We use cookies to understand how you use our site and to improve your experience. This includes personalizing content and advertising. To learn more, click here. By continuing to use our site, you accept our use of cookies, revised Privacy Policy and Terms of Service.
You are being directed to ZacksTrade, a division of LBMZ Securities and licensed broker-dealer. ZacksTrade and Zacks.com are separate companies. The web link between the two companies is not a solicitation or offer to invest in a particular security or type of security. ZacksTrade does not endorse or adopt any particular investment strategy, any analyst opinion/rating/report or any approach to evaluating individual securities.
If you wish to go to ZacksTrade, click OK. If you do not, click Cancel.
Rio Tinto (RIO) Invests in Kennecott to Boost Copper Supply
Read MoreHide Full Article
Rio Tinto (RIO - Free Report) is investing in underground development infrastructure and strengthening its processing facilities at its Kennecott operation. This will help the company boost its copper output and capitalize on the growing demand for the metal stemming from the trend of energy transition.
Kennecott, located near Salt Lake City, UT, has been mining and processing minerals from the rich ore body of the Bingham Canyon Mine since 1903. It is currently the second-largest copper producer in the United States. The operation includes a concentrator, smelter and refinery and tailings storage facility.
RIO has approved $498 million which will be utilized toward underground development and infrastructure for the area known as the North Rim Skarn2 (“NRS”). Production from the NRS will start in 2024 and then ramp up over the next two years. Over the next decade, it is expected to deliver around 250 thousand tons of additional mined copper.
In September 2022, Rio Tinto had approved development capital of $55 million to start underground mining in the area known as the Lower Commercial Skarn (LCS) and underground production subsequently commenced in February 2023. It is expected to deliver around 30 thousand tons of additional mined copper by 2027.
Rio Tinto also plans to use battery electric vehicle (BEV) technology at its Kennecott operation. BEVs help increase the productivity of the mine and reduce emissions from operations while creating a safer and healthier workplace for employees underground.
Rio Tinto started work on a $300 million rebuild at the Kennecott smelter in May 2023, which is the largest in Kennecott’s history. An additional $120 million is being invested to upgrade the refinery tank house structure and update Kennecott’s molybdenum flotation circuit with a state-of-the-art, fully automated system.
The long-term outlook for copper remains positive as copper demand is expected to grow, driven by electric vehicles, renewable energy and infrastructure investments. However, grade decline, rising input costs, water constraints and scarcity of high-quality developmental opportunities continue to disrupt the industry's supply. This demand-supply imbalance will support copper prices in the future.
Rio Tinto has thus been working toward building its copper production abilities. The company received a 66% direct interest in the world-class Oyu Tolgoi mine following the completion of its acquisition of Turquoise Hill Resources Ltd for approximately $3.1 billion in December 2022. In March 2023, the mine started underground production which marked a significant step toward the ramp up to become one of the world’s leading copper suppliers. By 2030, Oyu Tolgoi is expected to become the fourth-largest copper mine in the world, operating in the first quartile of the copper equivalent cost curve.
Price Performance
In the past year, shares of Rio Tinto have gained 5.2% against the industry’s 3.1% decline.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Rio Tinto currently carries a Zacks Rank #3 (Hold).
The Zacks Consensus Estimate for ATI’s current-year earnings is pegged at $2.24 per share, indicating year-over-year growth of 12.6%. The company’s shares have gained around 76.3% over the past year. ATI beat the Zacks Consensus Estimate in three of the last four quarters while delivering in-line results on the other occasion. It delivered a trailing four-quarter earnings surprise of 13%, on average.
The consensus estimate for GFI’s current-year earnings has been revised 4% upward in the past 60 days. The consensus estimate for the company’s current-year earnings is presently pegged at $1.05 per share, implying year-over-year growth of 8.3%. Gold Fields’ shares have rallied roughly 49.6% in the past year.
