Rio Tinto Plc · LSE:RIO
Rio Tinto — Investor Day (October 2021)
91 slides from Rio Tinto's investor day presentation, Oct 20, 2021
Slide 1: Investor Seminar
Investor Seminar Performance, strategic direction and shareholder returns 20 October 2021 Gobi desert, Mongolia
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 Tinto”). By accessing/attending this presentation you acknowledge that you have read and understood the following statement. Forward-looking stateme
Slide 3: Agenda
Agenda BST AEDT Topic Presenter 08:00 - 08.15 18:00 - 18.15 Strategy and execution Jakob Stausholm, Chief Executive Mark Davies, Chief Technical Officer Panel James Martin, Chief People Officer 08:15 - 08:40 18:15 - 18:40 Culture and People: Becoming best operator Kellie Parker, Chief Executive, Aus
Slide 4: Jakob Stausholm: Strategy and execution
Jakob Stausholm Strategy and execution Rainbow Bridge. Tokyo, Japan
Slide 5: Outstanding financials but operational improvement needed
Outstanding financials but operational improvement needed Return on Capital Employed Copper equivalent production* Million tonnes 50% 5.2 5.1 5.1 4.9 27% 24% 19% 2018 2019 2020 H121 2018 2019 2020 H121 annualised *Excludes divested assets ©2021, Rio Tinto, All Rights Reserved 5
Slide 6: The team
The team Bold Alf Peter Mark Baatar, Barrios Cunningham Davies Chief Executive Chief Commercial Chief Financial Chief Technical Officer Rio Tinto Copper Officer Officer Sinead James Kellie Arnaud Kaufman Martin Parker Soirat Chief Executive Chief People Chief Executive Chief Operating Rio Tinto Mine
Slide 7: Four areas of immediate focus
Four areas of immediate focus Our Values Best Impeccable ESG Excel in operator credentials development Care for − People’s safety Expand capability Strengthen track Deliver organic & − Communities and leadership record and inorganic growth − Planet transparency Courage to Social Licence − Try new th
Slide 8: The world faces a major challenge
The world faces a major challenge Annual global GHG emissions* Limited action so far. The world has more than doubled cumulative GHG emissions 70 Gt CO2e since the early ’90’s 60 NDCs** +1.3% p.a. Momentum changing. Countries 50 ~7% p.a. are setting ambitious targets reduction and enacting policies
Slide 9: A large carbon footprint today
A large carbon footprint today Global commodity Global CO2 emissions Production CO2 intensity value chain carbon emissions and Copper* 86 Mt 21 Mt 4 tCO2/t intensities Aluminium* ~1.0 Gt 66 Mt 15 tCO2/t Crude Steel ~3.3 Gt 1,850 Mt 1.8 tCO2/t Our 2020 Scope 1 Iron Ore Our 2020 Scope 3 IOC iron ore a
Slide 10: All our commodities are vital – today, towards 2050 and beyond
All our commodities are vital – today, towards 2050 and beyond Ongoing population growth Al B Cu and urbanisation provides Aluminium Boron Copper base demand for metals 13 5 29 Additional demand for all our Fe Li Ti products from decarbonisation Iron Lithium Titanium and global energy transition 26
Slide 11: Delivering our strategy
Delivering our strategy 50% reduction in our emissions Accelerate R&D Ambition to double investment by 2030 and beyond in growth New targets for our Scope 1 & 2 emissions - Advantaged renewables position Growth to 2030 (multiple of current size)** (Mt CO2e equity basis) 10 5.5 3.8 1.5 - Accelerate R
Slide 12: Well placed to deliver
Well placed to deliver We operate in three out of the eleven advantageous regions for Advantaged positions renewable energy Large power producer and consumer. Uniquely positioned in advantaged green energy Ideal for wind Ideal for solar Ideal for solar and wind Existing major hydropower RES* endowed
Slide 13: Vivek Tulpule: Decarbonisation: Impact on commodity markets
Vivek Tulpule Decarbonisation: Impact on commodity markets
Slide 14: Transitioning towards net zero emissions
Transitioning towards net zero emissions Low-carbon policies Electrification Renewables Power storage Hydrogen Net zero by 20501 2.5x electrification growth Renewable energy from Battery capacity additions A critical part of the fuel from now to 2050 in net 10% to 70% of energy for electric vehicles
Slide 15: All our commodities are vital – today, towards 2050 and beyond
All our commodities are vital – today, towards 2050 and beyond Green aluminium lowers Al B Cu carbon input Aluminium Boron Copper 13 5 29 Green steel supporting low- carbon urbanisation Fe Li Ti Iron Lithium Titanium Copper supports rapid 26 3 22 renewable electrification Lithium is an essential bat
