Rio Tinto Plc · LSE:RIO
Rio Tinto — Investor Day (December 2023)
21 slides from Rio Tinto's investor day presentation, December 2023
Slide 1: Investor Seminar 2023
Investor Seminar 2023
Slide 2: Cautionary and supporting statements
Cautionary and supporting statements This presentation has been prepared by Rio Tinto plc and Rio Tinto Limited (together with their subsidiaries, “Rio statements should, therefore, be construed in light of such risk factors and undue reliance should not be placed on Tinto”). By accessing/attending
Slide 3: Cautionary and supporting statements (cont.)
Cautionary and supporting statements (cont.) Oyu Tolgoi - Production Targets Resources. The Competent Person responsible for the information in the 2022 Annual Report that relates to La The 500ktpa copper production target (stated as recoverable metal) for the Oyu Tolgoi underground and open pit Gra
Slide 4: Cautionary and supporting statements (cont.)
Cautionary and supporting statements (cont.) Simandou - Mineral Resources and Ore Reserves Mineral Resources and Ore Reserves – Global Iron Ore portfolio Simandou Mineral Resources and Ore Reserves reference on slides 74 and 98 have been reported in Rio Tinto’s Iron Ore Mineral Resources and Ore Res
Slide 5: Simandou
Simandou Bold Baatar Mark Davies ©2023, Rio Tinto, All Rights Reserved 5
Slide 6: Unlocking the world's largest known high-grade iron ore resource
Unlocking1 the world’s largest known high-grade iron ore resource A financially attractive, Tier 1 resource: IRR2 in low double digits anticipated for Simfer mine and combined infrastructure through ownership of Compagnie du TransGuinéen (CTG) Diversification of iron ore portfolio – complements our
Slide 7: Simandou complements our Pilbara and IOC portfolio
Simandou complements our Pilbara and IOC1 portfolio Unrivalled global portfolio Strategic differentiators High quality Ore Reserves Global Mineral Resources & Ore Reserves5 Billions of dry tonnes, published grades World class infrastructure IOC1 Ore Reserves 20Mt 2 2 1 Portside ~24Mt3 Joint Venture
Slide 8: Three dimensions to the Simandou project
Three dimensions to the Simandou project 01 02 03 Compagnie du TransGuinéen Simfer Mine WCS Mine (CTG) Infrastructure1 – blocks 3 & 4 – blocks 1 & 2 Funded: Funded: Funded: 50% by Simfer InfraCo (53% Rio Tinto, 53% by Rio Tinto 51% Winning Consortium3 47% CIOH Consortium2) 47% by CIOH Consortium2 49
Slide 9: Simfer's project scope
Simfer’s project scope Simfer will construct a 60Mtpa mine1, rail spur and transhipment vessel (TSV) port, and will own an equal share of CTG with WCS on completion Mine 60Mtpa with expansion options – Guinea average grade of 65.3% Fe - 26-year mine life2 Main Rail Line WCS built rail Port – TSVs3 (
Slide 10: Construction progress: enabling works underway
Construction progress: enabling works underway Scopes of work to support contractor mobilisation and construction are progressing Accommodation availability and site facilities have been the focus across Q3 and Q4 2023 Stockyard dam to provide water for Tin Dijou camp building Camp strategy involves
Slide 11: Simfer capital expenditure summary
Simfer capital expenditure summary Final Rio Tinto Board approval is subject to the remaining conditions being met, including joint venture partner and regulatory approvals from China and Guinea1 Simfer capex Rio Tinto share Mine and TSVs, owned and operated by Simfer: Development of an initial 60Mt
Slide 12: Commitment to globally recognised ESG standards and best practices
Commitment to globally recognised ESG standards and best practices Key Risks Key Opportunities Health and safety Regional economic development Biodiversity Economic contribution Project-induced migration Job creation Resettlement and land access Co-development model Human Rights Climate change resil
Slide 13: Capital allocation and financials
Capital allocation and financials Peter Cunningham 13
Slide 14: Focus on operational performance uplift and consistently strong cash flows
Focus on operational performance uplift and consistently strong cash flows Operating cash flow 1 ($bn) Production growth CuEq2 (Rio Tinto share) 8% 25 6% 7% 5% 5% 4% 4% 4% 4% 16 16 2% 15 2% 1% 0% 12 0% -2% -1% -1% -4% -4% -6% -6% -8% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4E 2018 2019 2020 20
Slide 15: Operating cash flow includes investment for creating growth options
Operating cash flow includes investment for creating growth options and strengthening social licence $bn • Expenditure rising in line with development of project portfolio 1.9 • Fully expensed via the P&L 1.6 0.5 • Includes $250m per year of central 1.3 0.4 greenfield exploration 1.2 0.4 0.3 0.4 0.3
Slide 16: Consistent capital allocation, balancing essential capex with shareholder returns and growth
Consistent capital allocation, balancing essential capex with shareholder returns and growth 01 Essential capex ($bn) Integrity, Replacement, Decarbonisation 02 Ordinary dividends ($bn) 60% of underlying earnings paid out 03 Iterative cycle of… in each of past 7 years1 12.8 ~7.0 ~7.0 ~7.0 6.2 ~6.0 8
Slide 17: Shaping our portfolio for the future
Shaping our portfolio for the future Growth capex1 $bn <$3bn per year Simandou Other Oyu Tolgoi Kennecott underground Simandou the key driver of growth capex 1.0 Oyu Tolgoi underground spend to wind down 0.6 from 2024 as infrastructure is completed Other includes yet to be approved copper and lithiu
Slide 18: Financial strength remains a key asset in volatile markets
Financial strength remains a key asset in volatile markets Major commodity prices (real $2023, 12-month moving average1) • Near-term demand more subdued with 180 Boom to bust Global economic recovery Brumadinho disaster Covid stimulus – increased demand and Weaker demand growth services driving GDP
Slide 19: Decarbonisation investment pathways continue to evolve
Decarbonisation investment pathways continue to evolve Decarbonisation pipeline Total capex guidance to 2030 (Mt CO2e, equity basis) revised to $5-6bn1,2 2030 CO2e 2023-2030 abatement % capex % 600 Commercial solutions ~65-70% ~10% 500 • PPAs, VPPAs, RECs • Biofuels 400 BlueSmelting™ 300 pilot Capit
Slide 20: Investment to de-risk from carbon legislation and reduce opex
Investment to de-risk from carbon legislation and reduce opex Annual average net operating costs ($m) from decarbonisation programme1 Increasing influence of carbon taxes • ~50% of our emissions are now in scope for legislated carbon penalties 3-5% IRR 10-13% IRR pre-tax, real pre-tax, real • Costs
Slide 21: Outlook underpins a strong Rio Tinto for the long term
Outlook underpins a strong Rio Tinto for the long term Total commodity demand by 2035 (<2°C scenario, CuEq)1 Total demand growth of ~4% CAGR between 2022 and 2035 with net demand uplift from Traditional and Energy Transition broadly equal Attractive long-term demand fundamentals 2035 ~1.9% Primary d