Automated trains derailed

Rio Tinto has decided to postpone work at this stage on its Western Australian iron ore Automated Train Operations (ATO) programme in the latest moves to offset massive debts from the $US38 billion acquisition of Canadian aluminium producer Alcan.

Rio Tinto has decided to postpone work at this stage on its Western Australian iron ore Automated Train Operations (ATO) programme in the latest moves to offset massive debts from the $US38 billion acquisition of Canadian aluminium producer Alcan.

The US$371 million ATO project was approved in July 2008, designed to bring greater efficiency to RTIO’s rail operations as Pilbara infrastructure rapidly expanded beyond its current 220 million tonne annual capacity.

The easing of market growth caused by the economic slowdown has reduced the urgency of this project, according to a company statement.

RTIO chief executive Sam Walsh said the ATO project had made great strides towards its 2012 implementation, when it would deliver greater flexibility and fewer delays to Rio Tinto’s integrated iron ore infrastructure in the Pilbara.

“Substantial progress has been made towards implementation, with the trials proving successful, and the programme’s momentum can be easily renewed when circumstances permit,” Walsh said.

The move comes after the company pulled the pin on a $US2.15 billion ($A3.1 billion) development at its Corumba mine in Brazil.

Rio had planned to expand Corumba from 2.4 million tonnes of iron ore a year to 12.8 million tonnes by the end of 2010.

Rio spokesman Gervase Greene said that all the miner’s projects remained under review.

“It is in response to a severe market downturn, which has clearly impacted on our iron ore demand,” he said.

“It is important to note that we retain the option to pursue that expansion (Corumba) when credible signs of the market recovery are seen, but until such time we have postponed it.”

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