Rio Tinto Alcan has withdrawn from its 49% financing role of a joint aluminium project in Saudi Arabia.
Rio was to act as equity partner in a ‘mine-to-metal’ project with Saudi Arabian Mining Company (Ma’aden) at a cost of US$10 billion.
“The recent global financial and economic crisis has changed Rio Tinto’s outlook for project development throughout the world,” Rio Tinto Alcan chief executive Dick Evans said.
“Under these circumstances Rio Tinto Alcan has elected to not participate as an equity partner in the project.”
Despite not gong ahead with financing, Rio remains in discussions with Ma’aden to provide technological support for a smelter technology transfer agreement, as well as general advice and support.
“Going forward, our partnership will be one of cooperation rather than one of equity ownership,” Evans said.
According to the company, a cooperation deal between Rio and Ma’aden will cover secondment of personnel, interim supply of alumina to the smelter, metal offtake, and other support activities.
Rio took on the 49% ownership of the joint venture project after its $US38.1 billion purchase of Canada’s Alcan in July 2007.