XML 98 R91.htm IDEA: XBRL DOCUMENT
v3.8.0.1

Principal joint operations/joint ventures (Tables) | 12 Months Ended
--- | ---
Dec. 31, 2017
Disclosure Of Joint Ventures [Abstract] |
Summary of principle joint operations |
Company and country of incorporation/operation | Principal activities | Group interest (%)
Australia |  |
Tomago Aluminium Joint Venture | Aluminium smelting | 51.6
Kestrel (a) | Coal mining | 80
Gladstone Power Station | Power generation | 42.1
Hope Downs Joint Venture | Iron ore mining | 50
Queensland Alumina Limited (b) (c) | Alumina production | 80
Pilbara Iron arrangement | Infrastructure, corporate and mining services | (d)
New Zealand |  |
New Zealand Aluminium Smelters Limited (b) (c) | Aluminium smelting | 79.36
Canada |  |
Aluminerie Alouette Inc. | Aluminium production | 40
Indonesia |  |
Grasberg expansion (e) | Copper and gold mining | 40
United States of America |  |
Pechiney Reynolds Quebec Inc (c) (f) | Aluminium smelting | 50.2
This list includes only those joint operations that have a more significant impact on the profit or operating assets of the Group. Refer to note 46 for a list of related undertakings. The Group’s joint operations are held by intermediate holding companies and not directly by Rio Tinto plc or Rio Tinto Limited.
(a) | Although the Group has an 80 per cent interest in the Kestrel Joint Venture, decisions about activities that significantly affect the returns that are generated require agreement of both parties to the Joint Venture Agreement, giving rise to joint control.
(b) | Although the Group has a 79.4 per cent interest in New Zealand Aluminium Smelters Limited and an 80 per cent interest in Queensland Alumina Limited, decisions about activities that significantly affect the returns that are generated require agreement of both parties to the arrangements, giving rise to joint control.
(c) | Queensland Alumina Limited, New Zealand Aluminium Smelters Limited and Pechiney Reynolds Quebec Inc. are joint arrangements that are primarily designed for the provision of output to the parties sharing joint control; this indicates that the parties have rights to substantially all the economic benefits of the assets. The liabilities of the arrangements are in substance satisfied by cash flows received from the parties; this dependence indicates that the parties in effect have obligations for the liabilities. It is these facts and circumstances that give rise to the classification of these entities as joint operations.
(d) | A number of arrangements are in place between the Australian Iron Ore operations managed by Rio Tinto which allow their respective assets to be operated as a single integrated network across the Pilbara region. The arrangements are managed through two wholly owned subsidiaries: Pilbara Iron (Company) Services Pty Ltd and Pilbara Iron Pty Ltd. In assessing the Pilbara Iron arrangements it has been concluded that they collectively constitute a joint operation on the basis that decisions about relevant activities require unanimous consent, the resulting efficiencies are shared between Rio Tinto and Robe River Iron Associates (Robe River), and the parties fund all of the cash flow requirements of Pilbara Iron (Company) Services Pty Ltd and Pilbara Iron Pty Ltd.
(e) | Under the terms of a contractual agreement, Rio Tinto is entitled to 40 per cent of production above specified levels until the end of 2021 and 40 per cent of all production thereafter under the Participation Agreement. This date is subject to extension under certain conditions.
(f) | Pechiney Reynolds Quebec Inc. has a 50.1 per cent interest in the Aluminerie de Bécancour, Inc. aluminium smelter, which is located in Canada.
Summary of principal joint ventures |
At 31 December 2017
Company and country of incorporation/operation | Principal activities | Number of shares held | Class of shares held | Proportion of class held (%) | Group interest (%)
Chile |  |  |  |  |
Minera Escondida Limitada (a) | Copper mining and refining | - | - | 30 | 30
Oman |  |  |  |  |
Sohar Aluminium Co. L.L.C. (b) | Aluminium smelting/power generation | 37,500 | Ordinary | 20 | 20
This list includes only those joint ventures that have a more significant impact on the profit or operating assets of the Group. Refer to note 46 for a list of related undertakings. The Group’s principal joint ventures are held by intermediate holding companies and not directly by Rio Tinto plc or Rio Tinto Limited.
(a) | Although the Group has a 30 per cent interest in Minera Escondida Limitada, participant and management agreements provide for an Owners’ Council whereby significant commercial and operational decisions about the relevant activities that significantly affect the returns that are generated in effect require the joint approval of both Rio Tinto and BHP Billiton (holders of a 57.5 per cent interest). It is therefore determined that Rio Tinto has joint control.
The year-end of Minera Escondida Limitada is 30 June. The amounts included in the consolidated financial statements of Rio Tinto are, however, based on accounts of Minera Escondida Limitada that are coterminous with those of the Group.
(b) | Although the Group holds a 20 per cent interest in Sohar Aluminium Co. L.L.C., decisions about relevant activities that significantly affect the returns that are generated require agreement of all parties to the arrangement. It is therefore determined that Rio Tinto has joint control.
Summary information for joint ventures that are material to the Group This summarised financial information is shown on a 100 per cent basis. It represents the amounts shown in the joint ventures’ financial statements prepared in accordance with IFRS under Group accounting policies, including fair value adjustments and amounts due to and from Rio Tinto.
| Minera |  | Minera |  | Sohar |  | Sohar |
| Escondida |  | Escondida |  | Aluminium |  | Aluminium |
| Limitada (a) |  | Limitada (a) |  | Company LLC (b) |  | Company LLC (b) |
| 2017 |  | 2016 |  | 2017 |  | 2016 |
| US$m |  | US$m |  | US$m |  | US$m |
Revenue |  | 6,037 |  |  | 4,883 |  |  | 460 |  |  | 610 |
Depreciation and amortisation |  | (1,690 | ) |  | (1,213 | ) |  | (145 | ) |  | (130 | )
Other operating costs |  | (2,617 | ) |  | (2,199 | ) |  | (205 | ) |  | (425 | )
Operating profit |  | 1,730 |  |  | 1,471 |  |  | 110 |  |  | 55 |
Finance expense |  | (120 | ) |  | (47 | ) |  | (35 | ) |  | (25 | )
Income tax |  | (627 | ) |  | (517 | ) |  | - |  |  | - |
Profit after tax |  | 983 |  |  | 907 |  |  | 75 |  |  | 30 |
Total comprehensive income |  | 983 |  |  | 907 |  |  | 75 |  |  | 30 |
Non-current assets |  | 13,814 |  |  | 14,947 |  |  | 3,230 |  |  | 3,275 |
Current assets |  | 2,760 |  |  | 2,257 |  |  | 305 |  |  | 255 |
Current liabilities |  | (1,727 | ) |  | (1,403 | ) |  | (205 | ) |  | (45 | )
Non-current liabilities |  | (4,617 | ) |  | (4,112 | ) |  | (1,270 | ) |  | (1,505 | )
Net assets |  | 10,230 |  |  | 11,689 |  |  | 2,060 |  |  | 1,980 |
Assets and liabilities above include: |  |  |  |  |  |  |  |  |  |  |  |
Cash and cash equivalents |  | 460 |  |  | 443 |  |  | 95 |  |  | 20 |
Current financial liabilities (c) |  | (330 | ) |  | (467 | ) |  | (130 | ) |  | (100 | )
Non-current financial liabilities (c) |  | (2,840 | ) |  | (2,643 | ) |  | (1,120 | ) |  | (1,230 | )
Dividends received from joint venture (Rio Tinto share) (c) |  | 780 |  |  | 210 |  |  | - |  |  | - |
Reconciliation of the above amounts to the investment recognised in the Consolidated Statement of Financial Position |
Group interest |  | 30 | % |  | 30 | % |  | 20 | % |  | 20 | %
Net assets |  | 10,230 |  |  | 11,689 |  |  | 2,060 |  |  | 1,980 |
Group's ownership interest |  | 3,069 |  |  | 3,507 |  |  | 412 |  |  | 396 |
Other adjustments |  | 4 |  |  | (3 | ) |  | (3 | ) |  | (2 | )
Carrying value of Group's interest |  | 3,073 |  |  | 3,504 |  |  | 409 |  |  | 394 |
(a) | In addition to its “Investment in equity accounted units”, the Group recognises deferred tax liabilities of US$500 million (2016: US$579 million) relating to tax on unremitted earnings of equity accounted units.
(b) | Under covenants stipulated in the agreement to Sohar Aluminium’s secured loan facilities, Sohar Aluminium is currently restricted from making any shareholder distributions until 2021 unless a specified amount of the loan facilities is funded.
(c) | The 2016 comparative has been adjusted to more appropriately classify certain balances.

