Kestrel Mine extension

Rio Tinto PLC
17 December 2007


Rio Tinto approves US$991 million Kestrel Mine extension

17 December 2007


Rio Tinto has announced a significant new investment in its coal production
capacity in the Bowen Basin region of Queensland, Australia.

The US$991 million investment in the extension of the Kestrel Mine (nominal
terms, 100 per cent basis, Rio Tinto share US$793 million) will allow Rio Tinto
to capture more of the growing demand for export coal.  Higher quality
metallurgical coal is vital to boost steel production needed to satisfy fast
growing demand driven by rapid urbanisation and rising incomes in Asian markets.
The extension is subject to government approvals.

Preston Chiaro, chief executive Energy, said the Kestrel Mine extension will
extend the life of the mine and increase production to an average of 5.7 million
tonnes of coal a year until 2031.

'This represents a further 20 year commitment to the Bowen Basin and is a strong
vote of confidence in the Asian coal market.  The extension will enable us to
tap into 112 million tonnes(1) of high quality hard and semi-hard coking coal
and thermal coal for export.'

Mr Chiaro said the Kestrel Mine extension will incorporate sustainable
development in its design to improve energy efficiency and reduce water usage.
It is expected to create up to 250 jobs during construction and the current
operating workforce of 320 will transition to the new extension.

Rio Tinto's Australian-based managing director Strategy, Doug Ritchie, said, '
This extension is one of a number of recent investment decisions aimed at
fulfilling Rio Tinto's unrivalled strategy and growth plans.  It comes hard on
the heels of the 26 November announcements to Rio Tinto's investors on the key
value drivers underpinning Rio Tinto's growth strategy.'

'Our primary objective is to create further value for our shareholders and
deliver very substantial returns in the future. We are entering into an
unprecedented period of demand growth and Rio Tinto is well paced to meet this
demand,' he said.

Investments approved in 2007 include the underground development of the Diavik
Diamond Mine in Canada (US$563 million) bringing total investment in the
underground mine to US$787 million, the new Mesa A/Warramboo and Brockman 4
mines in Western Australia (US$2.42 billion), the Rio Tinto Alcan acquisition
completed in November 2007 (US$38.1 billion), the Hope Downs iron ore expansion
to 30 million tonnes per year (US$350 million), the Yarwun alumina refinery
expansion to 3.4 million tonnes per year (US$1.8 billion) and the Cape Lambert
port expansion to 80 million tonnes per year (US$860 million).


Notes to editors:

Kestrel Mine Extension

The Kestrel Mine, located 51 kilometres north-east of the central Queensland
town of Emerald, currently produces about four million tonnes of high volatile
coking and thermal coal per year for the export market, using the longwall
mining method.

First longwall coal from the Kestrel Mine extension is expected in 2012, when
the existing mine starts ramping down. The extension will require a new
automated run of mine stockpile system and a seven kilometre overland conveyor
to the existing coal handling and preparation plant.

A 375 metre wide longwall will replace the existing 250 metre wide longwall.
This new longwall will achieve a substantially lower unit cost for mining and
increased productivity. A new workshop, warehouse, storage facilities and
administration building will be constructed, however many of the existing
Kestrel Mine facilities will continue to be used.


For further information, please contact:

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Website: www.riotinto.com
High resolution photographs available at: www.newscast.co.uk



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(1) Please refer to previously announced ore reserves in the Rio Tinto 2006
    Annual report and financial statements


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