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Rio and Chinalco make up and sign up

Miner Rio Tinto and Chinese-run aluminium firm Chinalco have seemingly patched up the differences caused by last year's collapse of their planned tie-up and are set to agree a $12bn joint venture in Guinea.

The news comes just a day after China officially exonerated Rio from any blame for the break down of the deal that would have seen Chinalco inject $19.5bn into Rio. The report instead blamed Chinalco naivety, poor PR and soaring commodities prices.

The miner also made conciliatory statements in its annual report today. "We deeply regretted the loss of a unique opportunity to establish a strategic partnership that would have fundamentally changed our relationship with our largest customer base," Rio chairman Jan du Plessis wrote in his message to shareholders.

The new joint venture is said to an £8bn development of the Simandou iron ore field in Guinea, an area where China has strong influence. The huge field is said to produce especially high quality ore.

Rio Tinto and Chinalco are also understood to be discussing other joint projects utilise Rio's mining experience in areas where with China has strong political ties such as Guinea.

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