Mining giant Rio Tinto is slashing capital expenditure to shore up its balance sheet as volatility in commodity markets continues.
Rio Tinto says that the total amount it is investing in projects is predicted to fall to $US5 billion ($A6.9 billion) in 2015, compared to a previous forecast of about $US5.5 billion ($A7.57 billion).
The company has also cut its capital expenditure forecasts for 2016 by around $US1 billion ($A1.38 billion) to $US5 billion ($A6.88 billion), down from around $US6 billion ($A8.26 billion).
Iron ore, Rio's main commodity, is trading at a 10-year low of $US39 a tonne.
Chief executive Sam Walsh said the company was being careful during an uncertain period on commodity markets.
"Our prudent capital allocation and disciplined approach to the balance sheet have reinforced our resilience during this period of ongoing volatility," Mr Walsh said in a statement.
"With all of our investment decisions framed by the need to deliver value for shareholders, we have remained focused on investing in only the best quality projects."
Rio recently gave the nod to its massive $US1.9 billion ($A2.63 billion) South of Embley bauxite expansion project, called Amrun, in northern Queensland.
Most of the spending at Amrun is scheduled for 2017 and 2018, ahead of expected production in the first half of 2019, Rio said.
The company added that it was making progress on reducing costs and improving productivity at its Aluminium business.
By the end of 2015, the Aluminium product group will have delivered around $US300 million of cash cost improvements, $US45 million in capital expenditure cuts and around $US400 million in cuts to working capital compared to 2014.
"Further improvements will also be made in productivity in 2016," the company said.
Meanwhile, the company's Kitimat aluminium smelter in Canada is now ramping up and is scheduled to reach full production next year.
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