REFILE-Rio to sell stake in Chinese aluminium smelter

(Refiles to fix typo in headline)

SYDNEY Dec 31 (Reuters) - Rio Tinto (RIO.L)(RIO.AX) has agreed to to sell its half in a Chinese aluminium smelting joint venture to its partner Qingtongxia Aluminium, a Rio spokesman said on Wednesday.

Rio, which is trying to sell up to $30 billion in assets to pay off debt, acquired the stake in the joint venture, capable of supplying up to 150,000 tonnes of aluminium smelting capacity a year, when it bought Canada-based aluminium group Alcan last year.

Both Rio spokesman, Jim Singer, and a senior Qingtongxia executive declined to say how much Rio agreed to sell the stake for because the sale was yet to be finalized. Alcan paid about $150 million in 2004 for the half-interest.

"Completion of the transaction is expected in the first quarter of 2009, pending clearance of certain Chinese government approvals," Singer said.

Following a dramatic drop in world commodities prices and a sharp fall in ts share price, Rio ealier this month said it would cut 14,000 jobs and broaden an asset sell-off plan to raise more cash.

Most of Rio's det was incurred from he Alcan purchase.

Rio had hoped to sell $10 billion worth of assets this year out of a planned $15 billion, but had to scrap that target due to the global economic downturn and credit crisis.

It has been trying to sell the downstream packaging and engineering units of its aluminium unit Alcan, its North American coal unit, its Minerals unit, the Northparkes copper mine in Australia and the U.S. Sweetwater uranium operation.

So far it has managed to sell only $3 billion worth of assets. (Reporting by James Regan)