Rio back on asset sale track with uranium mine sale

11 July 2008

Mumbai: Rio Tinto's $15 billion (A$15.63 billion) asset sale proposal seems to be back on track with the sale of the undeveloped Kintyre uranium project in Western Australia to Cameco of Canada and Mitsubishi of Japan for $495 million ($A515 million).

The deal also gives aboriginal landowners the right to secure equity involvement in development of the Kintyre uranium deposit after its sale.

Kintyre is one of the world's biggest undeveloped uranium deposits (80 million pounds of uranium now worth $4.8 billion in its finished form) but its development has been held up by the governments continuing ban on uranium mine developments.

But the aboriginal Martu tribe, the traditional landowners of the mineral belt, will join the new owners to pressure the Labor government to lift the ban.

The sale came five months after Rio Tinto sold interests in two North American mines as part of its plan to pay down its debt.

Rio is also believed to have entered a more advanced stage of a bid to divest its US energy coal business for about $4-5 billion.