Rio Tinto and Chinalco, China's largest alumina producer, on Friday signed a memorandum of understanding to set up a joint venture to explore resources in China, the Anglo-Australian mining giant said.
The venture, in which Chinalco will hold a 51-per-cent stake while Rio will take the remaining 49 per cent, will "explore mainland China for world-class mineral deposits," Rio said in a statement. "The combination of skills provided by Rio Tinto and Chinalco offers great potential to unlock value for mutual benefit," the statement quoted Rio chief executive Tom Albanese as saying.
The joint venture, expected to come into operation in the first half of 2011, will start with three to five large exploration projects and potentially move to additional regions later on. Rio will appoint the chief executive of the new venture, with the chairman of the five-member board nominated by Chinalco, according to the statement.
"To build on our respective strengths and establish an exploration joint venture is a win-win measure that will deepen our cooperation and meet the challenges of the market," Chinalco president Xiong Weiping said.
Chinalco is seeking to diversify from aluminum into other sectors such as coal, iron ore, rare earths and copper, to become a global mining firm.
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