Rio Tinto's Sam Walsh faces his first difficult decision as chief executive - whether to shut the Gove alumina refinery in Australia - as under-performing units come under tougher scrutiny following $US14B in writedowns this month.
The Northern Territory refinery has been set a Jan 31 deadline by Rio Tinto to come with a plan to lower operating costs by switching from heavy oils to gas for fuel or be mothballed.
Analysts expect the stance taken by Rio Tinto and Walsh at Gove to serve as a template for dealing with other struggling businesses in the firm's portfolio, which include coal in Mozambique and other parts of the aluminium business.
Gove is the worst performer within the Pacific Aluminium division, set up by Rio Tinto in 2011 to prepare 13 smelters and alumina operations in Australia, the United States and Europe for closure, sale or spinoff into a separate entity. Reuters
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