EX-99.4 5 rt3.htm Exhibit 99.4

Notice to ASX

Increase to Pilbara Ore Reserves

3 March 2016

Included in Rio Tinto’s annual Ore Reserves and Mineral Resources update, released to the market today as part of its 2015 Annual Report, are increases in Ore Reserves in Pilbara iron ore deposits in Western Australia.

The updated Ore Reserves and Mineral Resources are reported in accordance with the Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves, 2012 (JORC Code) and Australian Securities Exchange (ASX) Listing Rules. As such, Ore Reserve increases relating to three Pilbara iron ore deposits require the additional supporting information set out in this release and its appendices.

A full update of Ore Reserves and Mineral Resources is provided in the 2015 Annual Report.

As at the end of 2015, the estimated iron ore Ore Reserves increased by 309 Mt after depletion from mining. The increases in iron ore Ore Reserves have been delivered as part of the ongoing resource development drilling program designed to maintain Ore Reserves coverage ahead of mining depletion rates. Increases in Ore Reserves are reported for:

1.      Yandicoogina (Pisolite Ore) which has increased from 247 Mt to 642 Mt following the completion of Feasibility level studies within the Oxbow portion of the channel and Prefeasibility level studies for the Billiard South portion of the channel.
2.      Brockman 2 (Brockman ore) which has increased from 62 Mt to 93 Mt due to additional drilling, modelling and mine planning studies within the existing operations.
3.      West Angelas (Marra Mamba ore) which has increased from 185 Mt to 209 Mt due to the first time reporting of the Deposit F deposit following the completion of a Prefeasibility level study.

Ore Reserves are quoted on a 100% basis.

The location of the three deposits discussed are shown in Figure 1.

Page 1 of 12


 

 

Summary of information to support the Ore Reserves estimates

Yandicoogina

Increases in the Ore Reserve Estimates of the Yandicoogina deposit are supported by JORC Table 1 provided in Appendix 1 of this release and located at www.riotinto.com/JORC. The following summary of information for Mineral Resource Estimates is provided in accordance with Chapter 5.8 of ASX Listing Rules.

Geology and geological interpretation

The Yandicoogina deposit is located within the Hamersley Basin of Western Australia, which hosts some of the most significant iron ore deposits in the world. Mineralisation at the Yandicoogina occurs as pisolitic ores forming a Channel Iron Deposit (CID) overlying the Brockman Formation ores.

Geologic interpretations are supported by surface mapping of outcrops, and data collected from numerous percussion, reverse circulation and diamond drilling programs carried out between 1972 and 2015. In total, 915 holes are drilled into the Oxbow portion of the deposit and 1,744 holes are drilled into the Billiard South portion of the deposit.

Drilling techniques

Drilling at the Yandicoogina deposit was carried out by using diamond, percussion and reverse circulation drilling rigs. Geophysical logging was completed for the majority of the drill holes employing a suite of down hole tools to obtain calliper and gamma data to assist in the interpretation of the stratigraphy.

Sampling, sub-sampling method and sample analysis method

For the reverse circulation drilling, sub-sampling at the drill rig was carried out using static and rotary splitters. For diamond drilling, 1 metre samples were passed through a jaw crusher with a top size of 2 centimetres. A rotary splitter as then used to create an ‘A’ sub-sample with 40% of the sample by mass.

The sub-sample is then sent to independent and certified laboratories for analysis. At the laboratory, the sample is oven dried at 105 degrees celsius for a minimum of 24 hours. The sample is then crushed to approximately 3 millimetres using a Jaw Crusher and split to produce a sub-sample. The sub-sample is pulverised to 95 per cent of weight passing 150 µm. Fe, SiO2, Al2O3, P, Mn, MgO, TiO2, CaO and S are assayed using industry standard lithium metaborate fusion and X-Ray Fluorescence (XRF) analysis. Loss On Ignition (LOI) was determined using industry standard Thermo-Gravimetric Analyser.

Economic assumptions

Rio Tinto applies a common process to the generation of commodity price estimates (as an input into Ore Reserves) across the group. This involves generation of long-term price curves based on current sales contracts, industry capacity analysis, global commodity consumption and economic growth trends. In this process, a price curve rather than a single price point is used to develop estimates of mine returns over the life of the project. The detail of this process and of the price point curves is commercially sensitive and is not disclosed.

Criteria used for classification

Appropriate drill hole spacing criteria for classifying Mineral Resources within the Pilbara is based on an understanding of the geological and grade variability, and reconciliation of operating mines across the Pilbara area. Typically, a Measured Resource would have a drill spacing 100 metre x 50 metre at Yandicoogina.

Estimation methodology

Page 2 of 12


 

Modelling was completed using the Rio Tinto Iron Ore Pilbara geological modelling and estimation standards. Ordinary Kriging were used to estimate grades through the deposits.

Mining and recovery factors

The Mineral Resource model was regularised to a block size which was determined to be the selective mining unit following an analysis of a range of selective mining units. Dilution and mining recovery were modelled by applying the regularisation process to the sub-block geological model.

Metallurgical models were applied to the regularised model in order to model product tonnage, grades and yields.

Detailed pit designs were developed, extending to the Limit of the CID, with due consideration of geotechnical, geometric and access constraints.

These pit designs were used as the basis for production scheduling and economic evaluation. Conventional mining methods (truck and shovel) similar to other Rio Tinto Iron Ore mines were selected. The mine has been designed to utilise in-pit crushing and conveying to transport ore to a central processing facility.

The geotechnical parameters have been applied based on geotechnical studies informed by assessments of diamond drill holes, specifically drilled for geotechnical purposes in the surrounding host rock.

Cut-off grades

The cut-off grade for high-grade ore is less than or equal to 1.9% Al2O3 and 6.5% SiO2

Processing

The Yandicoogina Oxbow mine has been designed with a dry crush and screen processing facility similar to processing facilities at the current Yandicoogina mining operation.

The Billiard South mine has been designed with wet/dry crush and screen processing facility similar to processing facilities at Yandicoogina mining operations, to process below water table high aluminous ore

The proposed metallurgical process is a well-tested and proven processing methodology, having been utilised at Rio Tinto Iron Ore mining operations for decades.

Modifying factors

The Yandicoogina deposits are located within existing tenure Mining Lease (ML)274SA, which was granted under the Iron Ore (Yandicoogina) Agreement Act 1996.

The Yandicoogina operation is well established with central administration and workshop facilities. The workforce currently operates on a Fly-in Fly-out (FIFO) model using the Barimunya airport. Process water will be sourced from groundwater abstracted through the mine dewatering process. Potable water will be sourced from the bore fields servicing the current Yandicoogina operation. Power supply will be derived from the existing distribution system at the Yandicoogina Operation, sourced from the Hamersley Iron power stations in Dampier and Paraburdoo.

Page 3 of 12


 

 

2015 Annual Report Ore Reserve Table, showing line items relating to Yandicoogina upgrade

    Proved Ore reserves  Probable ore reserves  Total ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                       
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  Interest  Recoverable 
  (a)                  %  metal 
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Hamersley Iron (Australia)                       
- Yandicoogina (Pisolite ore HG) (b)  O/P  637  58.5  4  58.8  642  247  58.5  58.7  100.0  642 

 

(a)      Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(b)      Hamersley Iron Yandicoogina (Pisolite ore HG) Reserves tonnes increased due to the inclusion of additional pits.

Page 4 of 12


 

Brockman 2

Mineral Resource Estimates of the Brockman 2 deposit are supported by JORC Table 1 provided in Appendix 2 of this release and located at www.riotinto.com/JORC. The following summary of information for Mineral Resource Estimates is provided in accordance with Chapter 5.8 of ASX Listing Rules.

Geology and geological interpretation

The Brockman 2 deposit is located within the Hamersley Basin of Western Australia, which hosts some of the most significant iron ore deposits in the world. Mineralisation at the Brockman 2 deposit occurs as hematite goethite within the Brockman Iron Formation and overlying detrital ores.

Geologic interpretations are supported by surface mapping of outcrops, and by a number of drilling programs. Reverse circulation drilling is the predominant form of drilling and totals 1,596 holes for 119,704 m. In addition to this 109 dual rotatory percussion and 18 diamond drill holes are available for geological interpretation, geotechnical and metallurgical assessments.

Drilling techniques

Drilling at the Brockman 2 deposit was carried out by using reverse circulation drilling rigs and dual rotary diamond drill rigs. Geophysical logging was completed for most drill holes employing a suite of down hole tools to obtain calliper and gamma and down hole density.

Sampling, sub-sampling method and sample analysis method

Sub-sampling at the drill rig was carried out using rotary splitters. The sample is then sent to independent and certified laboratories for analysis. At the laboratory, the sample is oven dried at 105 degrees celsius for a minimum of 24 hours. The sample is then crushed to approximately 3 millimetres using a Jaw Crusher and split to produce a 500 g sub-sample. The sub-sample is pulverised to 95 per cent of weight passing 150 µm. Fe, SiO2, Al2O3, P, Mn, MgO, TiO2, CaO and S are assayed using industry standard lithium metaborate fusion and X-Ray Fluorescence (XRF) analysis.

Economic assumptions

Rio Tinto applies a common process to the generation of commodity price estimates (as an input into Ore Reserves) across the group. This involves generation of long-term price curves based on current sales contracts, industry capacity analysis, global commodity consumption and economic growth trends. In this process, a price curve rather than a single price point is used to develop estimates of mine returns over the life of the project. The detail of this process and of the price point curves is commercially sensitive and is not disclosed.

Criteria used for classification

Appropriate drill hole spacing criteria for classifying Mineral Resources within the Pilbara is based on an understanding of the geological and grade variability, and reconciliation of operating mines across the Pilbara area. Brockman 2 is drilled at approximately 50 m x 50 m to 400 m x 200 m which is suitable for the classification of an Inferred, Indicated and Measured Mineral Resource.

Estimation methodology

Modelling was completed using the Rio Tinto Iron Ore Pilbara geological modelling and estimation standards. Ordinary kriging methods were used for the grade estimates.

Page 5 of 12


 

Mining and recovery factors

The Mineral Resource model was regularised to a block size which was determined to be the selective mining unit following an analysis of a range of selective mining units. Dilution and mining recovery were modelled by applying the regularisation process to the sub-block geological model.

Metallurgical models were applied to the regularised model in order to model products tonnage, grades and yields.

Pit optimisations utilising the Lerchs-Grosmann algorithm with industry standard software were undertaken. This optimisation utilised the regularised Mineral Resource model together with cost, revenue, and geotechnical inputs. The resultant pit shells were used to develop detailed pit designs with due consideration of geotechnical, geometric and access constraints.

These pit designs were used as the basis for production scheduling and economic evaluation. Conventional mining methods (truck and shovel) similar to other Rio Tinto Iron Ore mines were selected.

The geotechnical parameters have been applied based on geotechnical studies informed by assessments of diamond drill holes drilled during the 2011, 2012 & 2013 drilling programmes, specifically drilled for geotechnical purposes on the surrounding host rock.

Cut-off grades

A variable cut-off grade protocol to maximise the tonnages whilst maintaining product quality is applied at Brockman 2.

Processing

There are two existing dry crush and screen processing facilities and one existing wet de-sliming processing facility to which Brockman 2 ore could be fed. Product prediction regressions for both dry and wet processing routes are assigned to the designated domains and are based on the most appropriate available metallurgical data generated from PQ-3 cores, WDC, winzes and production data.

Modifying factors

The Brockman 2 deposit 100% owned by Hamersley Iron Proprietary Limited (100% Rio Tinto Limited), held under the Mining Lease ML4SA (section 110, 112, 113, 239 and 242) and the Exploration lease (E47/00031).

The Brockman 2 mine has significant infrastructure in place including rail and road access, shared airport and camp facilities shared with the Rio Tinto Iron Ore Brockman 4 deposit, central workshops and administrations buildings.

Page 6 of 12


 

2015 Annual Report Ore Reserve Table, showing line items relating to Brockman 2 upgrade

    Proved Ore reserves  Probable Ore reserves  Total Ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                       
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  Interest  Recoverable 
  (a)                  %  metal 
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Hamersley Iron (Australia)                       
- Brockman 2 (Brockman ore) (b)  O/P  47  62.5  46  62.1  93  62  62.3  62.8  100.0  93 

 

(a)      Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(b)      Hamersley Iron Brockman 2 (Brockman ore) Reserves tonnes increased due to the inclusion of additional pits, updated geological models and cut-off grade changes.

Page 7 of 12


 

West Angelas

Ore Reserve Estimate upgrades for the West Angelas deposit supported by JORC Table 1 (Section 4) documents provided in Appendix 3 of this release and located at www.riotinto.com/JORC . The following summary of information for Ore Reserve Estimates is provided in accordance with Chapter 5.9 of ASX Listing Rules.

Geology and Mineral Resources:

The West Angelas Deposit F is located within the Hamersley Basin of Western Australia, which hosts some of the most significant iron ore deposits in the world. Mineralisation at the deposit occurs as bedded mineralisation within the Marra Mamba Iron Formation.

Geological interpretations are supported by surface mapping of outcrops. Reverse Circulation (RC) drilling was carried out between 1998 and 2014 which total 1,526 holes for 134 857 m. Drilling through the area that defines the Ore Reserves is at 50 m x 50 m grid spacing or 100 m x 50 m grid spacing for the Proved and Probable Reserves respectively. In addition to the RC drilling, 42 diamond drill holes for 3,455 m has been carried out to provide geotechnical data, metallurgical test cores and bulk density measurements.

