March 29, 2019 / 6:01 AM / a month ago

Rio Tinto declares force majeure on some iron ore contracts after cyclone

The Rio Tinto mining company's logo is photographed at their annual general meeting in Sydney, Australia, May 4, 2017. REUTERS/Jason Reed

MELBOURNE (Reuters) - Rio Tinto said on Friday it issued force majeure notices to some iron ore customers due to damage from tropical cyclone Veronica, which hit Western Australia earlier this week.

A force majeure is invoked when a company tells a counterparty that it cannot perform an obligation under a contract due to circumstances outside of its control.

The company did not say which specific products were affected by the force majeure but the notice said Rio was “currently assessing the impact of the damage sustained at the Cape Lambert A port facility and is working with its customers to minimize any disruption in supplies.”

Rail and shipping operations at the Cape Lambert B terminal and the port of Dampier have resumed and are ramping up, it said.

Cape Lambert A is an iron ore terminal capable of loading more than 85 million tonnes a year. The port is located on the northwest coast of Western Australia.

The Cape Lambert A port mainly loads iron ore products from the Hamersley Iron Yandicoogina (HIY) and Robe River mines.

(Graphic: Rio Tinto declares force majeure on some iron ore contracts after cyclone damaged a loading port - tmsnrt.rs/2HKuFQb)

In 2018, Rio Tinto shipped 57.4 million tonnes of HIY products and 32 million tonnes of Robe River products.

Rio Tinto said it would provide an update in its first quarter operations review on April 16.

Reporting by Sonali Paul; editing by Richard Pullin and Christian Schmollinger

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