Rsps to Labrador Iron T'stees

Rio Tinto PLC
6 April 2001

        Rio Tinto responds to the announcement by the Trustees of the         
                                                                              
                    Labrador Iron Ore Royalty Income Fund                     

 
Rio Tinto responded on 5 April 2001 to the announcement by the Trustees of
the Labrador Iron Ore Royalty Income Fund (the 'Fund') that they have
declared distributions of C$0.375 per unit for each of the remaining three
quarters of 2001 and that they will increase annual distributions to C$1.50
until the expansion of the Iron Ore Company of Canada ('IOC') is completed.
The Trustees' actions are misleading and potentially harmful to the long-term
value of the Fund.
 
The Fund paid C$1.05 per unit in distribution in 2000 and the consensus
estimate from research analysts, based on the current outlook for IOC, is
C$1.04 per unit for 2001. In order to finance the increased distributions,
the Fund's subsidiary will be required to borrow money, something that the
Fund itself is specifically prohibited from doing. By taking the
unprecedented step of declaring future distributions today, the total amount
of the Fund's liability is unknown. While certainly not adding value, the
Trustees' actions may harm the long-term value of the Fund since principal
and interest payments will reduce future distributions.
 
The Trustees' press release fails to state that the increase in distributions
will be funded solely by borrowing money. The Trustees have also claimed that
Unitholders may receive distributions of as much as C$2.00 at some future
date. While the assumptions underlying such a claim are not provided,
undoubtedly the Trustees are relying on IOC maintaining current real pricing
and full production capacity - assumptions that are problematic given the
difficult conditions for the steel industry and expected increased foreign
iron ore production. Such a claim is also dependent upon IOC resuming
dividends, something that is outside the control of the Fund. Rio Tinto
believes that the Trustees have misled Unitholders and intends to raise its
concerns with the Ontario Securities Commission.
 
Rio Tinto reiterates that it will not increase its C$14.25 Offer. Unitholders
who are concerned about the yield on their investment should accept the Offer
and reinvest the proceeds in other income trusts with higher yields based on
earned income, not borrowed money (for example, the average weighted yield of
an income trust included in the Merrill Lynch Canada Trust Index is 13.7%).
 
 
For further information, please contact:
                                                                              
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Website: www.riotinto.com