X
- Definition The disclosure of joint operations. [Refer: Joint operations [member]] + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name IFRS -Number 12 -IssueDate 2016-01-13 -Paragraph B4 -Subparagraph c -URI http://eifrs.ifrs.org/eifrs/XBRL?type=IFRS&num=12&date=2016-03-30&anchor=para_B4_c&doctype=Appendix&seq=2 -URIDate 2016-03-31 + Details
Name: | ifrs-full_DisclosureOfJointOperationsExplanatory
Namespace Prefix: | ifrs-full_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration

X
- References No definition available. + Details
Name: | ifrs-full_DisclosureOfJointVenturesAbstract
Namespace Prefix: | ifrs-full_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The disclosure of the reconciliation of the summarised financial information of a joint venture accounted for using the equity method to the carrying amount of the reporting entity's interest in the joint venture. [Refer: Carrying amount [member]; Joint ventures [member]] + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Name IFRS -Number 12 -IssueDate 2016-01-13 -Paragraph B14 -Subparagraph b -URI http://eifrs.ifrs.org/eifrs/XBRL?type=IFRS&num=12&date=2016-03-30&anchor=para_B14_b&doctype=Appendix&seq=2 -URIDate 2016-03-31 + Details
Name: | ifrs-full_DisclosureOfReconciliationOfSummarisedFinancialInformationOfJointVentureAccountedForUsingEquityMethodToCarryingAmountOfInterestInJointVentureExplanatory
Namespace Prefix: | ifrs-full_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration