Half Year Results-Part 1

Rio Tinto PLC
3 August 2000


Part 1


                      Rio Tinto Earnings up 33 Per Cent                       
                  
 
* 2000 first-half net earnings of $677 million, up 33 per cent on the same
  period last year. 
* Strong growth in demand boosted prices for most products. 
* Continued strong cash flow from operations at more than $1.5 billion for
  the half year. 
* Successful acquisition of the remaining public shares in Comalco. 
* Offer to acquire North Limited. 
* Interim dividend up 27 per cent in Australian dollar terms and 22 per cent
  in sterling terms. 

'Further growth in the US, a pick up in Europe and Japan and continuing
recovery in emerging Asian economies raised demand for many mined products,'
said Sir Robert Wilson, Chairman of Rio Tinto.  
'The first half of this year has seen our successful acquisition of the
outstanding shares of Comalco Limited and our bid for the Australian mining
company, North Limited. The strong first-half results from Comalco
demonstrate the soundness of that acquisition which also increases our
flexibility to consider further opportunities in the aluminium industry. 
'Our offer for North provides the potential for synergies between Rio Tinto's
iron ore operations in Western Australia and those of North. There remains
little doubt that Rio Tinto is the logical acquirer. 
'Rio Tinto's cash flow from operations remains strong at over $1.5 billion
for the half year. Even with net acquisitions of $0.9 billion, including the
increased investment in Comalco and the initial 14.5 per cent stake in North,
the ratio of net debt to total capital of 28 per cent is lower than 12 months
ago.' 
 
                                                                     
           Half Year to 30 June      2000          1999      Change  

           Group sales revenue        $4,573m       $4,273m       +7%
           Profit before tax          $1,131m         $840m      +35%
           Net earnings                 $677m         $509m      +33%
           Earnings per share      49.4 cents    37.2 cents      +33%

All $ are US$, unless otherwise stated.

Interim dividends, equivalent to 19 US cents (12.66 pence and 32.68
Australian cents) per share, have been declared. This compares with the 1999
interim dividends of 16.5 US cents (10.39 pence and 25.64 Australian cents).
 

FIRST HALF 2000 REVIEW

In the first half of 2000 volumes increased at Hamersley Iron due to buoyant
Asian steel demand with resultant record first half production and shipments.
Aluminium production was up, helped by the increased stake in Comalco where
the full benefit of the acquisition will become evident in the second half.
However, lower grades impacted copper and gold production.
 
Higher fuel costs affected most operations, and lower grades reduced earnings
at a number of copper operations. In addition delayed sales affected the
Grasberg copper mine in Indonesia. Leigh Clifford, Chief Executive of Rio
Tinto, said: 'Work is under way to ensure improved performance at our major
copper operations. Additionally, we will maintain our focus on cost, capital
and margins at all operations.'
 
On projects, work continued on the Palabora underground copper mine in South
Africa while at the Diavik diamond project in Canada final permitting is
awaited. A low cost expansion of the Yandicoogina iron ore mine in Western
Australia to 20 mtpa capacity is under way. Looking ahead, evaluation work
continued on Comalco's alumina project and further expansions of Escondida in
Chile.
 
During the half year Rio Tinto joined 13 other mining companies to create a
B2B marketplace for the purchase of goods and services. This will lead to
more efficient ordering, lower inventories and access to a wider group of
suppliers. Rio Tinto is also looking at the impact of e-business on how it
sells its products.
 
On the industrial relations front, a new collective agreement was negotiated
at the Mount Thorley coal operation in the Hunter Valley in New South Wales
and overwhelmingly supported by employees in July. This is a major step
forward in securing the long-term competitiveness of our New South Wales coal
operations and hopefully leading to a more stable industrial relations
environment.
 
 
OUTLOOK 
 
'The current economic climate is favourable, resulting generally in growth of
demand and lower industry stocks,' said Sir Robert. 'These conditions would
normally be reflected in stronger prices than we are seeing today which may
be telling us that the market has concerns about the continuing durability of
the US expansion.
 
'During the second half of 2000 we expect some recovery from the lower grades
which impacted some of our copper operations in the first half and we will
benefit from the full ownership of Comalco.'
 
 
 
FIRST HALF 2000 FINANCIAL RESULTS 
 
Net earnings 
 
Net earnings, at $677 million, were $168 million (33 per cent) above the $509
million in the first half of 1999.
 
