From: Reuters
Published November 25, 2007 09:30 PM

Rio declares force majeure at Australia coal mine

SYDNEY (Reuters) - Rio Tinto <RIO.AX><RIO.L> said on Monday it has declared force majeure on coking coal exports from its big Hail Creek mine in Australia's Queensland state.

The company said the declaration was due to a reduction in first quarter 2008 port allocations by 4.1 million tonnes at the Dalrymple Bay coal port in central Queensland.

"This reduction in port entitlements is significant and follows numerous reductions throughout 2007," Rio Tinto said in a statement.

Rio Tinto Coal Australia's share of the allocation cuts will be 1.2 million tonnes, split between 0.5 million tonnes at Hail Creek and 0.7 million tonnes at the Blair Athol mine, it said.

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"The size of these reductions in port entitlements will prevent RTCA from performing our obligations under the terms of our coal contracts, which is why we have declared force majeure," it said.

The force majeure will apply to first quarter 2008 sales, it said. A Rio spokeswoman could not provide an estimate of the duration of the force majeure.

Coking coal from the Hail Creek mine is mainly exported to North Asian steel mills, especially in Japan.

BHP Billiton Ltd <BHP.AX> <BLT.L>, which is the biggest coking coal exporter from Queensland, said its exports would not be affected because they went through a separate port facility.

(Reporting by Michael Byrnes)

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