Slide 16: China is targeting peak emissions by 2030
China is targeting peak emissions by 2030 Electricity: power tariff for aluminium smelters and coking plants to increase by Aluminium: 27% capacity at risk RMB 300/MWh to RMB 611/MWh Steel: 10% production affected Aluminium: 6% capacity start Aluminium: 4% curtailed since Feb curtailment since Septe
Slide 17: Competitive advantage for low-carbon smelters
Competitive advantage for low-carbon smelters Aluminium smelter all-in cash costs 60% of world’s aluminium production in 2020 (Real US$2021 per tonne) powered by coal Hydro Coal Carbon costs 3,370 China accounted for ~75% of capacity Power costs growth over 2010-20 Other costs 2,630 1490 Carbon inte
Slide 18: Green steel structures can reduce emissions
Green steel structures can reduce emissions Total carbon emissions Steel intensity Building construction is Kg per m2 (China) Kg per m2 (China) responsible for about 30% of New seismic China’s carbon emissions 400 120 building code with reinforced- concrete-structure New China building code will 100
Slide 19: Decarbonisation is a big driver of copper demand
Decarbonisation is a big driver of copper demand Net additional demand* in a net zero carbon scenario Additional green demand expected to account for over one Mt quarter of total demand in the net 20 zero carbon scenario EVs Rapid electrification of grid adds 15 Renewable power ~5Mt in copper demand
Slide 20: Significant supply gap emerging for lithium
Significant supply gap emerging for lithium Lithium demand and supply in net zero carbon scenario By 2030, electric vehicles will account (Multiple of 2020 demand levels, Lithium Carbonate Equivalent) for up to 55% of annual light vehicle Committed sales Spodumene 15x Committed Lithium is the prefer
Slide 21: Energy and industrial transition drives demand for our products
Energy and industrial transition drives demand for our products Limiting the impact of climate Al B Cu change requires a green Aluminium Boron Copper revolution 13 5 29 This social-industrial change Fe Li Ti will profoundly shift the energy Iron Lithium Titanium and industrial landscape 26 3 22 Gree
Slide 22: Mark Davies: Decarbonising our own business and the impact of green steel
Mark Davies Decarbonising our own business and the impact of green steel ISAL Aluminium smelter, Iceland
Slide 23: Our Scope 1 & 2 carbon footprint today
Our Scope 1 & 2 carbon footprint today Electricity Process (purchased and generated) Anodes and reductants heat Diesel 2020 equity basis 8.5 Mt CO2e 6.0 2.2 31.5 Mt CO2e Mt Mt CO2e 4.4 Mt CO2e CO2e Aluminium Bauxite & Alumina Minerals Iron ore Copper Other % of total 45% 25% 18% 12% ©2021, Rio Tinto
Slide 24: Taking actions to address our emissions
Taking actions to address our emissions Electricity Anodes & Reductants Offsets Growing renewables from 75%1 Developing technologies − Gudai-Darri (34MW), QMM (20MW) and Weipa (4MW) − Construction of first Building capacity − Large scale (1GW) Pilbara renewables ELYSISTM commercial- scale cell at Al
Slide 25: Raising our decarbonisation target from 15% to 50% by 2030
Raising our decarbonisation target from 15% to 50% by 2030 Our Scope 1 & 2 emissions (Mt CO2e equity basis) Accelerate delivery of existing 15% emissions reduction target 35 to 2025 30 32.6 2030 target from 15% to 50% 25 -50% reduction 20 Increase decarbonisation 15 investment of our own assets 16.3
Slide 26: Switching the Pilbara to renewables
Switching the Pilbara to renewables Rapid deployment of ~1GW MW installed solar and wind renewables, To replace gas power Fully displace diesel in rail renewables and early electrification and mobile fleet supported by storage 3000 Natural gas repowering Abates ~1Mt CO2 Scope 1 Diesel repowering emi
Slide 27: Progressing renewable power options for Australian smelters
Progressing renewable power options for Australian smelters Power Catalyst for regional renewable Assets in coal-based grids Ownership (100% basis) Contract expiry energy deployment and development of industry Tomago 960MW Signed Statement of 51.6% 2028 smelter (demand) Cooperation with Queensland G
Slide 28: Accelerating current abatement projects
Accelerating current abatement projects Our Marginal Abatement Cost Curve for Scope 1 & 2 emissions (excl. Pilbara and Pacific Operations repowering, ELYSISTM, energy efficiency and carbon offsets) USD/tCO2 300 250 Renewables 200 Mobile diesel 150 Process heat Anodes & reductants 100 50 0 0.0 0.5 1.