Reverse circulation holes have been sub-sampled using rotary splitters. Samples are then sent for analysis by independent assay laboratories. At the laboratory the sample is dried at 105 degrees celsius for a minimum of 24 hours. The sample is then crushed to approximately 3 mm using a Jaw Crusher and riffle split to produce a 500 g sub-sample. The sub-sample is pulverised to 95% of weight passing 150 µm. Fe, SiO2, Al2O3, P, Mn, MgO, TiO2, CaO and S are assayed using industry standard lithium metaborate fusion and X-Ray Fluorescence (XRF) analysis.

Modelling was completed using the Rio Tinto Iron Ore Pilbara geological modelling and estimation standards. Ordinary kriging methods were used for the grade estimates.

Economic assumptions

Rio Tinto applies a common process to the generation of commodity price estimates (as an input into Ore Reserves) across the group. This involves generation of long-term price curves based on current sales contracts, industry capacity analysis, global commodity consumption and economic growth trends. In this process, a price curve rather than a single price point is used to develop estimates of mine returns over the life of the project. The detail of this process and of the price point curves is commercially sensitive and is not disclosed.

Criteria used for classification

The stated Proved and Probable Ore Reserves directly coincide with the Measured and Indicated Mineral Resources, respectively. There are no Inferred stated reserve numbers. Typically, a 50 m x 50 m drill spacing will define a Measured Resource.

Mining and recovery factors

The Mineral Resource model was regularised to a block size which was determined to be the selective mining unit following an analysis of a range of selective mining units. Dilution and mining recovery were modelled by applying the regularisation process to the sub-block geological model.

Metallurgical models were applied to the regularised model in order to model products tonnage, grades and yields.

Page 8 of 12


 

Pit optimisations utilising the Lerchs-Grosmann algorithm with industry standard software were undertaken. This optimisation utilised the regularised Mineral Resource model together with cost, revenue, and geotechnical inputs. The resultant pit shells were used to develop detailed pit designs with due consideration of geotechnical, geometric and access constraints.

These pit designs were used as the basis for production scheduling and economic evaluation. Conventional mining methods (truck and shovel) similar to other Rio Tinto Iron Ore mines were selected.

Geotechnical design recommendations for the Pre-Feasibility Study have been supplied based on geotechnical studies informed by the assessment of seven fully cored and geotechnically logged diamond drill holes (totalling 694 m) drilled in 2014. The resultant design recommendations produce inter-ramp slope angles varying between 20 and 38 degrees depending on the local rock mass, hydrogeology, and structural geological conditions.

Cut-off grades

The cut-off grade for high-grade Marra Mamba ore is greater than or equal to 58% Fe.

Processing

The West Angelas mine has been designed to be processed with the existing dry crush and screen processing facility at the West Angelas Operations.

Modifying factors

The West Angelas Deposit F deposits are located within existing tenure Mineral Lease (ML) 248SA, which was granted under the Iron Ore (Robe River) Agreement Act 1964.

Significant existing infrastructure is in place for the West Angelas deposits including road, rail, airport, camp facilities, central processing plants, central workshops and administration offices. Ore will be railed to Rio Tinto’s ports at Dampier and Cape Lambert.

 

 

Page 9 of 12


 

2015 Annual Report Ore Reserve Table, showing line items relating to West Angelas upgrade

    Proved Ore reserves  Probable ore reserves  Total ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                       
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  Interest  Recoverable 
  (a)                  %  metal 
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Robe River JV (Australia)                       
- West Angelas (Marra Mamba ore) (b)  O/P  153  62.0  55  60.0  209  185  61.4  61.5  53  111 

 

(a)      Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(b)      Robe River JV West Angelas (Marra Mamba ore) Reserves tonnes increased due to the addition of a new pit, updated geological models and pit design modifications.

 

Page 10 of 12

 


 

Notice to ASX

 

Competent Persons Statement

The information in this report that relates to Mineral Resources is based on information compiled by Bruce Sommerville, a Competent Person who is a Fellow of The Australasian Institute of Mining and Metallurgy.

The information in this report that relates to Ore Reserves is based on information compiled by Mr An Do, a Competent Person who is a Member of The Australasian Institute of Mining and Metallurgy.

Mr Sommerville and Mr Do are full-time employees of the company.

Mr Sommerville and Mr Do have sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity being undertaken to qualify as Competent Persons as defined in the 2012 Edition of the ‘Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves’. Mr Sommerville and Mr Do consent to the inclusion in the report of the matters based on the information in the form and context in which it appears.

 

 

 

 

 

 

Page 11 of 12


 

 

Contacts

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Appendix 1

Yandicoogina Oxbow & Billiard South Table 1

The following table provides a summary of important assessment and reporting criteria used at the Yandicoogina Oxbow & Billiard South deposit for the reporting of exploration results, Mineral Resources and Ore Reserves in accordance with the Table 1 checklist in The Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2012 Edition). Criteria in each section apply to all preceding and succeeding sections.

A summary of the Ore Reserve estimate for Yandicoogina is provided at the end of this document

SECTION 1 SAMPLING TECHNIQUES AND DATA

Criteria  Commentary 
Sampling    Samples for geological logging, assay, geotechnical, metallurgical and density test work are 
techniques    collected via drilling at Yandicoogina Oxbow & Billiard South deposit. 
    Drilling for collection of samples for assay is conducted on a 100 m × 50 m regularly spaced 
    grid (100 m along channel × 50 m across channel). Samples are collected at 1 m intervals. 
    All reverse circulation drilling utilises a static and rotary cone splitter beneath a cyclone 
    return system for sample collection. The rotary cone splitter used in most recent holes 
    produces two 8% samples (‘A’ and ‘B’) and one 84% reject sample.
    All diamond core drilling uses triple-tube sampling; HQ-3 (61.1 mm core diameter) and PQ-3 
    (83.0 mm core diameter). 
    Grade, geotechnical and density samples are collected via diamond core drilling of HQ-3 core. 
    Metallurgical, density and grade twin samples are collected via diamond core drilling of PQ-3 
    core. 
    Diamond core is crushed to -6 mm and split at site prior to submitting to laboratory for 
    further sample reduction. 
    Dry bulk density is derived from accepted gamma-density data collected at 10 cm intervals 
    from down-hole geophysical sondes. Density measured from accepted gamma-density is 
    corrected for moisture from diamond drill core twinned with reverse circulation drilling. 
    Mineralisation is determined by a combination of geological logging and assay results. 
Drilling    Drilling is conducted predominantly by diamond core and reverse circulation (Refer to Section 
techniques    2, Drill hole Information, for a detailed breakdown of drilling by method and year). 
    1970’s drilling was open hole percussion. 
    1993 - 2008 drilling was by diamond core drilling methods. 
    Between 2009 - 2015 drilling is by a combination of diamond core and reverse circulation 
    drilling methods. 
    Pre-collars were drilled to the top of the weathered channel iron deposit (CID), or to refusal in 
    the alluvial blanket, using a tri-cone roller bit or a dual rotary (DR) drill. Pre-collars were then 
    reamed where necessary, sleeved with a PVC collar and the remainder of the hole drilled 
    using HQ-3 wire-line drilling techniques with 1.5 m steel triple tubes for coring within 3 m 
    barrels. 
    A majority of drill holes are oriented vertically. A small number of angled holes were drilled 
    where appropriate, such as on channel margins and for geotechnical purposes. 
Drill sample    No direct recovery measurements are performed on reverse circulation samples. Sample 
recovery    weights are recorded from laboratory splits and the recovery at the rig is visually estimated 
    for loss per drilling interval. 
    Diamond core recovery is maximised via the use of triple-tube sampling and additive drill 
    muds. 
    Sample recovery in some friable mineralisation may be reduced however it is unlikely to have 
    a material impact on the reported assays for these intervals. 
    Diamond core recovery is recorded using rock quality designation (RQD) measurements with 
    all cavities and core loss recorded in the Rio Tinto Iron Ore acQuire™ database. 
    Diamond core recovery was measured during each of the drill programs post 2002. Total 
    core recovery for Oxbow (excluding cavities) was 98.5% for mineralised strands. Total core 
    recovery for Billiard South (excluding cavities) was 98.6% for mineralised strands. 
Logging 

 

All the drill holes are geologically logged utilising standard Rio Tinto Iron Ore Material Type 
    Classification Scheme logging codes. 

 


 

    Geological logging is performed on 1 m intervals after examination of drill core or drill
    cuttings. 
    In 2014 and 2015 bulk logging was conducted on reverse circulation drill holes at Billiard
    South, where the majority material type is recorded.
    All drill holes are logged using downhole geophysical tools for gamma trace, calliper, gamma
    density, resistivity, and magnetic susceptibility since 2002 at Oxbow and since 2004 at
    Billiard South. 
Sub-sampling  Sub-sampling technique: 
techniques and   

 

Diamond core drilling:
sample     

o 

Samples are collected at 1 m intervals. Following logging, photography, and oven
preparation        drying, samples are passed through a jaw crusher resulting in a top size of 1 - 2 cm.
        The sample is then passed through a rotary splitting device at a minimum rate of 20
        revolutions per sample to produce the following splits:
        §

‘A’ Split - Analytical sample – 40%

        §

‘B’ Split - Retention sample – 20%

        §

Waste or composited to nominal 10 m intervals for metallurgical test work

         

– 40%

   

 

Reverse circulation drilling:
     

o  

Samples are collected at a 1m interval and sub sampled using a rotary cone
        splitter, rotating at a nominal 20-30 RPM, beneath a cyclone return system and
       

produces approximate splits of:

          §

‘A’ Split - Analytical sample – 8%

          §

‘B’ Split - Retention sample – 8%

          §

Bulk reject – 84%

  Sample preparation: 
 

 

The ‘A’ Splits are then submitted to laboratory to undertake the following sample preparation
    process:   
      o  Dry at 105° C 
      o  Crushed to -3 mm using Boyd crusher and splitting through linear splitting device to
        capture 1 – 2.5 kg samples.
      o  Robotic LM5 used to pulverise total sample (1 – 2.5 kg) to 90% passing 150 micron
        sieve. 
      o  A 100 gram sub sample collected for analysis.
Quality of assay  Assay methods: 
data and    An X-Ray Fluorescence (XRF) analysis conducted to determine :
laboratory tests     

o 

Fe, SiO2 , Al2 O3 , TiO2 , Mn, CaO, P, S, MgO, K2 O, Zn, Pb, Cu, Ba, V, Cr, Cl, As, Ni, Co,
        Sn, Sr, Zr, Na
    Loss on Ignition (LOI) was determined using industry standard Thermo-Gravimetric Analyser
    (TGA) 
      o  Pre 2004:   
       

§

LOI was measured at 371° C, 538° C, and 900° C.

      o  2004 - 2011: 
       

§

LOI was measured at three steps of temperatures: 140° - 425° C, 425° -

         

650° C, 650° - 1000° C. 

    2002 – Samples were sent to the Rio Tinto internal Dampier Laboratory.
    2004 – 2005 – Samples were sent to the Rio Tinto internal Yandi Laboratory.
    2003 and 2005 - 2015 – Samples were sent to Ultra Trace Laboratories in Perth for sample
    preparation and analytical testing.
  Quality assurance measures include:
    Insertion of coarse reference standard by Rio Tinto geologists at a rate of one in every 30
    samples in mineralised zones and one in every 60 samples in waste zones with a minimum of
    one standard per drill hole. Reference material is prepared and certified by Rio Tinto Iron Ore
    following ISO 3082:2009 (Iron Ores – Sampling and sample preparation procedures) and ISO
    9516-1:2003 (Iron Ores – Determination of various elements by X-ray fluorescence
    spectrometry – Part 1: Comprehensive procedure).
    Coarse reference standards contain a trace of strontium carbonate that is added at the time
    of preparation for ease of identification.
    Field duplicates were collected by sacrificing a ‘B’ split retention sample directly from the rig
    splitter. Duplicate insertion occurred at a frequency of one in 20. Trace zinc is included in the
    duplicate sample for later identification.
    At a frequency of one in 20, -3 mm splits and pulps were collected as laboratory splits and
     repeats respectively. These sub-samples were analysed at the same time as the original

2


 

   

sample to identify grouping, segregation and delimitation errors.

   

Internal laboratory quality assurance and quality control measures involve the use of internal 

   

laboratory standards using certified reference material in the form of pulps, blanks and 

   

duplicates were inserted in each batch. 

   

Random re-submission of pulps at an external laboratory is performed following analysis. 

   

Analysis of the performance of certified standard and field duplicates has indicated an 

   

acceptable level of accuracy and precision with no significant bias.

Verification of   

At Billiard South, approximately one in ten reverse circulation drill holes were twinned with 

sampling and   

diamond core drilling in 2014 and 2015. Comparison of reverse circulation and twinned 

assaying   

diamond drill core assay data distributions show that the drilling methods have similar grade 

   

distributions, verifying the suitability of reverse circulation samples in the Mineral Resource 

   

estimate. 

   

No twinned drilling has taken place at Oxbow. 

   

Data was returned electronically from Ultra Trace laboratories in Perth. All data is transferred 

   

to an acQuire™ database. 

   

Written procedures outline the processes of geological logging and data importing, quality 

   

assurance and quality control validation and assay importing, etc. A robust, restricted-access 

   

database is in place to ensure that any requests to modify existing data go through 

   

appropriate channels and approvals, and that changes are tracked by date, time, and user. 

Location of data   

All drill hole collar locations at the Yandicoogina Oxbow and Billiard South deposits are 

points   

surveyed using Geocentric Datum of Australia 1994 (GDA94) and Map Grid of Australia 1994 

   

(MGA94) zone 50 using a Trimble RTK Global Positioning System survey equipment. The 

   

accuracy of this system is to within six to 10 cm. 