Higher selling prices contributed $181 million to earnings. Copper prices
averaged 23 per cent above the low levels of first half 1999 and aluminium
prices were up 25 per cent. Higher nickel prices were the main factor in the
substantial increase in earnings from the Group's Brazilian operations.
Earnings also benefited from higher diamond prices but have yet to reflect
the full impact of iron ore price increases effective from 1 April 2000.
 
The weakening of the Australian dollar and other exchange rates added $43
million to earnings compared with the first half of 1999.
 
Volume changes reduced earnings by $34 million. Much of this results from
delayed shipments and lower production at Grasberg. Titanium dioxide
feedstock shipments were lower and there was a less valuable mix of rough
diamond sales. Indonesian coal output was reduced as a result of a strike.
There were substantial offsetting volume increases at Hamersley and at
Comalco.
 
Rio Tinto benefited from increased ownership of Comalco in June and will take
up 100 per cent of its profits in future. If the purchase of the outstanding
shares had been completed at the start of the year, Rio Tinto would have
taken up additional earnings of $37 million in the six months, net of
amortisation of the additional investment but before the resulting increment
to interest charges of approximately $15 million.
 
Overall, costs increased by $41 million, including inflation of $26 million
and non-recurring items totalling $10 million. Cash costs increased by $5
million in real terms compared with the first half of 1999. The continued
drive for improvements in efficiency throughout the Group largely offset the
impact of higher oil prices, which are well over twice the level of a year
ago and are estimated to have added around $35 million to costs on a net of
tax basis.
 
In 2000, Australian earnings are taxable at 34 per cent, a reduction of two
percentage points compared with 1999; but this rate will reduce by a further
four percentage points in 2001. If the future Australian tax rate of 30 per
cent had been in force this year, the Group's tax charge would have been $29
million (2.6 percentage points) lower. The effective tax rate in the first
half at 31.5 per cent was reduced by 1.5 percentage points as a result of
tax-free gains. The tax rates in first half 1999 at 29.5 per cent and full
year 1999 at 27 per cent benefited from one-off reductions in deferred tax
provisions as a result of reductions in tax rates in South Africa and
Australia.
 
Other variances added $48 million to earnings. These included the gain on
disposal of the Group's coal interest in Carbones del Cerrejon in Colombia.
 
 
Cash Flow 
 
Cash flow from operating activities together with dividends from joint
ventures and associates increased by $331 million, compared with the same
period last year, to $1,560 million.
 
Acquisitions less disposals involved a net cash outlay of $902 million, which
was $620 million above the same period last year. This included payments for
shares in Comalco. A further $83 million of Comalco shares were purchased for
Rio Tinto scrip. This line in the cash flow statement also includes the
purchase of 14.5 per cent of North Limited and the sale of the Group's
interest in Carbones del Cerrejon.
 
Purchases of property, plant and equipment at $299 million, were $71 million
lower than first half 1999. Net repayments of loans to joint ventures and
associates were $223 million in first half 1999 but reduced to $18 million in
first half 2000. The balance of the loan to Freeport was repaid in the first
half of 2000.
 
Despite the high level of acquisition expenditure in the period, and dividend
payments of $513 million, the cash outflow before management of liquid
resources and financing was confined to $615 million in the six months (1999:
$272 million outflow).
 
 
Balance Sheet 
 
Shareholders' funds increased by $213 million in the half year to $7,309
million at 30 June 2000. The increase includes retained earnings of $416
million. It is net of a currency translation adjustment of $287 million,
which was due largely to a nine per cent reduction in the Australian dollar
exchange rate since 31 December 1999.
 
Net debt increased by $601 million over the six months, to $3,030 million.
Net debt to total capital at 28.4 per cent compares with 23.7 per cent at the
start of the year.
 
 
Dividends 
 
Interim dividends equivalent to 19 US cents per share (1999: 16.5 US cents)
have been declared by Rio Tinto plc and Rio Tinto Limited.
 
Dividends continue to be determined in US currency. Rio Tinto Limited
dividends are declared and paid in Australian dollars and Rio Tinto plc
dividends are declared and paid in pounds sterling, converted at exchange
rates applicable two days prior to their announcement.
 
Rio Tinto plc shareholders will be paid an interim dividend of 12.66p per
ordinary share (1999: 10.39p).
 
Rio Tinto Limited shareholders will be paid an interim dividend of 32.68
Australian cents per ordinary share (1999: 25.64 cents). This will be fully
franked at the tax rate of 34 per cent. The directors consider that there are
sufficient franking credits available for paying fully franked dividends for
at least the next year.
 