Slide 29: Developing green products for our customers
Developing green products for our customers Scope 3 goals 1 Technology for reductions in steelmaking carbon intensity of at 519 519 least 30% from 2030 Mt CO2e Mt CO2e 2 Breakthrough technologies to deliver carbon neutral steelmaking pathways by 2050 3 Anticipate that ELYSISTM technology By source M
Slide 30: A shift to greener steelmaking technologies
A shift to greener steelmaking technologies Short-term / partial decarbonisation Medium / Long-term / net-zero potential New technologies Our areas of focus Lump / pellet BF Hydrogen (H2) Biomass BF / high-grade optimisation Direct Smelting injection pig iron1 BOF iron ore + CCUS New iron and steelm
Slide 31: Our focus areas for iron and steel decarbonisation
Our focus areas for iron and steel decarbonisation Future pathways for Pilbara iron ore 1 2 3 4 5 6 Blast furnace Pilbara Low-carbon H2 DRI Simandou H2 DRI optimisation beneficiation research project and melter Canada Multiple CSIRO / Pilbara Pilbara High-quality Project – projects Universities path
Slide 32: Alf Barrios: Commercial opportunities from decarbonisation
Alf Barrios Commercial opportunities from decarbonisation Amrun, Queensland
Slide 33: Sustainable future across the value chain
Sustainable future across the value chain Leveraging insights across Partnering with our suppliers and the value chain 1 developing sustainable supply chains Assets Working together with our customers Customers 2 to provide products & services for a more sustainable future Suppliers Innovating with
Slide 34: Partnering with suppliers and developing sustainable supply chains
Partnering with suppliers and developing sustainable supply chains Driving innovation through supplier partnerships Accelerating shipping decarbonisation − Collaborating on a mining decarbonisation pathway − Reduced emissions intensity1 >30% by end 2021, vs IMO target of 40% by 2030 − 2025 Piloting
Slide 35: Working with customers to meet societal demands
Working with customers to meet societal demands Government policy and markets responding to end-user demand ESG transparency through START − Transparency and traceability from mine to market − Secure platform, built on blockchain − Enabling consumers to make ESG-informed decisions, beyond carbon ©20
Slide 36: Solutions for a more sustainable future
Solutions for a more sustainable future Products for a greener world Circular solutions to reduce emissions − Aluminium alloys for giga-casting in electric − Partnering with ABInbev to reduce emissions from packaging vehicle manufacturing − Multi-product collaboration with Schneider Electric for − C
Slide 37: Simon Trott: Iron Ore
Simon Trott Iron Ore
Slide 38: Pilbara Iron Ore set for even stronger performance
Pilbara Iron Ore set for even stronger performance 1999 - 2013 2014 - 2021 2021+ New mines China expansion Consolidation Refocus our future Key infrastructure and automation 14 new growth mines since 1999 >$50bn free cash flow Build on outstanding financial Shipments (Mt, 100%) Port expansion toward
Slide 39: Raising our system capacity
Raising our system capacity Estimated Prior best performance Capacity System capacity will be delivered by: Max month* Max quarter* Max annual Mid term** - Rio Tinto Safe Production System driving Mt Mt Mt Mt improved productivity - Improved interface efficiencies across mine, Mine 370 349 338 345-3
Slide 40: Mine productivity to mitigate higher work index
Mine productivity to mitigate higher work index The work index of our mining operations is increasing Material movement (Bt) Effective flat haul* (km) Work index (Bt.km) Below water table mining (%) 1.2 1.4 x 11 14 15 = 17 21 + 36% 42% 33% 1.0 12 2018 2021F 2024F 2018 2021F 2024F 2018 2021F 2024F 20
Slide 41: Adjusting our operating practices to protect heritage
Adjusting our operating practices to protect heritage Heritage site example Responding to new information C New Haul Route Heritage site B A Removed from mine plan Shortest Route A. 70 metre exclusion zone | B. 200 metre blast management zone | C. 350 metre blast management zone ©2021, Rio Tinto, Al
Slide 42: Improving plant performance
