Rio Tinto (NYSE:RIO)
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Rio Tinto PLC (RIO) Tuesday opened a center in India with engineering research firm iGate Patni that will seek to adapt technology developed by the mining company for broader use in different locations and for other commodities across its global operations.
The move is part of the Anglo-Australian company's push to adopt automated mining technology to improve the efficiency of its operations, lower production costs and improve safety. A number of mining companies have looked at automated mining systems, but Rio is at the forefront with plans to roll out a fleet of driverless trucks, trains and drill rigs in Australia's remote, iron ore-rich Pilbara region.
Rio Tinto plans to spend $60 million-$80 million in the partnership over five years to provide engineering research and development services at the new center in Pune. The partnership will aim to find practical ways of applying what is developed at Rio's five technology centers in Australia, Canada and the U.K.
"This partnership will enable us to move our innovations from concept stage to reality more efficiently through the work of a dedicated team of specialized engineers," said John McGagh, Rio's head of innovation.
The Indian operation will have about 300 employees, mainly engineers, Rio said.
"We are eager to cross-leverage our experience in engineering and technology deployment across diverse fields such as industrial automation, logistics, imaging and human factors designs," said Satish Joshi, head of engineering services at iGate Patni, the common brand of Patni Computer Systems Ltd. (532517.BY) and majority owner iGate Corp. (IGTE).
Rio last month said it would invest US$518 million in autonomous trains for its rail network in Western Australia, with the first driverless train expected to begin running in 2014 on the 1,500-kilometer network. In November, it signed an agreement to buy at least 150 driverless trucks from Komatsu Ltd. (6301.TO) over the next four years for its Pilbara iron ore mines, adding to the five trucks currently being tested at one of its mines.
India provides a suitable location for Rio Tinto's technology center because of the country's highly skilled labor pool and the fact that the new center will be able to facilitate communication between Rio's other centers in different timezones, a Rio spokesperson said.
Rio Tinto reported $2 billion in sales to India in 2011 and currently has a diamond project and an iron ore project in the country. It also employs 850 people in India through contract work primarily focused on legal and mining development, the Rio spokesperson said.
-By Robb M. Stewart, Dow Jones Newswires; +61 3 9292 2094; email@example.com
(Alex MacDonald in London and Dhany Thoppil in Bangalore contributed to this story.)