The respective dividends will be paid on 15 September 2000 to shareholders
registered at close of business on 18 August 2000, and to Rio Tinto plc
bearer shareholders against coupon 83 on or after 15 September 2000. The
ex-dividend date will be 14 August 2000. Dividends to Rio Tinto ADR holders
will be paid on 18 September 2000.
 
 
Share Issues and Buy-backs 
 
During the six months to 30 June 2000, 3.16 million Rio Tinto plc shares and
2.14 million Rio Tinto Limited shares were issued in connection with the
Comalco acquisition. As previously announced it is Rio Tinto's intention to
buy back, subject to market conditions, a number of shares equal to those
issued in connection with the Comalco offer. So far 1.2 million Rio Tinto plc
shares have been purchased and cancelled by Rio Tinto plc at an average price
of 1035p per share and 0.74 million Rio Tinto Limited shares have been
purchased and cancelled by Rio Tinto Limited at an average price of A$25.13
per share. In addition, Rio Tinto Limited purchased off market and cancelled
91 million Rio Tinto Limited shares held by Tinto Holdings Australia Pty.
Limited (a wholly owned indirect subsidiary of Rio Tinto plc).
 
 
REVIEW OF RIO TINTO OPERATIONS 
(Production shown is the product group share of output unless otherwise
stated)
 
 
IRON ORE GROUP                      
2000 first half earnings $141 million, up 16% 
Production at 28.6 million tonnes, up 19% 
 
Rio Tinto's Iron Ore group accounted for 11 per cent of Group turnover and
contributed 21 per cent of net earnings in the first half of 2000.
 
Hamersley achieved record iron ore production and shipments despite
disruptions caused by cyclones in the first quarter. In total, 32 million
tonnes were shipped in the half year, 21 per cent more than in the same
period of 1999. Demand strengthened in major markets, particularly China and
Japan, and Yandicoogina ore was much sought after. A price increase of
approximately five per cent was agreed with Japanese steel mills for the
delivery year commencing 1 April 2000.
 
 
INDUSTRIAL MINERALS GROUP  
2000 first half earnings $179 million, down 5% 
Borate production at 280,000 tonnes, down 3% 
Titanium dioxide feedstock production at 659,000 tonnes, down 10% 
 
Rio Tinto's Industrial Minerals businesses accounted for 22 per cent of Group
turnover and contributed 26 per cent of net earnings in the first half of
2000.
 
Rio Tinto Borax's earnings of $52 million were 13 per cent lower than in the
same period of 1999. Sales in most markets for borates were flat, with
weakness in Europe caused by continuing pressures on pricing in the
marketplace, exacerbated by the weakness of the euro against the dollar.
Significant work was undertaken in connection with the redesign of the Boron
mine in California in the US as it moves into a period of higher stripping
rates.
 
Rio Tinto Iron & Titanium earnings were 18 per cent lower at $66 million in
the first half of 2000, reflecting softer demand for feedstocks, reduced
production at Richards Bay to balance inventories and the absence of the one
off tax credit in 1999 arising from the reduction in South African tax rates.
Customer destocking was an important factor in the softer titanium dioxide
feedstock demand. Iron and steel co-product markets remained intensely
competitive although those for zircon strengthened. Reconstruction of QIT's
Canadian Sorel furnace damaged by fire in mid 1999 proceeded to plan.
 
Continued strong demand for Argyle diamonds in Western Australia resulted in
an earnings improvement of 50 per cent to $45 million. Lower ore grade was
partially offset by an increase in ore processed but diamond production was
slightly lower at 14.2 million carats.
 
Earnings at Luzenac's talc operations in Europe and North America saw flat
demand in the Northern Hemisphere but benefited from continuing cost
containment measures. Accordingly, profits remained at a similar level to
those in the first half of 1999.
 
Exceptionally heavy rainfall at Dampier Salt's Dampier field, and flood
conditions at the Lake MacLeod operation in Western Australia, adversely
affected production and, as a result, sales and earnings were lower. The
effect on production will depend on the developing weather pattern over the
balance of the year but it was necessary to declare a partial force majeure
on shipments.
 
 
COPPER GROUP                      
2000 first half earnings $87 million, down 24% 
Mined copper production at 409,000 tonnes, down 6% 
Refined copper production at 186,000 tonnes, up 1% 
 
Rio Tinto's Copper group accounted for 20 per cent of Group turnover, of
which 72 per cent was from copper and the remainder mostly from gold
co-product. The Copper group contributed 13 per cent of net earnings in the
first half of 2000. The average copper price in the first half of 2000 was 80
cents/lb, 23 per cent higher than the average in the first half of 1999. The
average gold price was $285/oz in the first half compared with $280/oz in the
first half of 1999.
 
