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A technology agreement between Rio Tinto and Codelco – two of the world’s biggest copper mining companies – raises the prospect that large resource companies might pool tech R&D, jointly funding and jointly benefiting from new ways of uncovering more geologically difficult deposits.
Rio and Codelco’s “Rio de Cobre” alliance, announced last week, allows both companies absolute rights to ‘peer over the fence’ at each other’s copper-extracting technologies, said John McGagh, head of innovation at Rio, when talking to the FT yesterday. Rio has a greater expertise in surface mining technology. Codelco, experienced in Chile’s mature mines, has unrivalled expertise in underground copper mining. It is expertise Rio can use if it is to go underground at new projects like Oyu Tolgoi in Mongolia.
The idea would have been unheard-of not long ago, with proprietary mining technology a target more for industrial espionage than cooperation. After all, these are two of the world’s biggest companies and both have large R&D and tech budgets. The idea made sense, said Mr McGagh, because of the increasing complexity of prospective mineral deposits and the clear advantage of extracting metal as soon as possible from these complex deposits. Read more