Improving plant performance Maintenance impacted by labour Increased planned Stabilising and addressing constraints shutdowns maintenance backlog Hours, Index 2019 = 100 Hours, Index 2019 = 100 Outstanding hours, Index 2019 = 100 100 98 80 114 117 120 100 100 97 2019 2020 2021 2019 2020 2021 2019 20
Slide 43: Maximising productivity from port and rail
Maximising productivity from port and rail Rail performance Port productivity Focus on asset health, including ballast and turnout replacement Our ports are our competitive advantage AutoHaul delivering operational and safety improvements: Focus areas: - Reduction in driver change-over delays from 9
Slide 44: How we are improving our business
How we are improving our business Operational Readiness Rio Tinto Safe Production System Commission and ramp Reduce wait for Reduce materials Reduce fixed plant Improve rail capacity Focus area up new assets feed at the crusher handling losses unscheduled loss and resilience Gudai-Darri Dewatering F
Slide 45: Operating and sustaining capital cost outlook
Operating and sustaining capital cost outlook Outlook for 2022 Investing in our assets 2021 cost guidance of $18-18.5/t Key focus areas: Cost pressures continue: - Asset reliability - Work index increase of 12% (from 2021 forecast) - Plant and rail asset health - Continued investment in asset health
Slide 46: Mine project pipeline
Mine project pipeline Capital Intensity Completed projects High volume of environmental approvals ($/t Real 2021) Projects in development Projects in study stage for new mines $150 $130 $110 $90 GD1 Western Range $70 BS1 $50 Robe Valley Sustaining BHT/HD2 $30 West Angelas WTS2 Deposits $10 C&D -$10
Slide 47: Ongoing focus on quality and product mix
Ongoing focus on quality and product mix Shipments by product (%) Consistent quality remains key for our Pilbara Blend. Demand remains strong, and will continue to underpin our product strategy 45% 47% 45% 45% Pilbara Blend quality maintained by: - Blending different ore sources to tight specificati
Slide 48: Positioning Pilbara ores in a green steel world
Positioning Pilbara ores in a green steel world Working with customers to decarbonise Steel making process routes to move to ‘net neutral’ the blast furnace mostly capped at ~20-30% emission reduction Pilbara Pathway 1: Low-carbon research project Raw materials Ironmaking Steelmaking Options to more
Slide 49: Strengthening partnerships
Strengthening partnerships Traditional Owners Local Communities Western Australia Working together to build a better future Supporting thriving communities through Building local capacity - using local suppliers through employment, business and caring economic development and employment: to build ra
Slide 50: Becoming the most valued resource business
Becoming the most valued resource business Best Impeccable Excel in operator ESG credentials development Transform our safe Position Pilbara Deliver new mines operating performance for green steel of the future Empower our workforce Decarbonise the Pilbara Optimise Pilbara capacity, through Rio Tint
Slide 51: Ivan Vella: Aluminium
Ivan Vella Aluminium
Slide 52: Over a hundred years of aluminium expertise
Over a hundred years of aluminium expertise 1950 1965 1980-90 2014 Engineering Technological Partnership excellence expertise and innovation ©2021, Rio Tinto, All Rights Reserved 52
Slide 53: A structurally advantaged integrated business
A structurally advantaged integrated business Bauxite Alumina Energy Aluminium 4 bauxite mines 4 alumina refineries 7 hydro plants 14 aluminium smelters, 80% renewables 56.1Mt* 8.0Mt* 4.1GW 3.1Mt* Australia, Brazil Australia, Brazil Supporting our and Guinea and Canada assets in Canada Australia, Ca
Slide 54: The most profitable integrated Aluminium business
The most profitable integrated Aluminium business Historic supply growth created Integrated Upstream1 Integrated EBITDA challenging conditions EBITDA Margin Margin & ROCE (%) Mt (%) 64 64 63 65 59 40 EBITDA 40% 57 36% Margin H1 2021 37% 36% 5.1% 54 34% 50 35% 48 30% 46 30 30% 42 40 38 38 24% 25% 20%
Slide 55: Proven operational resilience
