MONTREAL - Rio Tinto Alcan's global aluminum production fell two per cent in the third quarter after it lost more than US$52 million worth of production after an explosion caused the partial shutdown at one of its Quebec smelters.
A power outage in July at the Laterriere smelter caused the loss of 25,000 tonnes of production, mining giant Rio Tinto （NYSE:RIO） said Thursday during its quarterly operations review.
The price of aluminum hit US$2,100 per tonnes last summer before increasing to US$2,300 in the fall.
Full production was restored the end of September.
The Montreal-based division hasn't disclosed the financial impact of the shutdown, but said it would be millions of dollars.
It expects aluminum production will be 3.8 million tonnes in 2010.
During the first nine months of the year, production was down slightly to 2.83 million tonnes.
Rio Tinto CEO Tom Albanese said the Anglo-Australian mining company delivered a strong operating performance in the quarter, achieving record production in iron ore, alumina and coking coal.
"We continue to run our operations at close to or above capacity rates, taking advantage of strong prices for our products," he stated.
Rio Tinto approved more than US$4 billion of capital programs during the quarter, raising the total to US$5.5 billion for the year. By December 2011 it expects to spend US$13 billion on capital expenditures, including several costly projects in Quebec and British Columbia.
Alcan division president Jacynthe Cote said Wednesday the company is cautiously watching the global economy and inventory levels ahead of giving the projects the green light.
Iron Ore Co. of Canada, in which Rio Tinto holds a roughly 58.7 per cent stake, saw production of pellets and concentrate increase by 72 per cent during the quarter. The improvement reflected a recovery in demand from last year when weak market conditions forced a five-week shutdown.
The world’s third-largest mining company said third-quarter iron ore output increased 1.2 per cent to 47.6 million tonnes.
Diamond production at the Diavik mine, which is 60 per cent owned by a Rio Tinto subsidiary, grew 117 per cent from a year ago when there was a six-week shutdown.
Damien Hackett of Canaccord Genuity said Rio saw output increase from the second quarter in eight of the 13 major commodity groups, led by copper.
He said strong production and commodity prices should boost the company's shares, which briefly hit a two-year high.
On the New York Stock Exchange, the shares closed at US$65.89, up $1.83 or 2.86 per cent.
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