meet Paris climate goals, it would need 700 million tonnes of copper in the next 20 years - the same amount produced in Rio's entire 150-year history.

The world need to increase wind power capacity by eightfold by 2050.

"To put this into perspective, one wind turbine of three megawatts requires: 300 tonnes of steel; 5t of copper; 3t of aluminium; and 2t of rare earths," Barton said.

"And electric vehicles and battery storage will raise lithium demand more than 40 times by 2040; cobalt and nickel could increase over 20 times over the same period.

"So, we have a critical role to play in enabling the energy transition, supplying essential minerals, including copper, lithium, high-grade iron ore and aluminium, all of which are vital for the transition to a low carbon economy."

Barton warned that within that purpose, there was also a fundamental tension.

"Meeting the needs of both the energy transition and continued global growth raises environmental and societal dilemmas," he said.

"As a business and as a society, we need to acknowledge and balance these dilemmas in our decision-making as they involve some difficult trade-offs. And we need the help of our stakeholders in solving these. The big question to work through together is: how do we fulfil our role in the energy transition in a way that is socially and environmentally responsible, and yet sufficiently commercial, to attract the investment required?

"What I can say is that in meetings I have conducted with investors, governments, community leaders and other stakeholders since joining, there is an ever-increasing acknowledgment that mining is viewed as a critical industry in reliably and securely supplying the materials that the world needs for the energy transition."

CEO Jakob Stausholm echoed those comments in his address, saying there was a growing awareness for mining's role in decarbonisation.

Barton said the mining sector was at an inflection point.

"We can be a catalyst of the green economy and potentially of transformative social impacts as we get to the unexplored corners of the world through mining, processing and recycling," he said.

"We have key parts of government and society pushing us to develop and expand mining projects, but at the same time we have some stakeholders pushing back on any mining development."

Barton said that was where trust came into it, along with responsibilities and obligations.

"We face new expectations that require a more open, transparent approach to the development and governance of natural resources," he said.

The chairman praised Stausholm for his work on improving company culture.

Stausholm said visiting the Rio's sites around the world gave him confidence the company was on the right track in restoring the company's DNA as the best operator in the sector, driven by culture changes.

"When people feel respected and valued, they feel empowered to be their best selves and bring their best ideas," he said.

"Achieving culture change - and our objective of best operator - will take time, but we are heading in the right direction."

Barton said the global environment had become more complex in 2023.

"We will need to maintain a keen eye on both near-term opportunities and risks, while also being able to capture strategic opportunities for the longer term," he said.

"It is certainly an exciting time to be at Rio because we believe that we can add value in this complex global operating environment.

"There is again a sense that the company has reached an inflection point, with strong momentum in the business. And as we turn 150, I am confident we have all of the right ingredients in place - great people, world-class assets, emerging technologies and new partnerships."

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.

A growing series of reports, each focused on a key discussion point for the mining sector, brought to you by the Mining News Intelligence team.


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