is this the article or another one?
Cheers,
http://www.news.com.au/perthnow/story/0,21598,26219117-5017962,00.html
Felicity Williams and George Lekakis
October 16, 2009 01:40pm
RIO TINTO has unveiled a major management and structural shake-up, as it jostles for pole position to cash in on rebounding commodity prices.
The news comes as uncertainty over the $140 billion joint venture between Rio and rival BHP Billiton in WA's Pilbara mounts, amid speculation the deal may get blocked by European competition regulators.
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And it follows signs BHP is looking to beef up its uranium business through acquisition, as it moves ahead with its multi-billion-dollar Yeelirrie uranium mine also in WA.
Delivering on Jan du Plessis's promise of change when he became chairman earlier this year, Rio chief executive Tom Albanese today split off the miner's diamond and minerals operations from its copper business to create five groups along with iron ore, aluminium and energy.
He also promoted Rio's Brisbane-based head of strategy Doug Ritchie _ a major architect of the miner's aborted $US19.5 billion ($A21 billion) investment deal with Chinalco _ to leader of the group's energy business.
And he expanded the powers of Rio's Perth-based iron ore chief Sam Walsh to include responsibility for the miner's Australian head office in Melbourne.
It is believed Mr Walsh's new role will not result in any job losses or redeployments in the Melbourne office.
``Two of our five product groups will now be based in Australia, reflecting the importance of our base there, with two in London and one in Montreal,'' Mr Albanese said.
In other moves, the head of Rio's Kennecott Utah copper operation Andrew Harding has replaced Bret Clayton to lead the copper group, and the miner's head of iron ore and titanium Harry Kenyon-Slaney will take the reins from Preston Chiaro at the diamond and minerals business.
The shake-up follows the start of Rio and BHP's talks with the European Competition Commission over their proposed tie-up in the Pilbara.
Analysts, however, are increasingly concerned the deal _ expected to create about $US10 billion in cost savings through the combination of the miners' port, rail and mines in the Pilbara _ will fall over the face of intense steel industry opposition.
The steel industry is concerned Rio and BHP _ the world's second and third largest iron ore producers after Brazil's Vale _ will be able to push up iron ore prices by cutting back supplies if they join forces.
One analyst, who did not want to be named, told BusinessDaily the joint venture only stood a 50-50 chance of winning competition approvals.
Whichever way the iron ore partnership between BHP and Rio ends up, it could have significant implications for BHP's acquisition strategy _ particularly in the uranium industry.
With Chinese and Japanese nuclear power companies eyeing more investment in Australia's uranium sector, BHP is facing a big decision on whether to swoop before the best assets are put out of its reach.
BHP owns the Olympic Dam mine in South Australia and wants to increase its exposure to the feedstock ahead of an expected rise in global demand as more nuclear generators are commissioned in China and India.
Its preference is still to acquire Rio's uranium assets _ the Ranger mine and Jabiluka deposit in the Northern Territory _ but if this is not achievable because of competition concerns or Rio's unwillingness to sell, it would have to consider alternative targets.
Rio's strategic ambitions in uranium are not clear.
It sold its Kintyre uranium asset last year to an international consortium and it has not sought to mop up minorities in its 68 per cent-owned listed vehicle, Energy Resources of Australia.
Sources close to BHP told BusinessDaily yesterday that the mining giant was likely to acquire more uranium assets in the near term to meet its obligation to supply strategic customers.
``BHP needs another mine to ensure it can meet supply agreements it has negotiated with clients,'' a respected industry source said.
``In the past BHP has had to buy uranium from other producers to fill gaps caused by inconsistent output at Olympic Dam.''
In terms of BHP's big ambitions, the only Australian-based uranium player with significant assets under development is Paladin.
Paladin is working this year to increase annual production at the mine to 3.7 million pounds and will embark on another expansion in 12 months to take that to 5.2 million pounds.
Bell Potter's head of equities research Peter Quinton said that would make Paladin ``a substantial global player''.
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