Rio Tinto throws the kitchen sink at copper quest in the wake of kiboshed Glencore mega-merger

Rio Tinto is throwing the kitchen sink at securing more copper, with 85 per cent of its $1.1 billion exploration budget now directed towards finding the coveted red metal. Rio chief Simon Trott announced the renewed copper push after the company boosted its final dividend despite a weaker bottom line. Net profit of $US10 billion ($14.1b) for 2025 was a 14 per cent decline year-on-year from $US11.6b. This was largely driven by average iron ore sale prices from its flagship Pilbara mines decreasing 8 per cent. The final declared dividend, however, is up from $US2.25 to $US2.54. Totals dividends for 2025 will be $US4.02, steady on the shareholder payout a year prior. “Our solid financial results demonstrate clear progress as we embed our stronger, sharper and simpler way of working,” Mr Trott said. “We achieved an 8 per cent uplift in copper-equivalent production driven by the ongoing ramp-up of the Oyu Tolgoi underground copper mine and record iron ore production since April from our Pilbara operations. “Our strong cash flow and balance sheet enable us to sustain a 60 per cent payout ratio with a $US6.5b ordinary dividend, making it the 10th consecutive year at the top end of the range.” Mr Trott signalled that Rio’s broader business growth would underpinned by a 3 per cent compound annual growth rate in copper production to 2030. Mining giants across the globe are clamouring to boost their reserves of copper, with the red metal’s demand expected to boom for decades to come given its extensive applications in the data centres and computer chips that make artificial intelligence possible. BHP is the world’s largest producer of copper but rival Rio is playing catch-up outside of the top five. Rio’s recent interest in a $350b-plus merger with Glencore was fuelled by the latter’s large copper project pipeline. Earlier this week, BHP chief executive Mike Henry made a thinly-veiled dig at Rio after saying his company, unlike many of its rivals, was not “M&A dependent” to unlock copper growth. Mr Trott signalled Rio is now looking inwards to get its hands on new sources. “Our exploration teams have really narrowed their scope and put copper front and centre,” he said. “As a result, we’re now directing 85 per cent of our exploration budget towards copper. While Mr Trott did not reveal what the copper portion of the exploration budget was a year ago, he said the new figure was “a significant increase”. The Rio boss also mentioned the Winu copper-gold project in the Pilbara as one of Rio’s key growth avenues. Winu is Rio’s sole copper option in Australia — and one of only a handful in its global portfolio. Rio has dragged its feet in developing Winu into a mine since discovering the prospect in 2017. Winu was said to be too small for a company of Rio’s scale. The Pilbara project has now come into sharp focus after hopes of a Glencore merger were dashed. Rio on Thursday said a pre-feasibility study for an initial processing capacity development of up to 10 million tonnes per annum was completed it the final quarter of 2025. “The project has advanced to a feasibility study, which is currently in progress and scheduled for completion by the end of 2026,” the company stated. Sumitomo Metal Mining agreed to pay $US399 million for a 30 per cent stake in the project in late 2024.