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Rio Tinto will open Michigan Mine

June 16, 2010

“Anglo-Australian miner Rio Tinto PLC Tuesday said it will invest $469 million to build the Kennecott Eagle nickel and copper mine in Michigan after receiving the final environmental approvals for the project.

Rio Tinto plans to produce an average of 17,300 metric tons of nickel and 13,200 tons of copper metal annually over six years from the new mine. Construction of the mine and mill will begin this year and first production is expected in late 2013.

“The long-term demand outlook remains strong for both nickel and copper and bringing Eagle on stream will give us greater benefit from that growth,” said Andrew Harding, chief executive of Rio Tinto’s copper division. “

Source: Wall Street Journal, June 16 2010


  • The investment in Michigan is one of the first large mining investments in the area in decades. Michigan’s environmental regulations are among the strictest in the US.
  • The $0.5 bln will be spend on development of an underground mine, rehabilitation of an existing mill and infrastructure.


  • Copper and nickel prices have recovered after the crisis, although nickel price recently dropped some 30%. Rio Tinto is clearly convinced the prices will stay above crisis level for an extended period of time, as the new mine will certainly not be a low cost producer.
  • Building the only large scale nickel mining operation in the US, Rio Tinto will certainly benefit from low transportation costs to market on the US East Coast. However, in the longer term competition from African seaborne nickel trade might put this position under pressure.

©2010 – thebusinessofmining.com