Rio Tinto says Australia investment will sustain Boyne smelter to 2040

(Alliance News) - Rio Tinto PLC on Wednesday announced a new partnership with the Queensland and Australian governments that will keep the Boyne aluminium smelter competitive until 2040.

The deal, which the company says secures a long-term future for the smelter located some 12 kilometres south of the port of Gladstone, will see Australia's state and federal governments invest a combined AUD2 billion, or GBP1.04 billion, over 10 years as part of the Future Made in Australia initiative.

The investment, which Rio Tinto says builds on previous power purchase agreements, will support the transition to long-term competitive power for the Boyne smelter and maintain manufacturing jobs in Central Queensland.

Rio Tinto believes that the partnership, along with past AUD7.5 billion investments in energy storage and solar and wind power underwritten by the company, will allow it to continue aluminium production through at least 2040. The date is well beyond the completion of the current power contract, slated to be completed in 2029.

The London and Melbourne, Australia based diversified miner has a majority stake in the owner of the Boyne smelters.

Rio Tinto Aluminium & Lithium Chief Executive Jerome Pecresse says: "This transformative partnership with the Queensland and Australian governments will ensure Boyne Smelter remains internationally competitive, strengthens the Australian aluminium sector for the future and supports the transformation and decarbonisation of the Queensland energy system."

"As fossil fuels become increasingly expensive, this investment, combined with the power purchase agreements we have already signed, positions Boyne to be among the world's first aluminium smelters underpinned by solar and wind power," he added.

Rio Tinto also said it has agreed to offtake 40% of Lightsource BP's solar and battery hybrid Lower Wonga project located near Gympie, Australia. The agreement is equivalent to 112 megawatts of alternating current of solar capacity, and about three hours of battery power from the associated storage site.

It brings the total renewable power contracted by Rio Tinto in the state of Queensland to more than 2.8 gigawatts.

Rio Tinto shares were up 0.9% to 6,537.00 on Wednesday morning in London.

By Martin Miraglia, Alliance News reporter

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