In the US Kennecott Utah Copper's mine production of copper was three per
cent lower but that of gold 38 per cent higher, due primarily to changes in
ore grades. The smelter operated at 104 per cent of design capability during
the first six months, and refined copper and gold production both increased,
by four per cent and 15 per cent respectively. Operating costs associated
with the new tailings facilities, including depreciation, higher fuel costs
and a major planned maintenance shutdown in the smelter in April, depressed
earnings.
 
At Grasberg in Indonesia total production of copper and gold was affected by
lower ore grades despite higher milling and recovery rates. Sharply higher
mine costs and delayed sales impacted earnings. However, more of the
production was attributable to the Joint Venture, resulting in Rio Tinto's
share of copper decreasing by three per cent while that of gold was 32 per
cent down. PT Freeport Indonesia agreed to limit temporarily production from
its Grasberg open pit to an average of 200,000 tonnes of ore per day in May
pending the conclusion of technical studies and recommendations for the safe
use of the Wanagon Basin for overburden storage. Underground production
remains at 20,000 tonnes of ore per day and development of the DOZ block cave
continues in line with plans. As a result of Freeport-McMoRan Copper & Gold
(FCX) share buy-backs during the first half of 2000, Rio Tinto's holding in
FCX has increased from 14.6 to 15.7 per cent.
 
Ore grade at Escondida in Chile continues to decline in line with long-term
projections and this resulted in a 14 per cent reduction in mined copper
output in the first half of 2000. Refined copper produced by the oxide plant,
which has consistently exceeded design capacity at lower than planned cost,
increased by 13 per cent.
 
Heavy rains flooded the open pit at Palabora in South Africa in the first
quarter of the year. This severely reduced ability to blend ores which
impacted on milling and concentrator throughputs. However ore grade was
higher and, as a result, mined production of copper increased by 22 per cent.
Smelter maintenance and operating delays reduced anode supply and refined
copper production was 30 per cent lower. A major smelter overhaul was
completed in July and production performance has returned to normal levels.
 
Rio Tinto commenced the process to sell its 49 per cent interest in the Neves
Corvo underground copper mine in Portugal early in the year and a number of
expressions of interest have been received. In the first half of 2000, Neves
Corvo's copper production decreased by six per cent, reflecting a decline in
treated volumes.
 
 
COMALCO                 
2000 first half earnings $156 million, up 200%
Bauxite production at 4.8 million tonnes, up 15% 
Alumina production at 664,000 tonnes, up 15% 
Aluminium production at 268,000 tonnes, up 13% 
 
Comalco, Rio Tinto's Australian integrated aluminium group, accounted for 18
per cent of Group turnover and contributed 23 per cent of net earnings in the
first half of 2000.
 
The average aluminium price was 25 per cent higher than in the same period of
1999 and the average Australian dollar exchange rate weakened by around five
per cent against the US dollar. Comalco earnings in the first half of 2000
also benefited from a tight alumina market, with spot sales at significantly
higher prices than in 1999. Rio Tinto's share of earnings also benefited from
its increased ownership in Comalco during this period.
 
Bauxite production mainly reflected the impact of seasonal weather conditions
at Weipa in Queensland. Process improvements at Eurallumina in Italy resulted
in record alumina output while Queensland Alumina's production remained
strong. Aluminium metal production also benefited from process improvements. 
 
Comalco's PEP programme continues to generate savings across all sites which
have helped to offset the impact of higher fuel prices in the first half of
2000.
 
 
ENERGY GROUP                
2000 first half earnings $117 million, up 5% 
Coal production at 62 million tonnes, down 8% 
Uranium oxide production at 1,059 tonnes, down 6% 
 
Rio Tinto's Energy group accounted for 19 per cent of Group turnover and
contributed 17 per cent to net earnings in the first half of 2000.
 
In the US, even though electrical consumption was up over four per cent from
the same time last year, increased customer stockpiles caused by mild weather
and preparations for Year 2000, coupled with increased nuclear plant
utilisation, are playing a role in the lower demand for coal. This reduction
in demand and pressure on spot prices caused major producers to cut back
production. Kennecott Energy reduced output by eight per cent compared with
the same period in 1999 and its costs were adversely affected by abnormally
high diesel fuel prices.
 