   

Oxbow - All drilling was vertical and no down-hole surveys were conducted. Down-hole 

   

samples are located on traces assumed to be vertical. 

   

Billiard South - Down hole survey includes the collar set-up survey, down hole magnetic 

   

surveys and gyroscopic surveys (on angled holes or >~100 m) with data uploaded to the 

   

acQuire™ database. 

Data spacing   

Drill spacing of approximately 100 m × 50 m (100 m along the channel × 50 m across the 

and distribution   

channel). 

   

The drill spacing is deemed appropriate for sufficient deposit knowledge by the Competent 

   

Person for the Mineral Resource classification applied. 

   

The mineralised domains for the Yandicoogina Oxbow & Billiard South deposit have 

   

demonstrated sufficient continuity in both geology and grade to support the definition of 

   

Mineral Resources, and the classifications applied under the 2012 JORC Code guidelines. 

Orientation of   

Drill lines run perpendicular to the channel, and subsequently change through 90° as the 

data in relation   

channel meanders. 

to geological   

Drilling is predominantly vertical, which is appropriate for the sub-horizontal stratigraphy of 

structure   

the majority of the deposit. 

   

A small number of angled holes were drilled where appropriate, such as on the channel 

   

margins, for geotechnical purposes. 

Sample security   

Analytical samples (A splits) are collected by field assistants, placed onto steel sample racks, 

   

and transported to Ultra Trace Laboratories in Perth, Western Australia for analyses. 

   

Retention samples (B Splits) are collected and stored in drums.

   

Assay pulps are retained indefinitely at Laboratories and external storage facilities at CTI 

   

Logistic. 

Audits or   

No external audits have been performed. 

reviews   

Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 

   

have been completed. These reviews concluded that the fundamental data collection 

   

techniques are appropriate. 

 

SECTION 2 REPORTING OF EXPLORATION RESULTS

 
Criteria 

Commentary 

Mineral    100% owned by Hamersley Iron-Yandi Pty Limited (HIY), 100% Rio Tinto Limited, held under 
tenement and    Mining Lease (ML) 274SA. 
land tenure     
status     

3


 

Exploration    Drilling was conducted by CSR Ltd. at Yandicoogina between 1972 – 1978. The Yandicoogina
done by other    deposit was acquired from CSR Ltd. by CRA in 1987.   
parties    Mining Lease (ML) 274SA was granted to Hamersley Iron-Yandi Pty Limited (HIY) in October,
    1998.
Geology    The deposit is a channel iron deposit incised into the Lower Proterozoic Weeli Wolli Formation.
    The bedded mineralisation is generally overlain by a variable thickness zone of Quaternary
    alluvium/colluvium.       
Drill hole                 
Information                 
          Oxbow  Billiard South
      Year          
          No. of Holes  Type of Drilling  No. of Holes  Type of Drilling
      1972   2  Percussion  -  -
      1974   11  Percussion  -  -
      1977   1  Percussion  17  Percussion
      1978       12  Percussion
      1993   19  Diamond  -  -
      1999       4  Diamond
      2002   6  Diamond  -  -
      2003   108  Diamond  19  Diamond
      2004   8  Diamond  111  Diamond
      2005   376  Diamond  48  Diamond
      2006   -  -  144  Diamond
      2007   -  -  172  Diamond
      2008   -  -  132  Diamond
      2009         Diamond
                (398), DR 
          -  -  424   
                (16) & RC 
                (10) 
      2010   8  Diamond  235  Diamond
      2011   376  Diamond  -  -
      2014         Diamond
          -  -  422  (45) & RC 
                (377) 
      2015   -  -  30  RC
      Total   915  -  1,744  -
      All drilling data has been used for geological interpretation.   
     

No data pre - 2002 has been used in the Mineral Resource estimate due to concerns

      regarding sample quality. 
Data    No data aggregation. All diamond core samples collected at 1 m intervals.
aggregation    No grade truncations are performed.     
methods     
Relationship    Down-hole lengths are reported that are essentially true width due to vertical drilling and
between    gently folded, horizontal strata. 
mineralisation     
widths and     
intercept     
lengths     

4


 


5


 


6


 

Balanced  Not applicable as Rio Tinto has not specifically released exploration results for this deposit. 
reporting     
Other  Geological surface mapping has been collected at 1:10,000 scale in 1997. 
substantive   Approximately 75% of the Mineral Resource lies below the water table at Oxbow and 98% of 
exploration   

the Mineral Resource lies below the water table at Billard South. 

data     
Further work  Further infill reverse circulation drilling is planned along channel margins. 

 

7


 

SECTION 3 ESTIMATION AND REPORTING OF MINERAL RESOURCES

Criteria  Commentary 
Database    All drilling data is securely stored in an acQuire™ geoscientific information management 
integrity    system managed by a dedicated team within Rio Tinto. The system is backed up nightly on 
    servers in Perth, Western Australia. The backup system has been tested in 2015, 
    demonstrating that it is effective. 
    The drilling database used for Mineral Resource estimation has been internally validated by 
    Rio Tinto Iron Ore personnel by the following methods: 
    o  acQuire™ scripts for relational integrity, duplicates, total assay and missing / blank 
      assay values 
    o  Grade ranges in each domain 
    o  Domain names and tags 
    o  Null and below detection limit grade values 
    o  Missing or overlapping intervals 
    o  Duplicate data 
    Drill hole data is also validated visually by domain to the geological model. 
Site visits    The Competent Person has regularly visited Yandicoogina Oxbow & Billiard South between 
    2011 and 2015. There were no outcomes as a result of these visits.
Geological    Overall the Competent Person’s confidence in the geological interpretation of the area is 
interpretation    good, based on the quantity and quality of data available, and the continuity and nature of the 
    mineralisation. 
    Geological modelling was undertaken by Rio Tinto geologists. The method involves 
    interpretation of down-hole stratigraphy using surface geological mapping, lithological 
    logging data, down-hole gamma data, and assay data. 
    Cross-sectional interpretation of each stratigraphic unit is performed followed by 
    interpretation of mineralisation boundaries. Three-dimensional wireframes of the sectional 
    interpretations are created to produce the geological model. 
    Mineralisation is continuous. It is affected by stratigraphy, structure and weathering. The drill 
    hole spacing is sufficient to capture density, grade and geology variation for Mineral Resource 
    reporting. 
    The geological model is sub-divided into domains and both the composites and model blocks 
    are coded with these domains. 
Dimensions    The mineralisation is part of the Yandicoogina Channel Iron Deposit. 
    The Yandicoogina Oxbow deposit extends 4.5 km along strike. The paleochannel is saucer- 
    shaped in cross section and between 450 m and 750 m wide. The main ore zone is 40 - 50 m 
    thick in the centre of the channel, thinning towards the margins.
    The Yandicoogina Billiard South deposit extends 7.4 km along strike. The paleochannel is 
    saucer-shaped in cross section and between 450 m and 850 m wide. The main ore zone is 40 
    - 60 m thick in the centre of the channel, thinning towards the margins. 
Estimation and    The estimation process was completed in Maptek Vulcan software. 
modelling    Mineralised domains were estimated by ordinary kriging and non-mineralised domains were 
techniques    estimated by inverse distance weighting to the first power. 
    A block size of 25 m (X) × 25 m (Y) × 5 m (Z) was used for parent blocks. Parent blocks are 
    sub-celled to the geological boundaries to preserve volume. 
    All domains were estimated with hard boundaries applied. 
    Statistical analysis was carried out on data from all domains. High yield limits were applied to 
    TiO2 for the mineralised domains within Oxbow; and Mn within GVL and, MgO and CaO for the 
    mineralised GVU and GVL domains within Billiard South. The limits differed for different 
    domains and were selected based on histograms and the spatial distribution of the respective 
    assay values. 
    Grades are extrapolated to a maximum distance of approximately 750 m from data points. 
    The block model was validated using a combination of visual, statistical, and multivariate 
    global change of support techniques in the absence of any production data. 
Moisture    All Mineral Resource tonnages are estimated and reported on a dry basis. 
Cut-off   

The criteria for Mineral Resources were that geology must either be mixed clay and pisolite or 

parameters    hard competent pisolite. 

 

8


 

Mining factors    Development of this Mineral Resource assumes mining using standard Rio Tinto Iron Ore 
or assumptions    equipment and methods similar to other Rio Tinto Iron Ore operations. The assumed mining 
    method is conventional truck and shovel open pit mining at an appropriate bench height. 
    Mining practices will include grade control utilising blast hole data.
Metallurgical    It is assumed that a mixture of dry and wet crush and screening processes used by Rio Tinto 
factors or    Iron Ore will be applicable for the processing of the Yandicoogina Oxbow and Billiard South 
assumptions    deposits. 
Environmental    Rio Tinto Iron Ore has an extensive environmental and heritage approval process. A detailed 
factors or    review of these requirements has been undertaken in a recent Feasibility Study. No issues 
assumptions    were identified that would impact on the Mineral Resource estimate. 
Bulk density    Gamma-density logs are collected from reverse circulation drill holes. 
    Dry core densities are generated via the following process: 
   

o 

The core volume is measured in the split and the mass of the core is measured and 
      recorded. 
    o  Wet core densities are calculated by the split and by the tray. 
    o  The maximum length of sample for each density measurement is 1.5 m. 
    o  Core recovery is recorded. 
    o  The core is then dried and dry core masses are measured and recorded. 
    o  Dry core densities are then calculated. 
    Density measured from accepted gamma-density logs is corrected for moisture from 
    diamond drill core twinned with reverse circulation drilling. 
    Dry bulk density was estimated using ordinary kriging in mineralised zones and inverse 
    distance weighted to the first power in waste zones. 
Classification    The model has been classified into the categories of Measured, Indicated and Inferred. The 
    determination of the applicable resource category has considered the average data density 
    for the respective domains, the interpreted geological continuity and the estimation 
    statistics. 
    The Competent Person is satisfied that the stated Mineral Resource classification reflects the 
    data spacing, data quality, level of geological continuity and the estimation constraints of the 
    deposits. 
Audits or    All stages of Mineral Resource estimation have undergone a documented internal peer review 
reviews    process, which has documented all phases of the process. 
Discussion of    Rio Tinto Iron Ore operate multiple mines in the Pilbara region of Western Australia. The 
relative    Mineral Resource data collection and estimation techniques used for Yandicoogina Oxbow 
accuracy/    and Billiard South are consistent with those applied at other deposits which are being mined. 
confidence    Reconciliation of actual production with the Mineral Resource estimates for individual 
    deposits is generally accurate to within ten percent for tonnes on an annual basis. This result 
    is indicative of a robust process. 
    The accuracy and confidence of the Mineral Resource estimate is consistent with the current 
    level of study (Feasibility). 

9


 

SECTION 4 ESTIMATION AND REPORTING OF ORE RESERVES

Criteria 

Commentary 

Mineral    The Billiard South Mineral Resource estimate was generated in 2015, incorporating 1,722 
Resource    drill holes for grade on a final drilling grid of 100 m x 50 m. The grade and density estimates 
estimate for    were generated using geostatistical spatial analysis and Ordinary Kriging for the mineralised 
conversion to    domains. 
Ore Reserves    The Oxbow Mineral Resource estimate was generated in 2012, incorporating 514 drill holes 
    for grade on a final drilling grid of 100 m x 50 m. The grade and density estimates were 
    generated using geostatistical spatial analysis and Ordinary Kriging for the mineralised 
    domains. 
    The most recent Mineral Resource estimates together with the latest update of pit designs 
    were used for reporting Ore Reserves. 
    The declared Ore Reserves are for the Yandicoogina Billiard South and Oxbow deposits. 
    Mineral Resources are reported additional to Ore Reserves. 
Site visits    The Competent Person has visited Yandicoogina in 2014. 
Study status    The Oxbow Feasibility study was completed in 2015. 
    The Billiard South Pre-Feasibility Study was completed in 2015 and the Feasibility Study is in 
    progress. 
Cut-off    The cut-off grade for high-grade ore is less than or equal to 1.9% Al2 O3 and 6.5% SiO2. 
parameters     
Mining factors    The Mineral Resource model was regularised to a block size of 25 m E × 25 m N × 5 m RL, 
or assumptions    which was determined to be the selective mining unit following an analysis of a range of 
    selective mining units. Dilution and mining recovery were modelled by applying the 
    regularisation process to the sub-block geological model. 
    Metallurgical models were applied to the regularised model in order to model products 
    tonnage, grades and plant yields. 
    The pit design is extended to the limit of the channel iron deposit (CID) with due 
    consideration of geotechnical, geometric and access constraints. The pit design was used as 
    the basis for production scheduling and economic evaluation. 
    Conventional truck and shovel mining methods, similar to the existing Yandicoogina 
    operation and other Rio Tinto Iron Ore mines, were selected. The mine has been designed to 
    utilise trucks to transport ore to central processing facilities. 
    Geotechnical design recommendations have been supplied based on geotechnical studies 
    informed by the assessment of seven fully cored and geotechnically logged diamond drill 
    holes in Oxbow, and seven fully cored and geotechnically logged diamond drill holes in 
    Billiard South, both drilled in 2014. This site specific data was supplemented by 19 fully cored 
    and geotechnically logged diamond drill holes from across adjacent Yandicoogina deposits 
    (Junction Central, Junction South West, Junction South East and Billiard South), in 2009, 
    2010 and 2014 and were also supported by rock strength and RQD information from 38 
    diamond resource geology holes drilled at Oxbow. 
    The resultant design recommendations are to follow the Basal Clay Conglomerate (BCC) 
    (contour mining) up to a dip of 30 degrees, and then a typical batter berm configuration with 
    inter ramp slope angles varying between 32 and 43 degrees, depending on the local rock 
    mass and structural geological conditions. 
    During the above process, Inferred Mineral Resources were excluded from mine schedules 
    and economic valuations utilised to validate the economic viability of the Ore Reserves. 
    The Oxbow Feasibility and Billiard South Pre-Feasibility Studies considered infrastructure 
    requirements associated with the conventional truck and shovel mining operation including 
    crushing and conveying systems, dump & stockpile locations, maintenance facilities, access 
    routes, explosive storage, water and power. 
Metallurgical 

Oxbow 

factors or    The Oxbow mine has been designed with a dry crush and screen processing facility similar to 
assumptions    existing processing facilities at Yandicoogina mining operations. The alternative processing 
    technologies are available for Oxbow; however this has been excluded from this Ore Reserve 
    declaration. 
    Metallurgical core processing followed a well-tested and proven processing methodology that 
    has been utilised for Rio Tinto Iron Ore Yandicoogina process design purposes for decades. 
    During drill campaigns in 2011, a total of 500 m of metallurgical PQ-3 diamond core was 
    drilled. This core formed the basis for metallurgical test work, which informed the study for 
    the design of the processing facility and metallurgical models. The map below show the 
    location of these drill holes. 