The consensus estimate for Linde’s current-year earnings has been revised 4.4% upward in the past 60 days. LIN beat the Zacks Consensus Estimate in all four quarters, with the average earnings surprise being 6.9%. The company’s shares have gained 23.4% in the past year.
See More Zacks Research for These Tickers
Normally $25 each - click below to receive one report FREE:
Image: Bigstock
Rio Tinto (RIO) Invests in Kennecott to Boost Copper Supply
Rio Tinto (RIO - Free Report) is investing in underground development infrastructure and strengthening its processing facilities at its Kennecott operation. This will help the company boost its copper output and capitalize on the growing demand for the metal stemming from the trend of energy transition.
Kennecott, located near Salt Lake City, UT, has been mining and processing minerals from the rich ore body of the Bingham Canyon Mine since 1903. It is currently the second-largest copper producer in the United States. The operation includes a concentrator, smelter and refinery and tailings storage facility.
RIO has approved $498 million which will be utilized toward underground development and infrastructure for the area known as the North Rim Skarn2 (“NRS”). Production from the NRS will start in 2024 and then ramp up over the next two years. Over the next decade, it is expected to deliver around 250 thousand tons of additional mined copper.
In September 2022, Rio Tinto had approved development capital of $55 million to start underground mining in the area known as the Lower Commercial Skarn (LCS) and underground production subsequently commenced in February 2023. It is expected to deliver around 30 thousand tons of additional mined copper by 2027.
Rio Tinto also plans to use battery electric vehicle (BEV) technology at its Kennecott operation. BEVs help increase the productivity of the mine and reduce emissions from operations while creating a safer and healthier workplace for employees underground.
Rio Tinto started work on a $300 million rebuild at the Kennecott smelter in May 2023, which is the largest in Kennecott’s history. An additional $120 million is being invested to upgrade the refinery tank house structure and update Kennecott’s molybdenum flotation circuit with a state-of-the-art, fully automated system.
The long-term outlook for copper remains positive as copper demand is expected to grow, driven by electric vehicles, renewable energy and infrastructure investments. However, grade decline, rising input costs, water constraints and scarcity of high-quality developmental opportunities continue to disrupt the industry's supply. This demand-supply imbalance will support copper prices in the future.
Rio Tinto has thus been working toward building its copper production abilities. The company received a 66% direct interest in the world-class Oyu Tolgoi mine following the completion of its acquisition of Turquoise Hill Resources Ltd for approximately $3.1 billion in December 2022. In March 2023, the mine started underground production which marked a significant step toward the ramp up to become one of the world’s leading copper suppliers. By 2030, Oyu Tolgoi is expected to become the fourth-largest copper mine in the world, operating in the first quartile of the copper equivalent cost curve.
Price Performance
In the past year, shares of Rio Tinto have gained 5.2% against the industry’s 3.1% decline.
Image Source: Zacks Investment Research
Zacks Rank & Stocks to Consider
Rio Tinto currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks in the basic materials space are ATI Inc (ATI - Free Report) , sporting a Zacks Rank #1 (Strong Buy), and Gold Fields Limited (GFI - Free Report) and Linde Plc (LIN - Free Report) , each carrying a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for ATI’s current-year earnings is pegged at $2.24 per share, indicating year-over-year growth of 12.6%. The company’s shares have gained around 76.3% over the past year. ATI beat the Zacks Consensus Estimate in three of the last four quarters while delivering in-line results on the other occasion. It delivered a trailing four-quarter earnings surprise of 13%, on average.
The consensus estimate for GFI’s current-year earnings has been revised 4% upward in the past 60 days. The consensus estimate for the company’s current-year earnings is presently pegged at $1.05 per share, implying year-over-year growth of 8.3%. Gold Fields’ shares have rallied roughly 49.6% in the past year.
The consensus estimate for Linde’s current-year earnings has been revised 4.4% upward in the past 60 days. LIN beat the Zacks Consensus Estimate in all four quarters, with the average earnings surprise being 6.9%. The company’s shares have gained 23.4% in the past year.