Rio Tinto share price marching higher amid $426 million 'industry-leading' step
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The Rio Tinto Ltd (ASX: RIO) share price is marching higher today.
Shares in the S&P/ASX 200 Index (ASX: XJO) mining stock closed Friday at $119.00. In late morning trade on Monday, shares are swapping hands for $119.92 apiece, up 0.77%.
For some context the ASX 200 is down 0.33% at this same time.
This comes as the miner reports on its latest sustainable production initiatives.
Rio Tinto share price lifts on low-carbon aluminium
The Rio Tinto share price is in the green after the company announced it will install carbon-free aluminium smelting cells at its Arvida smelter in Quebec, Canada.
This will see the ASX 200 miner using the first technology licence issued by the ELYSIS joint venture. Rio Tinto noted this investment would support the ongoing development of the ELYSIS technology and enable the company to build expertise in its installation and operation.
Management said the facility will use the same technology that's already been successfully demonstrated at the ELYSIS Industrial Research and Development Center, also in Quebec.
Rio Tinto will design, engineer, and build a demonstration plant equipped with ten pots operating at 100 kiloamperes (kA). A new joint venture will own the plant.
Rio Tinto will invest US$179 million in the JV, and Quebec's state government will invest US$106 million via Investissement Quebec. That will see the equity partners kick in a total investment of US$285 million (AU$426 million).
The plant will have the capacity to produce up to 2,500 tonnes of commercial-quality aluminium per year without direct greenhouse gas emissions. The first production is targeted for 2027.
Commenting on the green production plan that could offer the Rio Tinto share price some ongoing tailwinds, the miner's Aluminium CEO Jerome Pecresse said:
This investment will further strengthen Rio Tinto's industry-leading position in low-carbon, responsible aluminium in North America with our hydro-powered smelters and our recycling capacity.
Becoming the first to deploy the ELYSIS carbon-free smelting technology is the next step in our strategy to decarbonise and grow our Canadian aluminium operations.
In addition to delivering even lower-carbon primary aluminium for our customers, this investment will allow Rio Tinto to build its expertise on installing and operating this new technology, while the ELYSIS joint venture continues its research and development work to scale it up to its full potential.
Quebec Minister of Economy, Innovation and Energy Pierre Fitzgibbon added: "This is a technological innovation with unprecedented benefits for our aluminium sector, which remains an undisputed world leader."
Potentially offering some additional support for the Rio Tinto share price, the miner said ELYSIS joint venture partner, Alcoa Corp (NYSE: AA), will have the option to purchase a portion of the aluminium produced over the first four years at the demonstration plant through an offtake agreement.
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Motley Fool contributor Bernd Struben has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.