Overall production from the Australian coal operations was similar to that in
1999. In New South Wales, Coal & Allied Industries' profitability improved
due to better operational performance and the settlement of a contractual
dispute with a significant domestic customer. A three-year collective
agreement for the Mount Thorley operation was signed in July, the terms of
which allow for significant workplace reforms. Pacific Coal, in Queensland,
achieved record production levels at Kestrel. At Blair Athol, Pacific Coal
has taken steps to overcome gas leakage from old underground workings which
has hampered output. Oversupply in internationally-traded coking and steam
coal markets resulted in further price reductions of up to six per cent.
 
At Kaltim Prima in Indonesia significant equipment was committed to
developing access to new areas. This, together with high rainfall, low in-pit
inventories and industrial action by one of the three site trade unions,
constrained production. Following a three-week strike and blockade of the
coal processing plant by one of the unions, force majeure was declared on
commercial coal sales in July.
 
In January Rio Tinto disposed of its one-third interest in Carbones del
Cerrejon in Colombia at a profit of $55 million.
 
In Namibia Rossing's uranium oxide production was six per cent lower than in
the first half of 1999. The spot uranium oxide price continued to fall and
ROSSING commenced a programme to reduce costs by 20 per cent. The previously
announced reduction in Namibian mining tax rates has yet to be enacted.
 

GOLD & OTHER  
MINERALS GROUP  
2000 first half earnings $79 million, up 58% 
Gold production at 581,000 ounces, down 20%  
 
Rio Tinto's Gold & Other Minerals group accounted for ten per cent of
turnover and contributed 12 per cent of net earnings in the first half of
2000.
 
The average gold price, at US$285/oz, was two per cent higher than in the
first half of 1999 and those of aluminium, nickel and zinc were higher, by 25
per cent, 95 per cent and 13 per cent respectively.
 
Higher ore grade, additional milling capacity installed in 1999 and improved
recoveries increased gold production by 38 per cent at Morro do Ouro in
Brazil. In the US Kennecott Minerals output was 26 per cent lower; the
Ridgeway mine was closed in late 1999 and gold production at Cortez was down
due to the processing of mixed ore and the development of the Cortez Pipeline
pit.
 
Production was substantially lower at Kelian in Indonesia where mining
activities were suspended from late April until mid June as a result of a
dispute over land compensation claims.
 
Unscheduled maintenance and lower grade at Lihir in Papua New Guinea resulted
in reduced output and Rio Tinto's interest decreased to 16.3 per cent as a
result of the merger of Lihir Gold and Niugini Mining in early 2000. In June
Lihir announced a 20 per cent increase in total reserves to 13.4 million
ounces.
 
In Australia the $20 million development of Peak Gold's New Occidental
orebody will extend the life of the mine by up to five years. Political and
economic problems impacted gold operations at Rio Tinto Zimbabwe.
 
At Anglesey Aluminium in the UK production records lifted output by three per
cent and opacity of stack emissions was reduced significantly due to
refurbishment of the carbon bake plant.
 
The Greens Creek zinc/lead/silver mine and mill in Alaska continued to
implement productivity improvements and consistently exceeded design
throughput but ore grades varied with the mining sequence resulting in
similar tonnages of zinc and silver being produced. In Norway Norzink's zinc
production was five per cent lower due to avalanches early in the year and
extended maintenance.
 
Production of nickel in matte increased by 21 per cent at the Fortaleza mine
in Brazil where the transition to underground mining will be completed by
year-end.
 

CORPORATE ACTIVITY 
 
During the half year Rio Tinto offered to acquire the outstanding shares in
Comalco Limited. This offer has been successful and Comalco is now a wholly
owned subsidiary of Rio Tinto. The acquisition cost was $0.9 billion.
Weighted average ownership of Comalco during the first half of the year was
78 per cent. As a result of the increased ownership of Comalco, Rio Tinto's
total beneficial primary aluminium smelter capacity has increased from
600,000 tonnes a year to 760,000 tonnes a year.
 
On 23 June Rio Tinto announced a cash offer of A$3.80/share to acquire all
the issued shares of North Limited in Australia after acquiring a 14.5 per
cent stake.
 
 
NEW PROJECT DEVELOPMENT 
 
In the Iron Ore group, trial shipments of Hamersley's Nammuldi Marra Mamba
iron ore were made during the half year to several customers. In June the
Western Australian Government approved the expansion of Yandicoogina to 20
million tonnes per year, enabling Hamersley to participate fully in one of
the fastest growing market sectors for iron ore. No major changes to the
existing facilities are planned but plant modifications will allow operating
hours and throughput rates to be increased and will be completed by the end
of 2000.
 