10


 

 

 

The diamond drill core test results were utilised to develop metallurgical models 
    representing upper and lower ore domains and were considered representative of the ore 
    body. The metallurgical models predict plant yield, product tonnage and grade parameters 
    for fines product. 
 

Billiard South 

    The Billiard South mine has been designed with wet/dry crush and screen processing facility 
    similar to processing facilities at Yandicoogina mining operations, to process below water 
    table high aluminous ore. 
    Metallurgical core processing followed a well-tested and proven processing methodology that 
    has been utilised for Rio Tinto Iron Ore Yandicoogina process design purposes for decades. 
    During drill campaigns in 2011 and 2014 a total of 1800 m of metallurgical PQ-3 diamond 
    core was drilled. This core formed the basis for metallurgical test work, which informed the 
    study for the design of the processing facility and metallurgical models. The map below show 
    the location of these drill holes. 

 

11


 

    The diamond drill core test results were utilised to develop metallurgical models 
    representing upper and lower ore domains and were considered representative of the ore 
    body. The metallurgical models predict plant yield, product tonnage and grade parameters 
    for fines products. 
Environmental    The Oxbow (west) deposit is approved under the Western Australian Environmental 
    Protection Act 1986 and the Commonwealth Environment Protection and Biodiversity 
    Conservation Act 1999. Approval for Oxbow (east) is being sought as a non-significant 
    amendment to the existing environmental approvals and is underway. 
    Hamersley Iron – Yandi Pty Limited referred the Yandicoogina Pocket-Billiard South project to 
    the WA Environmental Protection Authority and has been given a level of assessment of a 
    Public Environmental Review under section 38 of the Environmental Protection Act 1986. The 
    project is currently undergoing an environmental impact assessment. The Proposal was also 
    referred to the Commonwealth and determined to be a ‘not controlled’ action under the 
    Commonwealth Environment Protection and Biodiversity Conservation Act 1999. Therefore 
    no further federal environmental assessment is required. 
    A geochemical risk assessment has been completed for the project. The assessment 
    encompasses all material types present at the site, and tests have been conducted in 
    accordance with industry standards. Mining operations at the project pose a low acid mine 
    drainage risk based on current pit designs and the assessment of samples from within the pit 
    locations. 
Infrastructure    Access to the site is well established from the Great Northern Highway. 
    Ore will be railed to Rio Tinto’s ports at Dampier and Cape Lambert. The port and railway 
    networks have sufficient capacity to accommodate ore supply from the site. 
    A central hub for all non-process support facilities is located close to the existing Junction 
    Central (JC) pit for ease of access. It is located centrally to the processing plant and 
    accommodation precinct. 
    The Yandicoogina Explosive Facility is located east of the JC pit and is similar to those 
    constructed at other Rio Tinto Iron ore projects in the Pilbara, Western Australia. 
    The Yandicoogina operation is well established with central administration and workshop 
    facilities at JC. The workforce currently operates on a Fly in Fly out (FIFO) model using the 
    Barimunya airport located to the north. 
    Process water will be sourced from groundwater abstracted through the mine dewatering 
    process. Potable water will be sourced from the bore fields servicing the current 
    Yandicoogina operation. 
    Power supply will be derived from the existing distribution system at the Yandicoogina 
    Operation, sourced from the Hamersley Iron power stations in Dampier and Paraburdoo. 
    The existing fuel storage and handling facilities at the site will be upgraded to service the 
    project mining operations. 

12


 

    The site operation is well established with a permanent village. 
Costs    The capital costs are based on relevant Engineering Studies utilising experience from the 
    construction of existing, similar Rio Tinto Iron Ore projects in the Pilbara, Western Australia. 
    Operating costs were benchmarked against similar operating Rio Tinto Iron Ore mine sites. 
    Exchange rates were forecast by analysing and forecasting macro-economic trends in the 
    Australian and World economy. 
    Transportation costs were based on the existing operating experience at Rio Tinto Iron Ore 
    mine sites in the Pilbara, Western Australia. 
    Allowances have been made for royalties to the Western Australian government and other 
    private stakeholders. 
Revenue factors    Rio Tinto applies a common process to the generation of commodity price estimates across 
    the group. This involves generation of long-term price curves based on current sales 
    contracts, industry capacity analysis, global commodity consumption and economic growth 
    trends. In this process, a price curve rather than a single price point is used to develop 
    estimates of mine returns over the life of the project. The detail of this process and of the 
    price point curves is commercially sensitive and is not disclosed.
Market    The supply and demand situation for iron ore is affected by a wide range of factors, and as 
assessment    iron and steel consumption changes with economic development and circumstances. Rio 
    Tinto Iron Ore delivers products aligned with its Mineral Resources and Ore Reserves; these 
    products have changed over time and successfully competed with iron ore products supplied 
    by other companies. 
Economic    Economic inputs such as foreign exchange rates, carbon pricing, and inflation rates are also 
    generated internally at Rio Tinto. The detail of this process is commercially sensitive and is 
    not disclosed. 
    Sensitivity testing of the Yandicoogina Ore Reserves using both Rio Tinto long-term prices 
    and a range of published benchmark prices demonstrates a positive net present value for the 
    project sufficient to meet Rio Tinto Limited investment criteria.
Social    The Yandicoogina deposits are located within existing tenure Mining Lease (ML) 274SA, 
    which was granted under the Iron Ore (Yandicoogina) Agreement Act 1996. 
    The Yandicoogina deposits and associated infrastructure are located within the Shire of East 
    Pilbara, who has been informed of the proposal to develop the deposits. 
Other    Semi-quantitative risk assessments have been undertaken throughout the Oxbow and 
    Billiard South study phases, no critical naturally occurring risks have been identified through 
    the above mentioned risk management processes. 
Classification    The Billiard South Ore Reserves consist of 100% Proved Reserves. 
    The Oxbow Ore Reserves consist of 100% Proved Reserves. 
    The Competent Person is satisfied that the stated Ore Reserve classification reflects the 
    outcome of technical and economic studies. 
Audits or    No external audits have been performed. 
reviews    Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 
    have been completed. These reviews concluded that the fundamental data collection 
    techniques are appropriate. 
Discussion of    Rio Tinto Iron Ore operates multiple mines in the Pilbara region of Western Australia. The Ore 
relative    Reserve estimation techniques utilised for the Oxbow and Billiard South deposits are 
accuracy/    consistent with those applied at the existing operations. Reconciliation of actual production 
confidence    with the Ore Reserve estimate for individual deposits is generally within 10 percent for 
    tonnes on an annual basis. This result is indicative of a robust Ore Reserve estimation 
    process. 
    Accuracy and confidence of modifying factors are generally consistent with the current level 
    of studies (Billiard South Pre-Feasibility Study and Oxbow Feasibility Study). It is anticipated 
    that the modifying factors for Billiard South will be further refined during the Feasibility 
    Study, which is currently under way. 

13


 

2015 Annual Report Ore Reserve Table, showing line items relating to Yandicoogina upgrade

    Proved Ore reserves  Probable ore reserves  Total ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                       
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  Interest  Recoverable 
  (a)                  %  metal 
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Hamersley Iron (Australia)                       
- Yandicoogina (Pisolite ore HG) (c)  O/P  637  58.5  4  58.8  642  247  58.5  58.7  100.0  642 

 

(a)      Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(c)      Hamersley Iron Yandicoogina (Pisolite ore HG) Reserves tonnes increased due to the inclusion of additional pits.

 

 

14


 

Appendix 2

Brockman Syncline 2 – East Detrital - Table 1

The following table provides a summary of important assessment and reporting criteria used at the Brockman Syncline 2 – East Detrital deposit for the reporting of exploration results, Mineral Resources and Ore Reserves in accordance with the Table 1 checklist in The Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2012 Edition). Criteria in each section apply to all preceding and succeeding sections.

A summary of the Ore Reserve estimate for Brockman 2 is provided at the end of this document

SECTION 1 SAMPLING TECHNIQUES AND DATA

Criteria  Commentary 
Sampling    Samples for geological logging, assay, geotechnical, metallurgical and density test work are 
techniques    collected via drilling at Brockman Syncline 2 – East Detrital. 
    Drilling for collection of samples for assay is conducted on a North-South grid at 50 m × 50 m 
    collar spacing. All intervals are sampled. 
    All reverse circulation drilling utilises a static and rotary cone splitter beneath a cyclone 
    return system for sample collection. The rotary cone splitter used in most recent holes 
    produces two 8% samples (‘A’ and ‘B’) and one 84% reject sample.
    All diamond core drilling uses triple-tube sampling; HQ-3 (61.1 mm core diameter) and PQ-3 
    (83.0 mm core diameter). 
    Geotechnical and density samples are collected via diamond core drilling of HQ-3 core. 
    Metallurgical and density samples are collected from via diamond core drilling of PQ-3 core. 
    Dry bulk density is derived from accepted gamma-density data collected at 10 cm intervals 
    from down-hole geophysical sondes. Density measured from accepted gamma-density is 
    corrected for moisture from diamond drill core twinned with reverse circulation drilling. 
    Mineralisation is determined by a combination of geological logging and assay results. 
Drilling    Drilling is predominantly by reverse circulation with a lesser proportion of percussion and 
techniques    diamond drill core (Refer to Section 2, Drill hole Information, for a detailed breakdown of 
    drilling by method and year). 
    The majority of drilling is oriented vertically. 
    Geotechnical diamond core was oriented using the ACE orientation tool, which marks the 
    bottom of the core at the end of each run. 
Drill sample    No direct recovery measurements of reserve circulation samples are performed. Sample 
recovery    weights are recorded from laboratory splits and the recovery at the rig is visually estimated 
    for loss per drilling interval. 
    Diamond core recovery is maximised via the use of triple-tube sampling and additive drilling 
    muds. 
    Diamond core recovery is recorded using rock quality designation (RQD) measurements with 
    all cavities and core loss recorded in the Rio Tinto Iron Ore acQuire™ database. Overall 
    recovery from diamond drill core showed acceptable levels of recovery (>92%) for all holes. 
    Sample recovery in some friable mineralisation may be reduced; however it is unlikely to have 
    a material impact on the reported assays for these intervals. 
    Thorough analysis of duplicate samples performance does not indicate any chemical bias as a 
    result of inequalities in samples weights. 
Logging    All drill samples are geologically logged utilising standard Rio Tinto Iron Ore Material Type 
    Classification Scheme logging codes. 
    1986 - 1995: Geological logging was performed on 1.5 m intervals and on 2 m intervals 
    afterwards. 
    Since 2009, all drill holes are logged using downhole geophysical tools for gamma trace, 
    calliper, gamma density, resistivity, magnetic susceptibility. 
    Since 2013, acoustic and optical televiewer data are collected at select drill hole locations for 
    geological structural analyses. 
Sub-sampling 

Sub-sampling techniques: 

techniques and 

 

1986 – 1993: 
sample   

o 

Percussion drilling was sampled and logged on 1.5 m intervals. Two 1 kg sub 

preparation     

samples were collected for each 1.5 m interval by riffle splitting. Rig mounted 

     

cyclones and sample splitters were used. Wet samples collected in buckets or in a 

     
     

 


 

      wheel barrow placed below the cyclone.
 

