Rio Tinto and the Resolution Copper Mining Joint Venture (a): The Land Exchange

Abstract

From its inception, the Resolution Copper Mining (RCM) joint venture faced a number of significant technical, political, and environmental challenges as it attempted to develop a strategy for mining a copper ore body located under the Tonto National Forest in Superior, Arizona. As president and CEO of RCM, David Salisbury faced a number of key decisions in 2008–10 to keep the project on track. The success of the mine hinged on a politically complicated land exchange—and an act of Congress—in which the federal government would give RCM land containing the copper ore in exchange for parcels of ecological significance. Accomplishing this goal required Salisbury to engage with multiple stakeholders and navigate a complicated congressional landscape.

Excerpt

UVA-E-0374

Aug. 13, 2012

Rio Tinto and the Resolution Copper Mining Joint Venture (A):

The Land Exchange

On the evening of February 16, 2009, David Salisbury, president and CEO of Resolution Copper Mining (RCM), leaned back in his chair and mulled over a pending e-mail notice to 200 employees and contractors involved in the development of RCM's Superior, Arizona, project. The e-mail was about the status and future of the project. The mining project required an act of Congress to progress and, considering the varying priorities on Capitol Hill, it appeared unlikely that legislative action would be taken in the short term. Faced with this information, Salisbury needed to make a decision about the mine's costly near-term development activities: specifically, whether the activities should be suspended, scaled back, or continued unabated.

Salisbury's involvement in the RCM project dated back to March 2008, when the senior leadership team at Rio Tinto Group, one of the world's largest multinational mining companies, had summoned him to take over management of RCM. As a seasoned managing director with almost 16 years at Rio Tinto, Salisbury was well versed in the company's unique approach to the sustainable development of mining operations. His past successes in operations and mine closure and his extensive work with communities across the world meant Salisbury had the right combination of skills needed to advance RCM into the next stage of development.

. . .

Keywords: business ethics, environment, sustainability, copper mining, stakeholder management, leadership, governmental relations, business-government, negotiations, Arizona