The Rio Tinto Ltd (ASX: RIO) share price is edging lower on Tuesday. This comes despite the company signing a contract with mining solutions business K2Fly Ltd (ASX: K2F).
At the time of writing, the mining giant’s shares are down 0.69% to $96.83 apiece.
Let’s take a closer look at the announcement.
Ground Disturbance solution roll out
In today’s statement, Rio Tinto signed a deal for K2Fly’s ground disturbance solution to be implemented across its Pilbara operations.
The 5-year agreement is expected to generate annual recurring revenue (ARR) of around $620,000 for K2Fly. The total contract value is estimated to be $3.44 million (including non-recurring implementation fees) over the initial 5-year term.
Rio Tinto operates an extensive portfolio of iron ore mining assets across the Pilbara region in Western Australia. This consists of a network of 16 iron ore mines, 4 independent port terminals, a 1,700-kilometre rail network, and related infrastructure.
The ground disturbance solution provides a single source for applying, approving, tracking, reporting and submitting closure of permits, and rehabilitation commitments.
The latest addition further expands the number of K2Fly solutions used by Rio Tinto. Other suites include resource inventory & reconciliation, dams & tailings, community & heritage, and mine geology data management.
K2Fly CEO Nic Pollock commented:
We are delighted to continue to expand our relationship with Rio Tinto into ground disturbance. Effective ground disturbance systems are the glue for operations that want to ensure technical assurance around land management, maintain license to operate and ensure high ESG standards. We are pleased to be working closely with Rio Tinto across a number of key ESG solutions globally.
About the Rio Tinto share price
Over the last 12 months, Rio Tinto shares have moved in circles, remaining relatively flat for the period. However, its shares have fallen around 15% in 2021 due to a slump in iron ore prices.
Rio Tinto commands a market capitalisation of roughly $36.18 billion, making it the fourteenth largest company on the ASX.
The post Rio Tinto (ASX:RIO) share price dips on new contract news appeared first on The Motley Fool Australia.
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Motley Fool contributor Aaron Teboneras has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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