 

1994 - 1995:
   

o 

Reverse circulation drilling samples were collected on 1.5 m intervals (1994 and
      1995) and on 2.0 m intervals (1995). Two sub samples were collected from a multi-
      level riffle splitter; one was the reference sample of 1 kg contained in a plastic jar
      with a sample tag placed inside the container. A second sample, used for chemical
      analysis, weighing approximately 5 kg was collected in a calico bag with the sample
      tag stapled on top of the bag.
    1996 - 2000:
   

o 

Reserve circulation drilling samples were collected on 2 m intervals with the sub
      sampling procedure the same as from 1994 - 1995.
    2001 - 2005:
   

o 

Reverse circulation drilling samples were collected on 2 m intervals. Sub samples
      were collected through a three-tiered riffle splitter. It produced approximate splits
      of:
     

§

‘A’ Split - Analytical sample – 12.5%
      § ‘B’ Split - Retention sample – 12.5%
      § Bulk reject – 75%
    2006 – 2014: 
   

o 

Reserve circulation drilling samples were collected on 2 m intervals. Sub sampling
      was carried out using a Rotating Cone Splitter rotating at a nominal 20 - 25 RPM,
      beneath a cyclone return system, produces approximate splits of:
      § ‘A’ Split - Analytical sample – 8%
      § ‘B’ Split - Retention sample –8%
      § Bulk reject – 84%
  Sample preparation:
    Pre 2000:
   

o 

Reserve circulation drilling samples were prepared by crushing the 5 kg drill sample
      to -3 mm. This was split to 200 – 300 g using a rotary splitter. The sample was dried
      for eight hours at 105° C and then pulverised in a ring mill to 95% passing a 100
      micron sieve for assay.
    2001-2014:
    o  ‘A’ split samples dried at 105° C.
    o  Sample crushed to -3 mm by Boyd crusher and splitting through linear splitting
      device to capture 1 – 2.5 kg samples.
    o  Robotic LM5 used to pulverise the total sample (1 – 2.5 kg) to 150 microns.
    o  A 100 gram sub sample collected for assay.
Quality of assay  Assay methods:
data and    An X-Ray Fluorescence (XRF) analysis is conducted to determine :
laboratory tests   

o 

Pre 2001 :
     

§

Fe, SiO2 , Al2 O3 , P, S, CaO, TiO, Mn and MgO
    o  2001 - 2014
     

§

Fe, SiO2 , Al2 O3 , TiO2 , Mn, CaO, P, S, MgO, K2 O, Zn, Pb, Cu, Ba, V, Cr, Cl, As,
        Ni, Co, Sn, Sr, Zr, Na
    Loss on Ignition (LOI) is determined using industry standard Thermo-Gravimetric Analyser
    (TGA) 
    o  Pre 2001 :
     

§

LOI was measured using a LECO TGA 500 analyser. For this, 1 to 2 g
        aliquot was ignited to 900° C until a dehydrated constant weight was
        achieved.
    o  2007 – 2010
     

§

LOI was measured at three steps of temperatures: 110° - 425° C, 425° -
        650° C, and 650° - 1000° C. 
    o  2011 – 2014
     

§

LOI was measured at three steps of temperatures: 140° - 425° C, 425° -
        650° C, 650° - 1000° C. 
    Pre 2000, samples were sent to the Rio Tinto internal Dampier Laboratory.
    2000 - 2012 samples were sent to Ultra Trace Laboratories in Perth for sample preparation
    and analytical testing.
    2013 - Present: samples are sent to ALS Laboratories in Perth for sample preparation and
    analytical testing.    
  Quality assurance measures include:
 

 

Insertion of coarse reference standards by Rio Tinto geologists at a rate of one in every 30

2


 

    samples in mineralised zones and one in every 60 samples in waste zones with a minimum of 
    one standard per drill hole. Reference material is prepared and certified by Rio Tinto Iron Ore 
    following ISO 3082:2009 (Iron Ores – Sampling and sample preparation procedures) and ISO 
    9516-1:2003 (Iron Ores – Determination of various elements by X-ray fluorescence 
    spectrometry – Part 1: Comprehensive procedure). 
    Coarse reference standards contain a trace of strontium carbonate that is added at the time 
    of preparation for ease of analytical detection. 
    Field duplicates are collected by using a ‘B’ split retention sample directly from the rig 
    splitter. Duplicate insertion occurred at a frequency of one in 20. Trace zinc is included in the 
    duplicate sample for later identification. 
    At a frequency of one in 20, -3 mm splits and pulps are collected as laboratory splits and 
    repeats respectively. These sub samples are analysed at the same time as the original 
    sample to identify grouping, segregation and delimitation errors.
    Internal laboratory quality assurance and quality control measures involve the use of internal 
    laboratory standards using certified reference material in the form of pulps, blanks and 
    duplicates were inserted in each batch. 
    Random re-submission of coarse splits and pulps at an external laboratory was performed as 
    part of Inter Laboratory Check Assay. 
    Analysis of the performance of certified standard and field duplicates has indicated an 
    acceptable level of accuracy and precision with no significant bias.
    Pre 1997 – No quality assurance and quality control processes were performed prior to 1997 
    at the time of drilling. Where logged geology from these drill holes was comparable with 
    more recent drilling, the sample assays were deemed valid and included in the Mineral 
    Resource estimate. 
Verification of    No twinned drilling has been conducted at Brockman Syncline 2 – East Detrital deposit. 
sampling and    Data was returned electronically from Ultra Trace and ALS laboratories in Perth. All data is 
assaying    transferred to an acQuire™ database. 
    An extensive quality control process is performed prior to accepting a batch of assay results 
    from the laboratory. 
    Written procedures outline the processes of geological logging and data importing, quality 
    assurance and quality control validation and assay importing, etc. A robust, restricted-access 
    database is in place to ensure that any requests to modify existing data go through 
    appropriate channels and approvals, and that changes are tracked by date, time, and user. 
Location of data    All drill hole collar locations at the Brockman Syncline 2 – East Detrital deposit are surveyed 
points    using Geocentric Datum of Australia 1994 (GDA94) and Map Grid of Australia 1994 (MGA94) 
    zone 50 using Differential Global Positioning System (DGPS) survey equipment. 
    Drill hole collar reduced level (RL) data is compared to detailed topographic maps and show 
    that the collar survey data is accurate. The topographic surface is based on 10 m grid 
    sampling of the 2008 Light Detecting and Ranging (LiDAR) survey, including spot heights 
    from DGPS drilling collars and is considered robust. 
Data spacing    Drill spacing is predominantly 50 m × 50 m (increases towards the eastern deposit margins 
and distribution    to 200 m × 200 m). 
    The drill spacing is deemed appropriate for sufficient deposit knowledge by the Competent 
    Person for the Mineral Resource classification applied. 
    The mineralised domains at Brockman Syncline 2 – East Detrital deposit have demonstrated 
    sufficient continuity in both geology and grade to support the definition of Mineral Resources, 
    and the classifications applied under the 2012 JORC Code guidelines. 
Orientation of    Drill lines are oriented North/South along the Brockman Mine grid and perpendicular to the 
data in relation    deposit strike. 
to geological    Drilling is predominantly vertical, however in areas of restricted access or to intersect 
structure    structures perpendicularly, angled holes were utilised. 
    Geotechnical drill holes were typically angled at -85° minimum on a 0° or 180° azimuth to be 
    perpendicular to drill lines. 
Sample security    Analytical samples (A splits) are collected by field assistants, placed onto steel sample racks, 
    and transported to Ultra Trace and ALS Laboratories in Perth, Western Australia for analyses. 
    Retention samples (B splits) are collected and stored in drums for two years at a Rio Tinto 
    Iron Ore Resource Evaluation camp located onsite. 
    Pulps are retained indefinitely at Laboratories and external storage facilities at CTI Logistics 
    located in Perth, Western Australia. 
Audits or    No external audits have been performed. 
    Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 

3


 

reviews   

have been completed. These reviews concluded that the fundamental data collection 

   

techniques are appropriate. 

 
 
SECTION 2 REPORTING OF EXPLORATION RESULTS
Criteria  Commentary 
Mineral    100% owned by Hamersley Iron Proprietary Limited (100% Rio Tinto Limited), held under the 
tenement and    Mining Lease ML4SA (section 110, 112, 113, 239 and 242) and the Exploration lease 
land tenure   

(E47/00031). 

status     
Exploration    There was no exploration completed on this ground by other parties. 
done by other     
parties     
Geology    The deposit contains both detrital and bedded-hosted iron mineralisation.   
    The detrital portion of the deposit is a Brockman Iron Formation-derived detrital iron deposit 
    overlying the bedded Dales Gorge Member of the Archean Brockman Iron Formation. 
    The bedded-hosted portion of the deposit contains iron mineralisation which occurs as a high- 
    phosphorus Brockman Iron deposit with a weathering overprint.     
Drill hole     
Information     
      Percussion  Diamond  Reverse Circulation 
    Year               
      # Holes   Metres  # Holes  Metres  # Holes  Metres 
    1986  93   4,089  -  -  -  - 
    1987  1   26  -  -  -  - 
    1993  15   1,104  -  -  -  - 
    1994  -   -  -  -  3  237 
    1995  -   -  -  -  30  1,707 
    1997  -   -  -  -  4  622 
    2009  -   -  -  -  11  1,720 
    2010  -   -  -  -  342  31,418 
    2011  -   -  -  -  389  28,566 
    2013  -   -  17  1,872  382  22,820 
    2014  -   -  1  54  435  32,614 
    Total  109   5,219  18  1,926  1,596  119,704 
 

 

All drilling data has been used for geological interpretation and Mineral Resource estimation. 
Data    No data aggregation. A majority of the reverse circulation samples are collected at 2 m 
aggregation    intervals (91%), no sample compositing was performed. 
methods    No grade truncations were performed. 
Relationship    Geometry of the mineralisation with respect to the drill hole angle is well-defined in most areas 
between    of the deposit. The strata are generally horizontal with slight folding and perceived true width is 
mineralisation    held consistent during geological interpretations. Down-hole interval lengths reported are 
widths and    essentially true width due to vertical drilling and gently dipping or horizontal strata. 
intercept     
lengths     

 

4


 


 

5


 

Balanced  Not applicable as Rio Tinto has not released exploration results for this deposit. 
reporting     
Other  Geological surface mapping has been conducted in 1976 at 1:12,000 scale and in 2013 - 2014 
substantive   

at 1:5,000 scale. 

exploration  Approximately 29% of the Mineral Resource lies below the water table. 
data     
Further work  Further infill reverse circulation drilling is planned to achieve a final designed drilling grid at 
   

50 m × 50 m spacing. 

6


 

SECTION 3 ESTIMATION AND REPORTING OF MINERAL RESOURCES

Criteria  Commentary 
Database    All drilling data is securely stored in an acQuire™ geoscientific information management 
integrity    system managed by a dedicated team within Rio Tinto Iron Ore. The system is backed up 
    nightly on servers located in Perth, Western Australia. The backup system has been tested in 
    2015, demonstrating that it is effective. 
    The drill hole database used for Mineral Resource estimation has been internally validated. 
    Methods include: 
    o  acQuire™ scripts for relational integrity, duplicates, total assay and missing / blank 
      assay values; 
    o  Grade ranges in each domain; 
    o  Domain names and tags; 
    o  Survey data down-hole consistency; 
    o  Null and negative grade values; 
    o  Missing or overlapping intervals; 
    o  Duplicate data. 
    Drill hole data is also validated visually by domain and compared to the geological model. 
Site visits    The Competent Person visited Brockman Syncline 2 - East Detrital deposit regularly between 
    2011 and 2015. There were no outcomes as a result of the most recent visit. 
Geological    Overall the Competent Person’s confidence in the geological interpretation of the area is 
interpretation    good, based on the quantity and quality of data available, and the continuity and nature of the 
    mineralisation. 
    Geological modelling was performed by Rio Tinto geologists. The method involves 
    interpretation of down-hole stratigraphy using surface geological mapping, lithological 
    logging data, down-hole gamma data, and assay data. 
    Cross-sectional interpretation of each stratigraphic unit is performed followed by 
    interpretation of mineralisation boundaries. Three-dimensional wireframes of the sectional 
    interpretations are created to produce the geological model. 
    Mineralisation is continuous. It is affected by stratigraphy, structure and weathering. The drill 
    hole spacing is sufficient to capture grade and geology changes at a large scale. 
    The geological model is sub-divided into domains and both the composites and model blocks 
    are coded with these domains. 
Dimensions    The mineralisation extends 10 km along strike in an East – West direction, up to 1 km 
    perpendicular to strike in a South - North direction and to a maximum depth of 230 m below 
    the current topographical surface. The hydrated and detrital domains are mostly continuous 
    with the pod-like bedded domains and the average depth varying.
Estimation and    The mineralised domains are estimated using ordinary kriging or inverse distance weighted to 
modelling    the second power and non-mineralised domains were estimated using inverse distance 
techniques    weighting to the first power or a scripted average of composited sample data. These methods 
    are appropriate for estimating the tonnes and grade of the reported Mineral Resources. 
    A block size of 12.5 m (X) × 12.5 m (Y) × 5 m (Z) was used for parent blocks. Parent blocks 
    are sub-celled to the geological boundaries to preserve volume.
    All domains were estimated with hard boundaries applied. 
    Statistical analysis was performed on data from all domains. 
    A high yield limit was used for manganese to restrict particular samples’ range of influence. 
    The limits differed for each domain and were selected based on the histograms and spatial 
    distribution of manganese. 
    The grade estimation process was completed using Maptek’s Vulcan software. 
    Grades are extrapolated between 250 m to 1,000 m from data points, depending on the 
    domain. 
    The block model was validated using a combination of visual, statistical, and multivariate 
    global change of support techniques. 
Moisture    All Mineral Resource tonnages are estimated and reported on a dry basis. 
Cut-off    The cut-off grade for high grade ore is greater than or equal to 60% Fe. 
parameters    The cut-off for Brockman Process Ore is 50% ≤ Fe < 60% and 3% < Al2 O3 < 6% (geology 
    domain must be Dales Gorge Member, Joffre or Footwall Zone). 
Mining factors    Development of this Mineral Resource assumes mining using standard Rio Tinto Iron Ore 

7


 

or assumptions    equipment and methods similar to other Rio Tinto Iron Ore operations. The assumed mining 
    method is conventional truck and shovel, open pit mining at an appropriate bench height. 
    Mining practices will include grade control utilising blast hole data.
Metallurgical    It is assumed that standard crushing and screening processes used by Rio Tinto Iron Ore will 
factors or    be applicable for the processing of the Brockman Syncline 2 – East Detrital deposit. 
assumptions     
Environmental    Rio Tinto Iron Ore has an extensive environmental and heritage approval process. No issues 
factors or    were identified that would impact on the Mineral Resource estimate. 
assumptions     
Bulk density    Gamma-density logs are collected from reverse circulation drill holes. 
    Dry core densities are generated via the following process: 
    o  The core volume is measured in the split and the mass of the core is measured and 
      recorded. 
    o  Wet core densities are calculated by the split and by the tray. 
    o  Core recovery is recorded. 
    o  The core is then dried and dry core masses are measured and recorded. 
    o  Dry core densities are then calculated. 
    Density measured from accepted gamma-density logs is corrected for moisture from diamond 
    drill core twinned with reverse circulation drilling. 
    Dry bulk density was estimated using ordinary kriging in mineralised zones and inverse 
    distance weighted to the first power in waste zones. 
Classification    The model has been classified into the categories of Measured, Indicated and Inferred. The 
    determination of the applicable Mineral Resource category has considered the average data 
    density for the respective domains, the interpreted geological continuity and the estimation 
    statistics. 
    The Competent Person is satisfied that the stated Mineral Resource classification reflects the 
    data spacing, data quality, level of geological continuity and the estimation constraints of the 
    deposits. 
Audits or    All stages of Mineral Resource estimation have undergone a documented internal peer review 
reviews    process, which has documented all phases of the process. 
Discussion of    Rio Tinto Iron Ore operates multiple mines in the Pilbara region of Western Australia. The 
relative    Mineral Resource data collection and estimation techniques used for Brockman Syncline 2 – 
accuracy/    East Detrital deposit are consistent with those applied at other deposits that are being mined. 
confidence    Reconciliation of actual production with the Mineral Resource estimates for individual 
    deposits is generally accurate to within ten percent for tonnes on an annual basis. This result 
    is indicative of a robust process. 
 
