(Alliance News) - Rio Tinto PLC on Wednesday said it is tripling its carbon emissions reduction target and is now hoping to cut those emissions by 50% by 2030.
Shares in the FTSE 100-listed miner were down 2.5% in London on Wednesday morning at 4,923.50 pence each. It closed flat in Sydney at AUD98.08.
By 2025, Rio is targeting a 15% reduction in its Scope 1 & 2 carbon emissions, which is five years earlier than previously. The miner noted these targets are supported by around USD7.5 billion of direct investments to lower emissions between 2022 and 2030.
The reduction are based on a baseline from 2018 of 32.6 million tonnes.
"In recognition of the broader carbon footprint of the commodities it produces, Rio Tinto will accelerate its investment in R&D and development of technologies that enable its customers to decarbonise. Working in partnership with governments, suppliers, customers, academia and others Rio Tinto will continue to develop technologies like ELYSISTM for carbon-free aluminium and multiple pathways to produce green steel," Rio explained.
It continued: "Rio Tinto can decarbonise, pursue growth and continue to deliver attractive returns to shareholders due to its strong balance sheet, world-class assets and focus on capital discipline."
To support this growth the miner said its capital expenditure is likely to reach USD9 billion and USD10 billion in 2023 and 2024, respectively.
Chief Executive Jakob Stausholm said: "All our commodities are vital for the energy transition and continue to benefit from ongoing urbanisation. We have a clear pathway to decarbonise our business and are actively developing technologies that will enable our customers and our customers' customers to decarbonise."
Rio noted its medium-term Pilbara iron ore system capacity will sit between 345 and 360 million tonnes per year. Decarbonisation of Pilbara, Rio said, will be accelerated by targeting the "rapid deployment" of 1 gigwatts of wind and solar power, replacing natural gas power for plant and infrastructure and supporting early electrification of mining equipment.
For its aluminium operations, Rio said it is progressing the switch at Boyne Island and Tomago smelters in Australia to renewable energy, which will require about 5GW of solar and wind power.
"We are able to do this, while continuing to provide attractive returns to our shareholders in line with our policy, because we have a strong balance sheet and world-class assets that deliver strong free cash flows through the cycle," Stausholm added.
By Paul McGowan; paulmcgowan@alliancenews.com
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