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BHP Billiton, Rio Tinto Update Proposed Iron Ore Production Joint Venture
10/16/2009 - Terms of the original agreement called for up to 15% of production to be sold by the joint venture, independent of BHP Billiton and Rio Tinto. Following discussions, the companies decide not to proceed with the JV marketing activity.
BHP Billiton and Rio Tinto signed a nonbinding agreement on June 5 to establish a production joint venture covering all of the companies’ Western Australian iron ore assets.
Terms of the original agreement called for up to 15% of production to be sold by the joint venture, independent of BHP Billiton and Rio Tinto. Following discussions, the companies have decided not to proceed with the joint venture marketing activity. All production from the proposed joint venture will be marketed separately by BHP Billiton and Rio Tinto.
The two companies believe that this change will clarify the nature of the joint venture for customers and emphasize its focus on realizing significant production and development synergies.
Progress toward definitive joint-venture agreements is being made, the companies noted, and they expect to finalize them on schedule. Formation of the joint venture is expected to be completed around mid-2010, according to the earlier announcement.