 
SECTION 4 ESTIMATION AND REPORTING OF ORE RESERVES
Criteria  Commentary 
Mineral    Initial generation of the modifying factors for this Ore Reserve estimate were based on a 
Resource    Mineral Resource estimate completed in April 2014. 
estimate for    The most recent Mineral Resource estimate together with the latest update of pit designs 
conversion to    were used for reporting Ore Reserves. 
Ore Reserves    The declared Ore Reserves are for the Brockman Syncline 2 - East Detrital Pit 8, Pit 11 & Pit 
    12.   
    Mineral Resources are reported additional to Ore Reserves. 
Site visits    The Competent Person visited Brockman Syncline 2 - East Detrital deposit in 2013. 
Study status    The Brockman Syncline 2 - East Detrital deposit is a brownfields expansion of existing 
    operations at Brockman Syncline 2. 
Cut-off    A variable cut-off grade is applied at Brockman Syncline 2 - East Detrital. 
parameters     
Mining factors    The Mineral Resource model was regularised to a block size of 12.5 m E × 12.5 m N × 10 m 
or assumptions    RL which was determined to be the selective mining unit following an analysis of a range of 

8


 

    selective mining units. Dilution and mining recovery were modelled by applying the 
    regularisation process to the sub-block geological model. 
    Metallurgical models were applied to the regularised model in order to model products 
    tonnage, grades and yields. 
    Pit optimisations utilising the Lerchs-Grosmann algorithm with industry standard software 
    were undertaken. This optimisation utilised the regularised Mineral Resource model together 
    with cost, revenue, and geotechnical inputs. The resultant pit shells were used to develop 
    detailed pit designs with due consideration of geotechnical, geometric and access 
    constraints. These pit designs were used as the basis for production scheduling and economic 
    evaluation. 
    Conventional mining methods (truck and shovel) similar to other Rio Tinto Iron Ore operating 
    mines are utilised. 
    The geotechnical parameters have been applied based on geotechnical studies informed by 
    assessments of diamond drill holes drilled during the 2011, 2012 & 2013 drilling 
    programmes, specifically drilled for geotechnical purposes on the surrounding host rock. 
    Structural geology was assessed based on angled reverse circulation drill holes. 
    During the above process, Inferred Mineral Resources were excluded from mine schedules 
    and economic valuations utilised to validate the economic viability of the Ore Reserves. 
Metallurgical    There are two existing dry crush and screen processing facilities and one existing wet 
factors or    desliming processing facility to which Brockman Syncline 2 – East Detrital ore could be fed. 
assumptions    Product prediction regressions for both dry and wet processing routes are assigned to the 
    designated domains, based on the most appropriate available metallurgical data generated 
    from PQ-3 cores, WDC, winzes and production data. 
    The dry plants crush and screen the ore into dry lump and fines products. 
    The wet desliming plant scrubs, screens and deslimes the ore to produce washed lump and 
    fines products. The plant was commissioned in early 2015. 
    Product moisture assumptions are based on a combination of data from operating sites with 
    similar ore type and results from bench to pilot scale product dewatering test work. 
    Conversion of railed products to shipped products is based on the results of test work that 
    estimates the conversion during rail and port handling process.
    During drill campaigns in 1999, 2005 and 2010 metallurgical drill core was obtained, mostly 
    from the western half of Brockman Syncline 2 – East Detrital and Brockman Syncline 2. These 
    drill cores are believed to have intersected all major geology member/strands with relevant 
    grades. Additional metallurgical PQ-3 core was obtained from eastern half of Brockman 
    Syncline 2 – East Detrital in 2014 and 2015 but the data is not yet available for inclusion in 
    the regressions. The map below show the location of these drill holes, excluding 2014/2015 
    PQ-3 core holes. 
   
Environmental    On behalf of Hamersley Iron Pty Limited (the Proponent) Rio Tinto Iron Ore referred the 
    Nammuldi - Silvergrass Expansion Project to the Environmental Protection Authority on 25 
    June 2010. The proposal was given a level of assessment of a Public Environmental Review 
    under Part IV of the Environmental Protection Act 1986 (EP Act). The proposal included the 
    development of above and below water deposits at each of Nammuldi, Silvergrass and 
    Brockman Syncline 2 – East Detrital. The Minister for Environment authorised the Nammuldi 
    - Silvergrass Expansion on 13 January 2013 via Ministerial Statement 925. 
    Minor above water table extension to pits within the Brockman Syncline 2 – East Detrital 
    deposits was authorised under s45C of the EP Act ion 17 June 2015 (MS 925 as amended). 
    Assessment of the potential for impacts on Matters of National Environmental Significance 
    did not trigger a requirement to refer the proposed development of the Nammuldi, 
    Silvergrass and Brockman Syncline 2 – East Detrital deposits for assessment under the 
    Environment Protection and Biodiversity Conservation Act 1999.
    Rio Tinto Iron Ore has an extensive environmental and heritage approval process. A review of 
    these requirements was undertaken during a PFS and FS study in 2012/2013. The Brockman 
    Syncline 2 – East Detrital project is located in the Hamersley Range, which has a deep and 

9


 

    rich history of Aboriginal occupation. A total of 34 heritage sites were identified within the 
    project area. The locations of these sites were considered during mine planning and 
    engineering activities. Twenty of these sites have been or are proposed to be impacted. 
    A geochemical risk assessment has been completed for the project. The assessment 
    encompasses all material types present at the site, and tests have been conducted in 
    accordance with industry standards. The majority of mining operations at the project pose a 
    low acid mine drainage risk based on current pit designs and the assessment of samples from 
    within the pit locations; however some material that will pose an acid mine drainage risk is 
    likely to be encountered in one of the pits and will be managed according to existing 
    procedures. 
Infrastructure    Brockman Syncline 2 - East Detrital utilises existing facilities located at the Brockman 
    Syncline 2 and Nammuldi mines. 
Costs    Operating costs were benchmarked against similar operating Rio Tinto Iron Ore mine sites. 
    Exchange rates were forecast by analysing and forecasting macro-economic trends in the 
    Australian and World economy. 
    Transportation costs were based on existing operating experience at Rio Tinto Iron Ore mine 
    sites in the Pilbara, Western Australia. 
    Allowances have been made for royalties to the Western Australian government and other 
    private stakeholders. 
Revenue factors    Rio Tinto applies a common process to the generation of commodity price estimates across 
    the group. This involves generation of long-term price curves based on current sales 
    contracts, industry capacity analysis, global commodity consumption and economic growth 
    trends. In this process, a price curve rather than a single price point is used to develop 
    estimates of mine returns over the life of the project. The detail of this process and of the 
    price point curves is commercially sensitive and is not disclosed.
Market    The supply and demand situation for iron ore is affected by a wide range of factors, and as 
assessment    iron and steel consumption changes with economic development and circumstances. Rio 
    Tinto Iron Ore delivers products aligned with its Mineral Resources and Ore Reserves; these 
    products have changed over time and successfully competed with iron ore products supplied 
    by other companies. 
Economic    Economic inputs such as foreign exchange rates, carbon pricing, and inflation rates are also 
    generated internally at Rio Tinto. The detail of this process is commercially sensitive and is 
    not disclosed. 
    Sensitivity testing of the Brockman Syncline 2 - East Detrital Ore Reserves using both Rio 
    Tinto long-term prices and a range of published benchmark prices demonstrates a positive 
    net present value for the project sufficient to meet Rio Tinto Limited investment criteria. 
Social    The Brockman Syncline 2 - East Detrital deposits are located within Mining Lease (ML) 4SA 
    sections 112, 113, 239 and 242 which have been granted pursuant to the Iron Ore 
    (Hamersley Range) Agreement Act 1963. 
    The Brockman 2 East Detrital mine and proposed associated infrastructure falls wholly within 
    the area of the Eastern Guruma groups’ native title determination. Rio Tinto has a registered 
    Indigenous Land Use Agreement with the Eastern Guruma People, which informs the manner 
    in which native title and heritage are managed in the project area. Representatives of the 
    Eastern Guruma People were involved in the multiple archaeological and ethnographic 
    surveys undertaken throughout this area. 
    Rio Tinto Iron Ore has undertaken environmental surveys across the project area to support 
    the development of the Nammuldi - Silvergrass Expansion (including Brockman Syncline 2 – 
    East Detrital). Surveys comprised flora and vegetation and terrestrial, aquatic and 
    subterranean fauna. 
Other    Semi-quantitative risk assessments have been undertaken throughout the Brockman 
    Syncline 2 - East Detrital study phases, no material naturally occurring risks have been 
    identified through the above mentioned risk management processes. 
Classification    The Ore Reserves for the Brockman 2 Hub consist of 50% Proven Reserves and 50% 
    Probable Reserves. 
    The Competent Person is satisfied that the Ore Reserve classification reflects the outcome of 
    technical and economic studies. 
Audits or    No external audits have been performed. 
reviews    Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 

10


 

   

have been completed. These reviews concluded that the fundamental data collection 

   

techniques are appropriate. 

Discussion of 

Rio Tinto Iron Ore operates multiple mines in the Pilbara region of Western Australia. The Ore 
relative   

Reserve estimation techniques utilised for the Brockman Syncline 2 - East Detrital deposit 

accuracy/   

are consistent with those applied at the existing operations. Reconciliation of actual 

confidence   

production with the Ore Reserve estimate for individual deposits is generally within 10 

   

percent for tonnes on an annual basis. This result is indicative of a robust Ore Reserve 

   

estimation process. 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

11


 

2015 Annual Report Ore Reserve Table, showing line items relating to Brockman 2 upgrade

    Proved Ore reserves  Probable Ore reserves  Total Ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                       
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  Interest  Recoverable 
  (a)                  %  metal 
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Hamersley Iron (Australia)                       
- Brockman 2 (Brockman ore) (c)  O/P  47  62.5  46  62.1  93  62  62.3  62.8  100.0  93 

 

(a) Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(c)
Hamersley Iron Brockman 2 (Brockman ore) Reserves tonnes increased due to the inclusion of additional pits, updated geological models and cut-off grade changes. A JORC table 1 in support of this change will be released to the market contemporaneously with the release of this Annual report and can be viewed at riotinto.com/factsheets/JORC.

 

12


 

Appendix 3

West Angelas Deposit F Table 1

The following table provides a summary of important assessment and reporting criteria used at the West Angelas Deposit F for the reporting of exploration results, Mineral Resources and Ore Reserves in accordance with the Table 1 checklist in The Australasian Code for the Reporting of Exploration Results, Mineral Resources and Ore Reserves (The JORC Code, 2012 Edition). Criteria in each section apply to all preceding and succeeding sections.

