Tuesday, September 18, 2007

Rio mine to go ahead

Rio Tinto (ASX:RIO) has gained environmental support for an iron ore mine in the Pilbara in Western Australia. In March 2007, the WA Environmental Protection Authority rejected the resources company's plans for a $12 billion mine because of the risk to troglofauna. However, the WA Government directed it to reassess its decision. On 17 September, it gave clearance for the project. Rio Tinto will enlarge the mining exclusion zone so that more troglofauna habitat is protected. The decision has disappointed the WA Conservation Council.

It shows what a bit of money can do. The WA government will get a lot more revenue from this going ahead and therefore asked for it to be re reviewed. It must be said this is both a ethical and environmental issue and there may be a slight backlash to the go ahead.

But when you look at RIO you can't be disappointed with their return to shareholders. RIO is a stable resource company and while at a PE of 14 is a bit expensive, it is always worth watching this share

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