NEW YORK (TheStreet) -- Rio Tinto (RTP) - Get REINVENT TECHNOLOGY PARTNERS CLASS A Report has resumed the expansion in its Iron Ore Company of Canada operations, following IOC board's approval of new investment of $401 million. Rio Tinto's share in the investment stands at $235 million.
The move is aimed at increasing annual concentrate capacity by 4 million tonnes to 22 million tonnes by 2012. The investment is the first stage of a three-stage expansion program at IOC that could increase concentrate annual capacity to 26 million tonnes.
IOC Chairman and Rio Tinto Chief Executive for Iron Ore Sam Walsh said the decision highlighted the growing confidence in the demand for iron ore, the attractiveness of investing in Canada and the quality and potential of IOC's assets.
"Some uncertainty and potential volatility remain about global economic recovery, but global iron ore and steel markets have rebounded strongly and demand growth looks set to continue," Walsh said.
The investment was first approved in March 2008 but suspended later that year as the global financial crisis impacted markets worldwide.
IOC is the largest manufacturer of iron ore pellets in Canada and its customer base covers North American, European and Asian steel producers.
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