A summary of the Ore Reserve estimate for West Angelas is provided at the end of this document

SECTION 1 SAMPLING TECHNIQUES AND DATA

Criteria  Commentary 
Sampling    Samples for geological logging, assay, geotechnical, metallurgical and density test work are 
techniques    collected via drilling at West Angelas Deposit F. 
    Drilling for collection of samples for assay is conducted on a North-South grid at 50 m × 50 m 
    collar spacing. All intervals are sampled. 
    All reverse circulation drilling utilises a static and rotary cone splitter beneath a cyclone 
    return system for sample collection. The rotary cone splitter used in most recent holes 
    produces two 8% samples (‘A’ and ‘B’) and one 84% reject sample.
    All diamond core drilling uses triple-tube sampling; HQ-3 (61.1 mm core diameter) and PQ-3 
    (83.0 mm core diameter). 
    Geotechnical and density samples are collected via diamond core drilling of HQ-3 core. 
    Metallurgical and density samples are collected from via diamond core drilling of PQ-3 core. 
    Dry bulk density is derived from accepted gamma-density data collected at 10 cm intervals 
    from down-hole geophysical sondes. Density measured from accepted gamma-density is 
    corrected for moisture from diamond drill core twinned with reverse circulation drilling. 
    Mineralisation is determined by a combination of geological logging and assay results. 
Drilling    Drilling is predominantly by reverse circulation with a lesser proportion of percussion, dual 
techniques    rotary and diamond drill core (Refer to Section 2, Drill hole Information, for a detailed 
    breakdown of drilling by method and year). 
    The majority of drilling is oriented vertically. 
    1970’s drilling was open hole percussion (minimum 5.5 inch diameter). 
    Dual rotary drilling was conducted in 1998 - 2001. 
    The majority of 1998-2014 drilling was reverse circulation with a 140 mm outer diameter. 
    Pre 2013 all reverse circulation holes were dry drilled and 2013 - 2014 programmes were wet 
    drilled. 
Drill sample    No direct recovery measurements of reserve circulation samples are performed. Sample 
recovery    weights are recorded from laboratory splits and the recovery at the rig is visually estimated 
    for loss per drilling interval 
    Diamond core recovery is maximised via the use of triple-tube sampling and additive drilling 
    muds. 
    Diamond core recovery is recorded using rock quality designation (RQD) measurements with 
    all cavities and core loss recorded in the Rio Tinto Iron Ore acQuire™ database. 
    Diamond core recovery is maximised via the use triple-tube sampling and additive drilling 
    muds. 
    Sample recovery in some friable mineralisation may be reduced; however it is unlikely to have 
    a material impact on the reported assays for these intervals. 
    Thorough analysis of duplicate sample performance does not indicate any chemical bias as a 
    result of inequalities in samples weights. 
Logging    All the drill holes are geologically logged utilising standard Rio Tinto Iron Ore Material Type 
    Classification Scheme logging codes. 
    Geological logging is performed on 2 m intervals for all reverse circulation drilling. 
    Since 2001, all drill holes are logged using downhole geophysical tools for gamma trace, 
    calliper, gamma density, resistivity, and magnetic susceptibility.
Sub-sampling 

Sub-sampling techniques: 

techniques and 

 

1998 - 2014: 
sample   

o 

Reverse circulation drilling was sampled at 2 m intervals. Sub sampling was carried 

preparation     

out using a static and rotary cone splitter beneath a cyclone return system, 

 


 

      producing approximate splits of: 
       § ’A’ Split – Analytical sample – 8% 
      § ‘B’ Split – Retention sample - 8% 
      § Bulk Reject - 84%. 
  Sample preparation: 
 

 

1998 - 2006: 
    o  ‘A’ split sample dried at 105° C. 
    o  Dried sample crushed using a Jacques Jaw Crusher to approx. -5 mm. The entire 
      sample was pulverised for samples 3.5 kg and under, samples over 3.5 kg were 
      pulverised to 90% passing 150 microns. 
    2013 – 2014: 
    o  ‘A’ split sample dried at 105° C. 
    o  Sample crushed to -3 mm using Boyd Crusher and split using a linear sample divider 
      to capture 1 – 2.5 kg samples. 
    o  Robotic LM5 used to pulverise total sample (1 – 2.5 kg) to 90% passing 150 micron 
      sieve. 
    o  A 100 gram sub sample collected for analysis. 
Quality of assay  Assay methods: 
data and    An X-Ray Fluorescence (XRF) analysis is conducted to determine: 
laboratory tests   

o 

Fe, SiO2 , Al2 O3 , TiO2 , Mn, CaO, P, S, MgO, K2 O, Zn, Pb, Cu, Ba, V, Cr, Cl, As, Ni, Co, Sn, 
      Sr, Zr, Na 
    Loss on Ignition (LOI) is determined using industry standard Thermo-Gravimetric Analyser 
    (TGA) 
   

o 

1998-2014: 
     

§

LOI was measured at three steps of temperatures: 140° - 425° C, 425° - 
        650° C, 650° - 1000° C. 
    1998 - 1999: Samples were submitted to the SGS Laboratory in Perth for sample preparation 
    and analytical testing. 
    2004 - 2014: Samples were submitted to Ultra Trace Laboratories in Perth for sample 
    preparation and analytical testing. 
  Quality assurance measures include: 
    Insertion of coarse reference standard by Rio Tinto geologists at a rate of one in every 30 
    samples in mineralised zones and one in every 60 samples in waste zones with a minimum of 
    one standard per drill hole. Reference material is prepared and certified by Rio Tinto Iron Ore 
    following ISO 3082:2009 (Iron Ores – Sampling and sample preparation procedures) and ISO 
    9516-1:2003 (Iron Ores – Determination of various elements by X-ray fluorescence 
    spectrometry – Part 1: Comprehensive procedure). 
    Coarse reference standards contain a trace of strontium carbonate that is added at the time 
    of preparation for ease of identification. 
    Field duplicates were collected by sacrificing a ‘B’ split retention sample directly from the rig 
    splitter. Duplicate insertion occurred at a frequency of one in 20. Trace zinc is included in the 
    duplicate sample for later identification. 
    At a frequency of one in 20, -3 mm splits and pulps were collected as laboratory splits and 
    repeats respectively. These sub-samples were analysed at the same time as the original 
    sample to identify grouping, segregation and delimitation errors.
    Internal laboratory quality assurance and quality control measures involve the use of internal 
    laboratory standards using certified reference material in the form of pulps, blanks and 
    duplicates were inserted in each batch. 
    Random re-submission of pulps at an external laboratory is performed following analysis. 
    Analysis of the performance of certified standard and field duplicates has indicated an 
    acceptable level of accuracy and precision with no significant bias.
Verification of    Comparison of reverse circulation and twinned diamond drill core assay data distributions 
sampling and    show that the drilling methods have similar grade distributions verifying the suitability of 
assaying    reverse circulation samples in the Mineral Resource estimate. 
    Data was returned electronically from Ultra Trace Laboratories in Perth. All data is 
    transferred to an acQuire™ database. 
    Written procedures outline the processes of geological logging and data importing, quality 
    assurance and quality control validation and assay importing. A robust, restricted-access 
    database is in place to ensure that any requests to modify existing data go through 
    appropriate channels and approvals, and that changes are tracked by date, time, and user. 
Location of data    From 2006 onwards, all drill hole collar locations at the West Angelas Deposit F deposit are 
points    surveyed to Geocentric Datum of Australia 1994 (GDA94) grid by qualified surveyors using 

2


 

   

Differential Global Positioning System (DGPS) survey equipment, accurate to 10 cm in both 

   

horizontal and vertical directions. 

   

Prior to 2006, all drill hole collar locations at the West Angelas Deposit F deposit were 

   

surveyed to the Australian Map Grid 1984 (AMG84) grid by qualified surveyors. The 

   

coordinates were subsequently converted to GDA94 coordinates in the acQuire™ database 

   

using universal standard grid transformation. 

   

Drill hole collar reduced level (RL) data is compared to detailed topographic maps and show 

   

that the collar survey data is accurate. The topographic surface is based on 10 m grid 

   

sampling of the 2015 Light Detecting and Ranging (LiDAR) survey, including spot heights 

   

from DGPS drilling collars and is considered robust. 

Data spacing   

Drill spacing is predominantly 50 m × 50 m (increases towards deposit margins to 200 m × 

and distribution   

100 m). 

   

The drill spacing is deemed appropriate for sufficient deposit knowledge by the Competent 

   

Person for the Mineral Resource classification applied. 

   

The mineralised domains for the West Angelas Deposit F have demonstrated sufficient 

   

continuity in both geology and grade to support the definition of Mineral Resources, and the 

   

classifications applied under the 2012 JORC Code guidelines. 

Orientation of   

Drill lines are oriented North/South, perpendicular to the deposit strike. 

data in relation   

Reverse circulation drilling is predominantly vertical and intersects the folded stratigraphy at 

to geological   

right angles. 

structure   

 

Sample security   

Analytical samples (A splits) are collected by field assistants, placed onto steel sample racks, 

   

and transported to Ultra Trace Laboratories in Perth, Western Australia for analyses. 

   

Retention samples (B splits) are collected and stored in drums.

   

Assay pulps are retained indefinitely at laboratories and external storage facilities at CTI 

   

Logistic in Perth, Western Australia. 

Audits or   

No external audits have been performed. 

reviews   

Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 

   

have been completed. These reviews concluded that the fundamental data collection 

   

techniques are appropriate. 

 
SECTION 2 REPORTING OF EXPLORATION RESULTS
 
Criteria 

Commentary 

Mineral    Mining lease granted to Robe River Ltd. In 1976 (53% Rio Tinto Ltd.), held under Mining Lease 
tenement and    (ML) 248SA, Section 67 to 80. 
land tenure     
status     
Exploration    Cliffs International Inc. carried out exploration in the area between 1972 and 1978. 
done by other    Robe River Mining Co Pty Ltd. performed exploration between 1992 and 1998 prior to the 
parties    acquisition by Rio Tinto Ltd. 
Geology    The deposit contains both detrital and bedded-hosted iron mineralisation. It is hosted in the 
    Marra Mamba Iron Formation. The mineralisation occurs primarily within the Mount Newman 
    Member with minor mineralisation within the West Angela Member, MacLeod Member and 
    Nammuldi Member. 
    The bedded mineralisation is generally overlain by a variable thickness zone of 
    alluvium/colluvium with a weathering overprint. 

3


 

Drill hole     
Information     
                   
      Diamond Holes  Dual Rotary  Reverse Circulation  Percussion 
    Year              (Open hole) 
      # Holes  Metres  # Holes  Metres  # Holes  Metres  # Holes  Metres 
    1976  -  -  -  -  -  -  4  168 
    1977  -  -  -  -  -  -  32  1,957 
    1998  -  -  -  -  33  2,408  -  - 
    1999  -  -  12  816  52  5,006  -  - 
    2000  -  -  -  -  20  1,672  -  - 
    2001  4  270  16  1,073  44  3,944  -  - 
    2004  -  -  -  -  344  23,652  -  - 
    2005  -  -  -  -  277  26,497  -  - 
    2006  -  -  -  -  564  56,506  -  - 
    2013  -  -  -  -  6  1,140  -  - 
    2014  38  3,185  -  -  186  14,032  -  - 
    Total  42  3,455  28  1,889  1,526  134,857  36  2,125 
      All drilling data has been used for geological interpretation.       
      No quality assurance and quality control processes were performed prior to 1998. Following a 
      review of the 1970’s data, these sample assays have not been used in the Mineral Resource 
      estimate. 
      A review of the 2000 – 2001 sample assay results has determined a significant bias in the 
      assay results and this data has not been used in the Mineral Resource estimate. 
Data      No data aggregation. All reverse circulation samples collected at 2 m intervals. 
aggregation      No grade truncations are performed. 
methods       
Relationship   

 

Down-hole interval lengths reported are essentially true width due to vertical drilling and 
between      gently dipping or horizontal strata. 
mineralisation       
widths and       
intercept       
lengths       

 

4

 


 


5


 

Balanced    Not applicable as Rio Tinto Ltd. has not released exploration results for this deposit. 
reporting     
Other    Geological surface mapping has been collected at 1:25,000 scale in 1972, 1:10,000 between 
substantive    1993 – 1996 and most recently at 1:5,000 scale in 2015 
exploration    Approximately 89% of the Mineral Resource lies above the water table. 
data     
Further work    Further infill reverse circulation drilling is planned to achieve a final designed drilling grid at 50 
    m × 50 m spacing. 

 

 

 

 

 

6


 

SECTION 3 ESTIMATION AND REPORTING OF MINERAL RESOURCES

Criteria  Commentary 
Database    All drilling data is securely stored in an acQuire™ geoscientific information management 
integrity    system managed by a dedicated team within Rio Tinto. The system is backed up nightly on 
    servers in Perth, Western Australia. The backup system has been tested in 2015, 
    demonstrating that it is effective. 
    The drilling database used for Mineral Resource estimation has been internally validated by 
    Rio Tinto Iron Ore personnel by the following methods: 
    o  acQuire™ scripts for relational integrity, duplicates, total assay and missing / blank 
      assay values; 
    o  Grade ranges in each domain; 
    o  Domain names and tags; 
    o  Null and below analytical detection limit grade values; 
    o  Missing or overlapping intervals; 
    o  Duplicate data. 
    Drill hole data is also validated visually by domain and compared to the geological model. 
Site visits    The Competent Person visited West Angelas Deposit F regularly between 2011 and 2015. 
    There were no outcomes as a result of these visits. 
Geological    Overall the Competent Person’s confidence in the geological interpretation of the area is 
interpretation    good, based on the quantity and quality of data available, and the continuity and nature of the 
    mineralisation. 
    Geological modelling was performed by Rio Tinto geologists. The method involves 
    interpretation of stratigraphy using surface geological mapping, lithological logging data, 
    down-hole gamma data, and assay data. 
    Cross-sectional interpretation of each stratigraphic unit is performed followed by 
    interpretation of mineralisation boundaries. Three-dimensional wireframes of the sectional 
    interpretations are created to produce the geological model. 
    Mineralisation is continuous. It is affected by stratigraphy, structure and weathering. The drill 
    hole spacing is sufficient to capture density, grade and geology variation for Mineral Resource 
    reporting. 
    The geological model is sub-divided into domains and both the composites and model blocks 
    are coded with these domains. 
Dimensions    West Angelas Deposit F strikes East-West for approximately 6 km and has a width of 800 m. 
    The mineralisation extends from surface to a depth of 200 m. 
Estimation and    The grade estimation process was completed using Maptek Vulcan software. 
modelling    Mineralised domains were estimated by ordinary kriging and non-mineralised domains were 
techniques    estimated by a moving average method. 
    A block size of 25 m (X) × 10 m (Y) × 5 m (Z) was used for parent blocks. Parent blocks are 
    sub-celled to the geological boundaries to preserve volume. 
    All domains were estimated with hard boundaries applied. 
    Statistical analysis was carried out on data from all domains. High yield limits were applied to 
    Mn, SiO2 , and CaO for the mineralised domains. The limits differed for different domains and 
    were selected based on histograms and the spatial distribution of the respective assay 
    values. 
    Grades are extrapolated to a maximum distance of approximately 450 m from data points. 
    The block model was validated using a combination of visual, statistical, and multivariate 
    global change of support techniques. 
Moisture    All Mineral Resource tonnages are estimated and reported on a dry basis. 
Cut-off    The cut-off for high grade ore is greater than or equal to 58% Fe. 
parameters     

