Outgoing Rio Tinto CEO Leigh Clifford said that the strong balance sheet allowed the company to invest heavily in growth. He summarized Rio Tinto’s current projects and exploration goals: “Our iron ore expansions in Western Australia remain our biggest current capital investment and are progressing well.

“We are heading for a production capacity in Western Australia of 220 million mt a year by early 2009. This is nearly double our capacity in 2003 and four times our production seven years ago,” said Clifford.

“Due to continued strength in the world’s steel markets, particularly in China, we are now planning for a significant lift beyond 220 million mt. We have the resources to enable this and have teams evaluating the infrastructure requirements to achieve it.

“Meanwhile construction is well under way on the Hope Downs joint venture project. It will start production next year at a rate of 22 million mt, rising to 30 million mt in stage 2,” said Clifford. Our ilmenite project in Madagascar remains on schedule. First production is scheduled for 2008, at a time we believe there will be growing demand for the high quality ilmenite that Madagascar will produce for 40 years.

“Underground development continues at the Argyle mine in Western Australia. We are beginning to see considerable cost pressures concerning materials and especially underground mining skills, as a consequence of the superheated regional economy.

“In Canada, construction of a second dike at the Diavik diamond mine is on schedule. Feasibility studies for underground mining are continuing,” said Clifford.

“At the Simandou iron ore project in Guinea, West Africa, we have recently committed to an expanded prefeasibility study to improve resource definition and evaluate transport options needed to bring this substantial resource into production. This project has the potential to become an important feature of global iron ore supply in the longer term.

“We expect to make a decision on the Potasio Rio Colorado potash project in Argentina later this year.

“Looking to the future, we have acquired interests in three promising copper projects—La Granja in Peru, Oyu Tolgoi in Mongolia, and the Pebble project in Alaska. La Granja has started a pre-feasibility study. First production is at least seven years away. We are very pleased with the recent progress in negotiations in Mongolia and the announcement that agreement in principle has been reached on an Investment Agreement for the development of the Oyu Tolgoi project. The agreement remains subject to approvals by the Mongolian Cabinet and Parliament, Ivanhoe and Rio Tinto, and the finalization of formal documentation.

Clifford was succeeded as CEO on May 1, 2007, by Tom Albanese. Albanese is the first U.S. citizen to head Rio Tinto.