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Chief executive Sam Walsh applauded by investors for Gove decision
Edited by : AL CIRCLE
2 min read
Rio Tinto (RIO) was the FTSE 100's top performer for the second morning running on Friday after the mining major announced the suspension of production at its Gove alumina refinery.
Chief executive Sam Walsh was applauded by investors for the decision, which he made because the refinery was deemed not to be viable in the current market environment.
Situated in Northern Australia, dual-listed Rio Tinto will now work on the scope and phased timing of the suspension and prepare for all potential outcomes over coming months, the company said.
Consultation with employees and the local community to minimise the impact of the change for Nhulunbuy and the region is ongoing.
Rio will continue with its bauxite operations at the plant and is keen to establish a long-term plan for the production of bauxite with the help of its employees.
Walsh said: ""This is a very sad day for everyone associated with Gove. It has been extremely difficult decision and we recognise it will have a significant impact on our employees, the local community and the Northern Territory.
""There is no doubt it is a challenging path ahead. We are working in partnership with the Northern Territory and Australian governments, the broader community and traditional owners to identify initiatives to create new opportunities for the people of Nhulunbuy. We have a firm belief in the potential of the bauxite operation, a quality asset with a long-term future.""
Walsh was appointed CEO of Rio Tinto in January this year and a main focus has been reducing capex and speculative spending projects.
On the flipside, yesterday Rio announced it was ramping up production at its iron ore business in Western Australia and expected to produce at a significantly lower cost than forecast.
The mining major's shares also rose on this news, showing investors have confidence in Walsh's vision for the company."
Chief executive Sam Walsh was applauded by investors for the decision, which he made because the refinery was deemed not to be viable in the current market environment.
Situated in Northern Australia, dual-listed Rio Tinto will now work on the scope and phased timing of the suspension and prepare for all potential outcomes over coming months, the company said.
Consultation with employees and the local community to minimise the impact of the change for Nhulunbuy and the region is ongoing.
Rio will continue with its bauxite operations at the plant and is keen to establish a long-term plan for the production of bauxite with the help of its employees.
Walsh said: ""This is a very sad day for everyone associated with Gove. It has been extremely difficult decision and we recognise it will have a significant impact on our employees, the local community and the Northern Territory.
""There is no doubt it is a challenging path ahead. We are working in partnership with the Northern Territory and Australian governments, the broader community and traditional owners to identify initiatives to create new opportunities for the people of Nhulunbuy. We have a firm belief in the potential of the bauxite operation, a quality asset with a long-term future.""
Walsh was appointed CEO of Rio Tinto in January this year and a main focus has been reducing capex and speculative spending projects.
On the flipside, yesterday Rio announced it was ramping up production at its iron ore business in Western Australia and expected to produce at a significantly lower cost than forecast.
The mining major's shares also rose on this news, showing investors have confidence in Walsh's vision for the company."
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