Proven operational resilience Global All Injury Frequency Rate Pot Productivity* Asset Utilization rate Tonnes per operating pot per day Casthouse* 0.5 1.8 71 1.6 70 0.4 1.4 69 1.2 0.3 1.0 68 0.8 67 0.2 0.6 66 0.4 0.1 65 0.2 0 0.0 64 2017 2018 2019 2020 2021 2017 2018 2019 2020 2021 2017 2018 2019 2
Slide 56: Continuing to improve our business
Continuing to improve our business 1st decile hydro-powered smelters* 1st quartile bauxite mines Automating our casting process leveraging R&D ~1% 1,138 1,175 1,137 1,127 1,113 1,116 1,104 1,106 1,094 1,078 2013 2014 2015 2016 2017 2018 2019 2020 2021** Production creep Positioned for low CO2 metal
Slide 57: Potential for positive structural change in the market from energy and smelting caps in China
Potential for positive structural change in the market from energy and smelting caps in China Aluminium supply by source (global) Primary Aluminium supply (China) Mt Mt 91 92 91 90 China Primary Aluminium Supply, Mt Weeks of consumption 85 82 40 9 4.8% 75 78 36 36 35 37 71 35 8 67 32 31 61 CAGR: 30
Slide 58: New coal-powered smelting likely to be challenged
New coal-powered smelting likely to be challenged Total metal required* Aluminium smelter all-in cash costs Mt (Real US$2021 per tonne) 3.3% Hydro Coal Carbon costs 122 3,370 111 Power costs 43 CAGR: Other costs 5.5% 2,630 88 36 1490 750 25 1,650 1,420 1,520 770 770 1,190 100 200 700 290 290 79 CAGR
Slide 59: Switching our Australian smelters to renewables
Switching our Australian smelters to renewables Smelting requires uninterrupted energy, …but regions with high-quality renewables increasing the technical difficulty and a coordinated approach can create of a transition without hydro-power… value in the transition Typical energy requirements for lar
Slide 60: Decarbonising the aluminium supply chain
Decarbonising the aluminium supply chain Already lowest CO2 emissions Hydrogen calcination Commercialising ELYSISTM 18 16 14 12 10 8 6 4 2 0 RoW Global Peer A Peer B Peer C Peer D Peer E China Peer G Peer H Rio Tinto Atlantic PeerF Rio Tinto Pacific 2021 - Total emission tCO2/t Green hydrogen a subs
Slide 61: Green materials need to be more than carbon free
Green materials need to be more than carbon free Carbon free Responsible Traceable Circular Zero carbon through Produced with respect and Materials identifiable and Recyclable material that the full lifecycle care for host communities, traceable throughout retain its properties of production partner
Slide 62: Strengthening our social licence
Strengthening our social licence First nations Vaudreuil Turning waste into and communities filter press valuable resources Mutual Respect Agreement with Reduce red mud waste volume Treatment technology developed by RTA Mashteuiatsh for 20 years Eliminate slurry pond storage Treat spent pot lining o
Slide 63: Opportunities to leverage our attractive foundation
Opportunities to leverage our attractive foundation Tier 1 bauxite resource with options to expand and improve cost position Deep technical and processing expertise Growing smelting capacity requires more green power Working with customers to meet their specific needs Improve capital intensity of fu
Slide 64: Positioned to thrive in a low-carbon environment
Positioned to thrive in a low-carbon environment Strong foundation Clear strategy Attractive future - Integrated business with Tier 1 assets - Accelerate zero carbon, zero waste - Potential structural change in the market - Advantageous renewables position - Empowering our people to be the Best - EL
Slide 65: Peter Cunningham: Performance, investment and shareholder returns
Peter Cunningham Performance, investment and shareholder returns The Saguenay, Canada
Slide 66: We are in very robust financial health
We are in very robust financial health ROCE (post-tax) – outperforming our peers Attractive cash flows Strong balance sheet $bn 26.6 Net debt (cash) $bn 30% 14.1 19.4 11.3 15.9 10.0 14.9 9.3 9.3 19% 13.9 8.0 11.8 15% 9.5 9.2 9.4 5.6 11% 8.5 4.8 7.0 4.9 5.8 1.6 0% Jun-16 Dec-16 Jun-17 Dec-17 Jun-18 D
Slide 67: Actions in place to improve our performance
