It is reported that Rio Tinto is finalizing the renegotiation of its USD 1.65 billion a year iron ore joint venture with troubled Chinese group Sinosteel.

It is part of Rio's efforts to repair its damaged relationship with Beijing. The move comes after 12 months of often difficult talks between the two parties and follows the eighth visit to China this year by Rio chief executive Mr Tom Albanese last week.

Mr Huang Tianwen Sinosteel chairman confirmed the fresh agreement during a dinner hosted by Treasurer Wayne Swan for a group of Chinese state owned enterprises with investments in Australia in Beijing.

The Channar mine located in the Pilbara region of Western Australia contains high grade, 63.5% iron ore. The first mining project between Australian and Chinese interests was inked in 1986.

Rio Tinto holds a 60% stake in the Channar joint venture and Sinosteel holds the remaining 40%.

Sinosteel original deal with Rio was to off take 200 million tonnes of ore from the mine to supply the Chinese market.

Rio declined to comment or provide any details of the new agreement.

(Sourced from www.theaustralian.com.au)