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October 07, 2008


Rio Tinto unveils 5 drivers for exceptional growth

Mr Tom Albanese CEO of Rio Tinto and some of his senior management team at its investor seminar unveiled its strategy and growth plans in great details.

As per pre conference release, 5 key value drivers were outlined

1. An exceptional growth strategy in iron ore and a strong pricing outlook, with a conceptual pathway to treble production to over 600 million tonne per annum.

2. Positioned as the world's leading aluminum and bauxite producer with an excellent portfolio of growth projects and a strong market outlook. Anticipated post tax synergies resulting from the Alcan integration have been increased by more than 50% from USD 600 million to USD 940 million per annum.

3. As one of the world's leading copper businesses Rio Tinto has an impressive pipeline of exciting projects with interests in many of the world's largest undeveloped mineralization opportunities. Recent exploration at the La Granja project in Peru has highlighted the potential for doubling forecast production to in excess of 500,000 tonne per annum.

4. An increase in the divestment target from at least USD 10 billion to at least USD 15 billion following a strategic review.

5. A capital management strategy focused on enhancing shareholder returns from cash flow while providing flexibility for ongoing growth. The total 2007 dividend will be increased by 30% with a further annual total increase of no less than 20% in each of the following two years. This reflects the Board's confidence in the business.

Mr Tom Albanese said that "The rise in global mineral demand is a trend that we expect to continue for decades because of fundamental demographic and economic shifts, especially in developing economies like China and India. We believe that the value in Rio Tinto is yet to be fully reflected by the market. We believe we have a better growth pipeline than our competitors, which puts Rio Tinto in a strong position to supply the metal hungry world. We have the people, execution capability and resources to work smarter, faster and better than our competitors. We also believe our track record of delivery is unrivalled and we look forward with confidence to a hugely exciting future."