7


 

Mining factors    Development of this Mineral Resource assumes mining using standard Rio Tinto Iron Ore 
or assumptions    equipment and methods similar to other Rio Tinto Iron Ore operations. The assumed mining 
    method is conventional truck and shovel, open pit mining at an appropriate bench height. 
    Mining practices will include grade control utilising blast hole data.
Metallurgical    It is assumed that standard crushing and screening processes used by Rio Tinto Iron Ore will 
factors or    be applicable for the processing of West Angelas Deposit F. 
assumptions     
Environmental    Rio Tinto Iron Ore has an extensive environmental and heritage approval process. A detailed 
factors or    review of these requirements has been undertaken in a recent Preliminary Feasibility Study. 
assumptions    No issues were identified that would impact on the Mineral Resource estimate. 
Bulk density    Gamma-density logs are collected from reverse circulation drill holes. 
    Dry core densities are generated via the following process: 
    o  The core volume is measured in the split and the mass of the core is measured and 
      recorded. 
    o  Wet core densities are calculated by the split and by the tray. 
    o  Core recovery is recorded. 
    o  The core is then dried and dry core masses are measured and recorded. 
    o  Dry core densities are then calculated. 
    Density measured from accepted gamma-density logs is corrected for moisture from 
    diamond drill core twinned with reverse circulation drilling. 
    Dry bulk density was estimated using ordinary kriging in mineralised zones and inverse 
    distance weighted to the first power in waste zones. 
Classification    The model has been classified into the categories of Measured, Indicated and Inferred. The 
    determination of the applicable resource category has considered the average data density 
    for the respective domains, the interpreted geological continuity and the estimation 
    statistics. 
    The Competent Person is satisfied that the stated Mineral Resource classification reflects the 
    data spacing, data quality, level of geological continuity and the estimation constraints of the 
    deposits. 
Audits or    All stages of Mineral Resource estimation have undergone a documented internal peer review 
reviews    process, which has documented all phases of the process. 
Discussion of    Rio Tinto Iron Ore operates multiple mines in the Pilbara region of Western Australia. The 
relative    Mineral Resource data collection and estimation techniques used for West Angelas Deposit F 
accuracy/    are consistent with those applied at other deposits which are being mined. Reconciliation of 
confidence    actual production with the Mineral Resource estimates for individual deposits is generally 
    accurate to within ten percent for tonnes on an annual basis. This result is indicative of a 
    robust process. 
    The accuracy and confidence of the Mineral Resource estimate is consistent with the current 
    level of study (Preliminary Feasibility). 
 
SECTION 4 ESTIMATION AND REPORTING OF ORE RESERVES
Criteria  Commentary 
Mineral    Initial generation of the modifying factors for this Ore Reserve estimate were based on a 
Resource    Mineral Resource estimate completed in July 2013. Subsequent to the completion of the Pre- 
estimate for    Feasibility Study an updated Mineral Resource estimate was completed in April 2015 
conversion to    (incorporating more recent drilling information). The most recent Mineral Resource estimate 
Ore Reserves    together with the Pre-Feasibility Study pit designs were used for reporting Ore Reserves. 
    The declared Ore Reserves are for the West Angelas Deposit F. 
    Mineral Resources are reported additional to Ore Reserves. 
Site visits    The Competent Person has visited West Angelas Deposit F in 2014. 
Study status    A Pre-Feasibility Study was completed in 2015. A Feasibility Study is in progress. 
Cut-off    The cut-off grade for high-grade Marra Mamba ore is greater than or equal to 58% Fe. 
parameters     
Mining factors    The Mineral Resource model was regularised to a block size of 25 m E × 10 m N × 8 m RL 

8


 

or assumptions    which was determined to be the selective mining unit following an analysis of a range of 
    selective mining units. Dilution and mining recovery were modelled by applying the 
    regularisation process to the sub-block geological model. 
    Metallurgical models were applied to the regularised model in order to model products 
    tonnage, grades and yields. 
    Pit optimisations utilising the Lerchs-Grosmann algorithm with industry standard software 
    were undertaken. This optimisation utilised the regularised Mineral Resource model together 
    with cost, revenue, and geotechnical inputs. The resultant pit shells were used to develop 
    detailed pit designs with due consideration of geotechnical, geometric and access 
    constraints. These pit designs were used as the basis for production scheduling and economic 
    evaluation. 
    Conventional mining methods (truck and shovel) similar to other Rio Tinto Iron Ore mines 
    were selected. The mine has been designed to transport ore to an existing central crushing 
    and processing facility. 
    Geotechnical design recommendations for the Pre-Feasibility Study have been supplied 
    based on geotechnical studies informed by the assessment of 7 fully cored and 
    geotechnically logged diamond drill holes (totalling 694 m) drilled in 2014. The resultant 
    design recommendations produce inter-ramp slope angles varying between 20 and 38 
    degrees depending on the local rock mass, hydrogeology, and structural geological 
    conditions. 
    During the above process, Inferred Mineral Resources were excluded from mine schedules 
    and economic valuations utilised to validate the economic viability of the Ore Reserves. 
    The Pre-Feasibility Study considered the infrastructure requirements associated with the 
    conventional truck and shovel mining operation including dump and stockpile locations, and 
    access routes. 
Metallurgical    The West Angelas mine has been designed with a dry crush and screen processing facility 
factors or    similar to processing facilities at other Rio Tinto Iron Ore mining operations. 
assumptions    The proposed metallurgical process is a well-tested and proven processing methodology, 
    having been utilised at Rio Tinto Iron Ore mining operations for decades. 
    During a drill campaign in 2014 a total of 558 m of metallurgical diamond drill core (PQ-3 
    core) was drilled at West Angelas Deposit F. Data obtained from this core formed the basis 
    for metallurgical test work which informed the study for the design of the processing facility 
    and metallurgical models. The map below shows the location of these drill holes. 
   
    The diamond drill core test results were utilised to develop metallurgical models 
    representing different metallurgical domains which were considered representative of the ore 
    body. The metallurgical models predict product tonnage and grade parameters for lump and 
    fines products. 
Environmental    The Deposit A west and Deposit F Proposal was formally referred to the Environmental 
    Protection Authority (EPA) under section 38 of the Environmental Protection Act 1986 in 
    December 2014 and was assessed at a level of Assessment on Proponent Information (API), 
    Category A. The EPA published its Report and Recommendations (Report 1551) in June 2015 
    and the Minister for the Environment approved the Proposal, subject to the conditions of 
    Ministerial Statement 1015, on 21 August 2015. 
    Pursuant to Section 45B of the Environmental Protection Act 1986 for Revised Proposals, 
    Ministerial Statement 1015 is to be read as an addendum to the existing Ministerial 
    Statement 970 (dated 12 June 2014). Ministerial Statement 1015 includes only one 
    additional condition, Condition 10 requiring the Proponent to contribute $750 (excluding 
    GST) per hectare of ‘good to excellent’ condition native vegetation cleared to a government- 
    established conservation offset fund. 

9


 

    A geochemical risk assessment has been completed for the West Angelas deposits. The 
    assessment encompasses all material types present at the site, and tests have been 
    conducted in accordance with industry standards. West Angelas deposits pose a low acid 
    mine drainage risk. 
Infrastructure    West Angelas Deposit F is approximately 10 km from the existing West Angelas mining 
    operations. 
    Access to West Angelas Deposit F during construction will be from the Great Northern 
    Highway and then into the mine site via the mine access road. 
    Operation of West Angelas Deposit F will utilise the existing processing and non-processing 
    infrastructure that are used to operate the West Angelas mine.
    Some minor infrastructure will be established near West Angelas Deposit F including offices, 
    crib facilities, ablutions, refuelling and communications. 
    Water for dust suppression at West Angelas Deposit F will be sourced from bores located at 
    the deposit and in the adjacent Deposit E. These bores will support construction activities and 
    ongoing water demands. 
    Ore will be railed to Rio Tinto’s ports at Dampier and Cape Lambert. The port and railway 
    networks will have sufficient capacity to accommodate ore supply from West Angelas Deposit 
    F. 
Costs    The capital costs are based on a Preliminary Engineering Study utilising experience from the 
    construction of existing similar Rio Tinto Iron Ore projects in the Pilbara, Western Australia. 
    Operating costs were benchmarked against similar operating Rio Tinto Iron Ore mine sites. 
    Exchange rates were forecast by analysing and forecasting macro-economic trends in the 
    Australian and World economy. 
    Transportation costs were based on existing operating experience at Rio Tinto Iron Ore mine 
    sites in the Pilbara, Western Australia. 
    Allowances have been made for royalties to the Western Australian government and other 
    private stakeholders. 
Revenue factors    Rio Tinto applies a common process to the generation of commodity price estimates across 
    the group. This involves generation of long-term price curves based on current sales 
    contracts, industry capacity analysis, global commodity consumption and economic growth 
    trends. In this process, a price curve rather than a single price point is used to develop 
    estimates of mine returns over the life of the project. The detail of this process and of the 
    price point curves is commercially sensitive and is not disclosed.
Market    The supply and demand situation for iron ore is affected by a wide range of factors, and as 
assessment    iron and steel consumption changes with economic development and circumstances. Rio 
    Tinto Iron Ore delivers products aligned with its Mineral Resources and Ore Reserves; these 
    products have changed over time and successfully competed with iron ore products supplied 
    by other companies. 
Economic    Economic inputs such as foreign exchange rates, carbon pricing, and inflation rates are also 
    generated internally at Rio Tinto. The detail of this process is commercially sensitive and is 
    not disclosed. 
    Sensitivity testing of the West Angelas Deposit F Ore Reserves using both Rio Tinto long- 
    term prices and a range of published benchmark prices demonstrates a positive net present 
    value for the project sufficient to meet Rio Tinto Limited investment criteria. 
Social    The West Angelas Deposit F deposits are located within existing tenure Mineral Lease (ML) 
    248SA, which was granted under the Iron Ore (Robe River) Agreement Act 1964. 
    The West Angelas Deposit F expansion and proposed associated infrastructure falls within 
    the area of the Yinhawangka and Ngarlawangga groups’ registered native title claim. 
    The West Angelas Deposit F and associated infrastructure are located within the Shire of East 
    Pilbara. Rio Tinto Iron Ore has established an ongoing engagement with the Shire of East 
    Pilbara which includes scheduled meetings and project updates. Engagement with the Shire 
    on West Angelas Deposit F has been established and will be ongoing throughout the project. 
Other    Semi-quantitative risk assessments have been undertaken throughout the West Angelas 
    Deposit F study phases, no material naturally occurring risks have been identified through 
    the above mentioned risk management processes. 
Classification    The Ore Reserves consist of 74% Proved Reserves and 26% Probable Reserves. 
    The Competent Person is satisfied that the stated Ore Reserve classification reflects the 
    outcome of technical and economic studies. 

10


 

Audits or  •:  No external audits have been performed. 
reviews  •:  Internal Rio Tinto Iron Ore peer review processes and internal Rio Tinto technical reviews 
    have been completed. These reviews concluded that the fundamental data collection 
    techniques are appropriate. 
Discussion of  •:  Rio Tinto Iron Ore operates multiple mines in the Pilbara region of Western Australia. The Ore 
relative    Reserve estimation techniques utilised for the West Angelas Deposit F are consistent with 
accuracy/    those applied at the existing operations. Reconciliation of actual production with the Ore 
confidence    Reserve estimate for individual deposits is generally within 10 percent for tonnes on an 
    annual basis. This result is indicative of a robust Ore Reserve estimation process. 
    Accuracy and confidence of modifying factors are generally consistent with the current level 
    of study (Pre-Feasibility Study). It is anticipated that the modifying factors will be further 
    refined during the Feasibility Study which is currently under way.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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2015 Annual Report Ore Reserve Table, showing line items relating to West Angelas upgrade

    Proved Ore reserves  Probable ore reserves  Total ore reserves 2015 compared with 2014     
    at end 2015  at end 2015             
                    Interest  Recoverable 
  Type  Tonnage  Grade  Tonnage  Grade  Tonnage  Grade  %  metal 
  (a)                     
                       
            2015  2014  2015  2014     
                      Marketable 
                      product 
    millions    millions    millions  millions        millions 
IRON ORE (b)    of tonnes  %Fe  of tonnes  %Fe  of tonnes  of tonnes  %Fe  %Fe    of tonnes 
Reserves at Operating Mines                       
Robe River JV (Australia)                       
- West Angelas (Marra Mamba ore) (c)  O/P  153  62.0  55  60.0  209  185  61.4  61.5  53  111 

 

(a) Type of mine: O/P = open pit (b) Reserves of iron ore are shown as recoverable Reserves of marketable product after accounting for all mining and processing losses. Mill recoveries are therefore not shown.
(c) Robe River JV West
Angelas (Marra Mamba ore) Reserves tonnes increased due to the addition of a new pit, updated geological models and pit design modifications. A JORC table 1 in support of this change will be released to the market contemporaneously with the release of this Annual report and can be viewed at riotinto. com/factsheets/JORC.

 

 

 

 

 

 

 

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