Rio Tinto’s Russian partner hits back at refinery lockdown
Russian aluminum giant Rusal has hit back at moves to prevent it from making management decisions at one of Australia’s biggest alumina refineries, saying it was still in talks with Rio Tinto over of his continued role in the factory.
Rio Tinto, 80% owner of Queensland Alumina Limited (QAL) in Gladstone, said last week it had stepped in to take full control of the business by exercising ‘step-in’ rights which give it control sole decision maker and take 100% of the company’s alumina production.
The mining heavyweight made the announcement after the federal government banned all alumina exports to Russia to limit the country’s ability to manufacture aluminum, a key material needed by the construction industry and in the manufacture of arms and ammunition. Oleg Deripaska, a Russian billionaire who owns a large majority stake in Rusal, has also been added to Australia’s list of sanctioned businessmen.
However, in a statement filed with the Hong Kong Stock Exchange, Rusal said it rejected Rio Tinto’s finding that the step-in provisions had been triggered.
“The Company disagrees that the operations of its subsidiary, Alumina & Bauxite Company Ltd, through which the Company holds its stake in QAL, are not currently in compliance with Australian Government sanctions. and does not agree with the decision taken by the management of QAL to intervene”. agreements’ under the terms of the joint venture have been triggered or are required,” Rusal said.
“Discussions with QAL and Rio Tinto continue on the Australian Government’s sanctions intent and the continued involvement of Alumina & Bauxite Company in the operations of the QAL-owned Gladstone Alumina Refinery.”
Rio Tinto, one of the world’s largest mining companies, is among a growing number of companies in Australia and around the world seeking to sever business ties with Russian companies after Ukraine invaded Vladimir Poutine.
After conducting a week-long legal review of its partnership agreement with Rusal, Rio Tinto said on Friday it had taken over 100% of QAL’s capacity and governance “until further notice”.