Subject to definitive studies, which are expected to be completed by
November, a HIsmelt(R) direct smelting technology plant, capable of producing
around 600,000 tonnes of hot metal per year, is planned to be installed at a
Nucor facility in the US. If successful, the HIsmelt(R) technology could be
further scaled up to plants capable of producing over 1.5 million tonnes of
hot metal per year.
 
In Industrial Minerals, Richard Bay Minerals' $170 million fifth dredge was
fully commissioned on schedule and to budget by early 2000. Construction of
the C$1.3 billion 20-year life Diavik Diamonds project in Canada remains
subject to receipt of final permits and licences and owners' approval.
 
Within the Copper group work on Palabora's $437 million underground mine
continued with overall construction progress now standing at 55 per cent.
Underground production is scheduled for 2003 to coincide with closure of the
open pit. Evaluation of the Escondida $1.2 billion Phase 4 expansion
feasibility study continued with a decision expected by year-end. The oxide
plant will be expanded by eight per cent to 150,000 tonnes per year capacity
from March 2001 at a cost of just over $7 million.
 
Consideration is being given to restarting the Hail Creek coking coal project
in Queensland which was put on hold at the start of 1999.
 
Comalco continued to evaluate a new greenfield alumina refinery at Gladstone
in Queensland based on Weipa bauxite.
 

EXPLORATION 
 
Total pre-tax exploration expenditure charged to the profit and loss account
for the first half of 2000 was $58 million compared with $64 million for the
first half of 1999.
 
Global prioritisation of the exploration programme continued. New programmes
for a variety of commodities were initiated in prospective terrain around the
world and other less prospective programmes were terminated.
 
In Canada early stage programmes resulted in identification of a
diamondiferous kimberlite pipe on the Tahera option in Nunavut and uranium
mineralisation on the JNR alliance in Saskatchewan. Work continued in both
areas. Processing of surface bulk samples commenced at the Dachine diamond
option in French Guyana, drill sampling of kimberlite pipes continued in the
Catalao area of Brazil and reconnaissance drilling of sulphide nickel targets
commenced in the Giles complex of central Australia. These programmes will
continue during the third quarter.
 
Generative work in Turkey, Indonesia, Chile, Peru and northern Mexico
identified attractive copper prospects for drill testing in the third
quarter. Attractive drill targets were identified on a polymetallic massive
sulphide prospect in south-eastern Alaska and on gold prospects in Alaska and
Argentina.
 
On more advanced programmes, delineation drilling continued on recently
discovered gold-copper mineralisation within the Ertsberg intrusion on
Freeport Contract of Work A in Indonesia. Delineation drilling also continued
at the Argyle diamond mine in Western Australia and at the Simandou iron ore
prospect in south-eastern Guinea.
 
 
E-BUSINESS 
 
Rio Tinto has been investigating actively the use of e-business technologies
as they apply to procurement since mid 1999.
 
Building on a successful corporate Group purchasing programme, the
application of e-technologies was identified as a key strategic component
required to help capture maximum efficiencies from the Group's supply chain.
 
Plans for an internal Rio Tinto exchange were put on hold prior to Easter
2000 when the Group entered into discussions with other industry participants
to investigate the potential of creating an industry-wide, open and neutral
e-marketplace for the purchase of goods and services. Discussions culminated
in an announcement in May that 14 significant companies in the Mining and
Minerals sector had agreed to pursue jointly the establishment of an
industry-wide e-marketplace.
 
Rio Tinto is contributing a mixture of personnel and resources to support the
project team in Los Angeles which is developing the detailed scope of the
Mining & Minerals e-Marketplace. An announcement about the formation of the
e-marketplace will be made towards the end of the third quarter 2000.
 
In addition, internal project teams have been working to prepare business
units to exploit the opportunities provided by e-procurement. This work
further extends Rio Tinto's collaborative purchasing activities.
 
The impact on how goods and services are purchased will be positive, allowing
more efficient ordering, reduced inventories, access to a wider market of
suppliers and lower costs.
 
In respect of marketing Rio Tinto's diversity of production, the impact of
e-business is less certain. A study of potential opportunities for the
various commodities is under way, involving representatives of all product
groups.
 
 
 
For further information, please contact:
     
Media Relations                   Investor Relations 
 
Lisa Cullimore                    Peter Jarvis
+ 44 (0) 20 7753 2305             + 44 (0) 20 7753 2401
 
Website: www.riotinto.com
 
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