Actions in place to improve our performance Copper equivalent production for the nine months to September* Operating performance not Million tonnes where we want it to be Rigorous performance 3.9 3.8 3.8 management 3.6 Deploying Rio Tinto Safe Production System Building capability across the organis
Slide 68: Disciplined allocation of capital remains at our core
Disciplined allocation of capital remains at our core Essential capex 1 Integrity, Replacement, Decarbonisation Further cash Compelling returns to growth shareholders Ordinary 2 dividends Debt management Iterative 3 cycle of ©2021, Rio Tinto, All Rights Reserved 68
Slide 69: Maintaining our rigorous approach to investments
Maintaining our rigorous approach to investments Controlled risk taking allows for more Final decision Commodities which enable opportunities Board the energy transition Investment Decarbonisation Using a range of criteria across themes different investment opportunities Integrity Independent Invest
Slide 70: Reinvesting for growth and decarbonisation
Reinvesting for growth and decarbonisation Capital expenditure profile Sustaining capital of ~$3.5bn per year $bn including Pilbara Iron Ore of ~$1.5bn ~9.0-10.0 ~9.0-10.0 ~$0.5bn per year to decarbonise our assets from 2022 to 2024 ~8.0 ~7.5 Total decarbonisation investment of ~$7.5bn* from 2022 to
Slide 71: Broad-based funding model for decarbonisation
Broad-based funding model for decarbonisation Capital expenditure Pilbara energy system | ELYSISTM ~$7.5bn over 2022-30 implementation capital | MACC projects Operating expenditure New capability | Energy efficiency | R&D Operating expenditure Pacific Aluminium smelters and refineries Long-term cont
Slide 72: Attractive dividends remain paramount
Attractive dividends remain paramount Shareholder returns of 40-60% of underlying earnings on average through the cycle Consistent five-year record of Pay-out ratio (%) shareholder returns 100 Pay-out ratio policy de-risks the company 80 60% average pay-out on ordinary dividend over past 5 years 60
Slide 73: Strong foundation for growth, decarbonisation and shareholder returns
Strong foundation for growth, decarbonisation and shareholder returns Compelling investment Outstanding foundation Clear strategy proposition - No fossil fuel extraction - Accelerate our own decarbonisation - Deliver value-adding growth - Long-life assets producing vital commodities - Grow in materi
Slide 74: Appendices
Appendices Jadar project, Loznica, Serbia
Slide 75: Shareholder structure
Shareholder structure 23% Rio Tinto Limited Shares outstanding: 0.371bn 77% Rio Tinto PLC Shares outstanding: 1.247bn 100% Rio Tinto DLC Shares outstanding: 1.619bn 1.1 0.3 0.4 0.5 5.7 13.9 17.5 14.8 18.8 35.9 7.1 29.5 59.2 28.9 31.9 8.2 14.1 12.5 Australia UK Europe (ex UK) North America Asia ROW *
Slide 76: Debt maturity profile
Debt maturity profile 30 June 2021 debt maturity profile* $ million Average outstanding debt maturity of 2,000 corporate bonds at ~12 years (~ 9 years for Group debt) 1,800 1,600 No corporate bond maturities until 2024 1,400 1,200 Liquidity remains strong under 1,000 stress tests 800 600 $7.5bn back
Slide 77: Group level financial guidance
Group level financial guidance FY2021 FY2022 FY2023 FY2024 CAPEX Total Group ~$7.5bn ~$8.0bn ~$9.0 – 10.0bn ~$9.0 – 10.0bn Sustaining Capex ~$3.5bn ~$3.5bn ~$3.5bn ~$3.5bn Group Pilbara Sustaining ~$1.5bn ~$1.5bn ~$1.5bn ~$1.5bn Capex • $0.5bn per year to decarbonise our assets from 2022 to 2024 • T
Slide 78: Product group level guidance
Product group level guidance 2021 production 2021 costs guidance1 Iron Ore 320 – 325mt2 $18.0-18.5/wmt (FOB), based on an Shipments (100% basis) Australian dollar exchange rate of $0.75 Copper Mined Copper ~500kt3 C1 Copper unit costs 75-80 US c/lb Refined Copper 190 – 210kt4 Aluminium Bauxite 54 –
Slide 79: Modelling EBITDA
Modelling EBITDA Underlying EBITDA sensitivity Average published price/exchange US$ million impact on full year 2021 underlying rate for 2021 first half EBITDA of a 10% change in prices/exchange rates Copper 413c/lb 478 Aluminium $2,245/t 784 Gold $1,805/oz 77 Iron ore realised price $168.4/dmt 4,18
Slide 80: Modelling aluminium costs
