Rio defers Australian development

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The world's third-largest mining firm, Anglo-Australian firm Rio Tinto, has suspended a $229m (£156m) development at an Australian copper and gold mine.

It comes a day after the firm said it was postponing a $2.15bn expansion of its Corumba iron ore mine in Brazil.

Rio said falling copper prices were behind its decision to stop working on the underground development at the Northparkes mine in New South Wales.

Meanwhile miners Xstrata and Oz Minerals are also cutting production.

Xstrata is restructuring lead-zinc operations at its Mount Isa mining and metals-processing complex in the north-eastern Australian state of Queensland.

It also said its Handlebar Hill open-cut zinc-lead mine, north of Mount Isa, would shut in mid-February.

Oz Minerals is to suspend operations at one of its western Australian mines and cut zinc production in 2009 in favour of copper.

Price falls

Rio announced in December it was cutting 14,000 jobs as part of plans to reduce its debt by $10bn (£6.8bn) by the end of 2009.

"As a result of a significant reduction in the copper price of over 60% since June last year, combined with the global economic downturn, construction of the E48 underground project will be suspended," the project's general manager Craig Stegman said in a statement on Tuesday.

But Northparkes' open-cut mine will continue to operate, said Rio, which holds an 80% stake in Northparkes with the remainder held by joint venture partner Sumitomo Corp.

Last year Rio Tinto fended off a takeover approach from rival BHP Billiton, which finally abandoned its offer in November.