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Rio Tinto Workers Detained in China

The Associated Press

Rio Tinto has been unable to contact the employees, said Nick Cobban, a company spokesman in London. He said it has asked Chinese authorities the reason for the detention but has received no response.

Australian diplomats in Shanghai were urgently seeking access to the Australian man, the country's Department of Foreign Affairs and Trade said in a statement. It said it couldn't comment on reasons for the detention and didn't identify the man further.

The Sydney Morning Herald newspaper identified the Australian as Stern Hu and said the other three employees were Chinese nationals. It said the four were members of Rio Tinto's iron ore sales team. The paper cited no sources.

Cobban declined to disclose the names or personal details of the employees.

A spokesman for the Shanghai police, who would give only his surname, Liang, told the Associated Press he had no information on the case.

Rio Tinto, the world's third-largest mining company, is acting as lead negotiator for global iron ore suppliers in price talks with Chinese mills. The two sides failed to reach agreement by the June 30 expiration of previous buying contracts. China's steel industry association, representing for the country's mills, rejected prices negotiated by Rio Tinto with Japanese and Korean mills. The other major suppliers are Australia's BHP Billiton (BHP Quote) and Brazil's Vale(VALE Quote).

China criticized Rio Tinto and the Australian government last month after the company abandoned a deal to have state-controlled Aluminum Corp. of China(ACH Quote), or Chinalco, invest $19.5 billion in Rio Tinto.

Rio Tinto, which is traded on stock exchanges in London and Sydney, launched a rights issue to raise money instead. Chinalco took up a $15.2 billion portion of that issue to maintain its 9% stake in the company.

The Chinese steel industry group also has criticized Rio Tinto's plan to form a joint venture with Billiton combining their mining assets in western Australia. The group said the tie-up might reduce competition, raise prices and hurt customers.

China's Commerce Ministry said the breakup of the Rio Tinto-Chinalco deal would not harm Beijing's ties with Australia. But he warned that the deal with Billiton might face an anti-monopoly investigation by Chinese authorities.

Associated Press Writer Rohan Sullivan in Sydney and Associated Press researcher Bonnie Cao in Beijing contributed to this report.