Modelling aluminium costs Canadian* smelting unit cash** cost sensitivity ($/t) Impact a $100/t change in each of the input costs below will have on our H1 2021 Canadian smelting unit cash cost of $1,262/t Alumina (FOB) $191 Green petroleum coke (FOB) $27 Calcined petroleum coke (FOB) $36 Coal tar p
Slide 81: Jadar project – 100% owned and managed
Jadar project – 100% owned and managed Mining and processing Serbian tax and royalties Underground mine using bench stoping First quartile costs Mining royalty: 5% (levied on gross Co-located beneficiation and chemical processing plant sales minus allowable deductions) Primary products: lithium carb
Slide 82: RTA Value Chain – 2020 Actuals
RTA Value Chain – 2020 Actuals Mining Refining Aluminium Casting Bauxite Alumina 56.1 dmt 30% 8.0mt 80% Aluminium Casthouse RTA 3.2mt 100% Prodn Intersegment 70% 20% 43% 57% 3rd Party Sales Bauxite Alumina VAP Non-VAP 39.4 dmt 1.6mt ©2021, Rio Tinto, All Rights Reserved 82
Slide 83: Common acronyms
Common acronyms T = Tonne ROCE = Return on capital employed Mt = Million tonnes EBITDA = Earnings Before Interest, Taxes, Depreciation and Amortisation Gt = Giga tonnes CAGR = Compound annual growth rate tCO2 = Tonne of carbon dioxide USD = United States dollar tCO2 e = Tonne of carbon dioxide equiv
Slide 84: Increasing transparency for our stakeholders
Increasing transparency for our stakeholders A commitment to reporting on: Ongoing progress against How Traditional Owners’ our own commitments and views are being sought and internal work-streams considered in shaping these external obligations and commitments and Traditional recommendations. Owner
Slide 85: Working to improve in multiple areas
Working to improve in multiple areas 1 Remedying and rebuilding our relationship with the PKKP people 2 Partnering with Pilbara Traditional Owners in modernising and improving agreements 3 Establishing the new Communities and Social Performance model 4 Building local capability and capacity to suppo
Slide 86: Establishing an Australian Advisory Group
Establishing an Australian Advisory Group (previously called Indigenous Advisory Group) Specific We are establishing an Australian Advisory Group (AAG) to help shape, influence and support our approach to issues that are important to Indigenous peoples, the actions Australian community and our busin
Slide 87: Reducing barriers to and increasing Indigenous employment
Reducing barriers to and increasing Indigenous employment We have: Specific actions Committed to a US$50 million investment to retain, attract and grow Indigenous professionals and leaders in our business Increased Indigenous leaders from 6 to 19 across Australia Increased our 2021 target to recruit
Slide 88: Establishing the new Communities and Social Performance model
Establishing the new Communities and Social Performance model Specific We have: actions Increased number of CSP professionals from 250 to 300, working in 65 sites and 35 countries Restructured reporting lines so field based CSP professionals report to their line managers Established a central CSP Ar
Slide 89: Partnering with Pilbara Traditional Owners in modernising and improving agreements
Partnering with Pilbara Traditional Owners in modernising and improving agreements Specific Preliminary discussions with ten Pilbara Traditional Owner groups in relation to agreement moderisation actions Identified key principles for consideration in modernising agreements Signed engagement protocol
Slide 90: Building local capability and capacity to support the site General Manager
Building local capability and capacity to support the site General Manager Iron Ore Chief Executive has the overall accountability for Specific Traditional Owner relationships and heritage matters for the product actions group Site General Managers have direct responsibility for TO relationships Tra
Slide 91: Establishing a process to redefine and improve cultural heritage management standards
Establishing a process to redefine and improve cultural heritage management standards We are increasing both the capabilities and resources of the internal Specific Cultural Heritage teams to increase understanding and delivery of actions cultural heritage performance. Rio Tinto Iron Ore has almost