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Mining’s investment pool is shrinking, Rio says

Feb 04 2020 11:13
Felix Njini, Thomas Biesheuvel and Michael J. Kavanagh

The investment capital available to mining companies is shrinking as the economic boom in China slows and investors see the industry as increasingly risky, says Rio Tinto Group Energy and Minerals CEO Bold Baatar.

“It’s becoming more difficult to invest in mining - our shareholders are rotating largely out of mining for a variety of reasons,” he said. “Money moves around the world where it is less risky.”

Mining companies need to look for new ways of structuring projects including where large producers like Rio Tinto team up with juniors, he said.

Baatar spoke on the sidelines of the African Mining Indaba in Cape Town, the continent’s biggest gathering of one of its most vital industries. 

Anglo on Eskom Boss

The new chief executive officer of struggling power utility Eskom, meanwhile, has at least one fan in the mining industry: Anglo American CEO Mark Cutifani.

Andre de Ruyter’s admission that the country would have to bear with load-shedding for at least 18 months is exactly what South African businesses need, Cutifani said.

“I am far more optimistic today than I was 12 months ago even though the situation might be worse,” he said. “We still have risks, issues that we are going to deal with, but the fact that we have got some brutally honest conversations, now that’s good.”

eskom  |  andre de ruyter  |  mining indaba 2020
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