Finally, before we begin, please pay attention to our cautionary statement on Slide 2. Make sure to read this carefully before reviewing the rest of the materials. It is now my pleasure to turn it over to Rio Tinto's CEO, Jakob Stausholm. Jakob?

Thank you, Menno. Good morning, and good evening to those of you listening in the Far East and Australia. It's a pleasure to present in person for the first time in London for 2.5 years. Our world has certainly changed in that time. The short-term outlook remains truly unpredictable, from logistics and supply chain issues and ongoing COVID impact to the war in Ukraine and increasing geopolitical tensions. Lately, heightened inflation in the Western world is putting pressure on real incomes and spending power. This is forcing governments and central banks to take actions, which add to the risk of potential recessions. This clearly impacts us. However, it is worth noting that China isn't experiencing such inflationary pressures. Therefore, it has more room to maintain a supportive policy stance and introduce additional easing measures to stimulate growth. The ultimate impact of these measures will be balanced by the effect of the ongoing COVID-19 restrictions. Overall, this could provide the mining industry and Rio Tinto an advantage over other industries considering China's role in global commodity demand and particularly iron ore. For Rio, China accounts for over half of our revenues. We remain convinced that the longer-term trends that we highlighted last October remain intact, underpinned by ongoing urbanization and additional demand created by the energy transition. This reinforces our belief that Rio Tinto is a mining company that is uniquely positioned for the future. While it is a time of continuing economic uncertainty, it is also one of opportunity. We have the portfolio to play a vital role in supplying materials for the energy transition, the ambition to decarbonize our business and the conviction that we are making the right investments in our culture and our partnership to unlock our full potential. I've always said it will take time to build a stronger Rio Tinto. It does. But we are making progress against each of our 4 objectives and are seeing the future Rio Tinto emerging. We strengthened our operational performance at a number of sites. We will now replicate this across the portfolio as we work to restore our DNA of being the best operator. We've done a great deal of work as we initiate our decarbonization journey. We continue to engage externally to rebuild relationships, particularly with Traditional Owners but also other stakeholders. This is all done with an absolute determination to achieve impeccable ESG credentials. We have made notable focus in creating value-adding growth options. From advancing or completing internal projects to acting with discipline in our choices on M&A, we are demonstrating our ability to excel in development. Finally, we are working on our social license. This will be judged by others, but it clearly requires us to work hard to restore trust, to rebuild relationships and to make Rio a place people are proud to work for and partner with. We remain totally focused on maintaining our momentum with a consistent disciplined approach. This applies to our performance, engagement, growth, decarbonization and, most importantly, our culture. Turning to our first half performance. Let's start with safety. We achieved another fatality-free half building on the prior 3 years. Safety requires discipline every day on every site and on every shift. Seeing our people return home safely each day remain our first priority. Beyond safety, we delivered good results in market conditions that were robust albeit below last year's record levels. I'm proud to see the positive momentum from the rollout of the Rio Tinto Safe Production System. We must build on this and replicate the successes across our assets. We are well positioned after a stronger second quarter particularly from our iron ore operations. Our performance also highlighted a number of areas where we need to improve. We achieved EBITDA of $15.6 billion with $4.8 billion of taxes and royalties. We invested $3.1 billion in growth and sustaining CapEx with free cash flow of $7.1 billion. The return on capital employed was 34%. Once again, our iron ore business is the primary contributor, but each of our product groups achieved double-digit returns. As a result, we will return $4.3 billion to our shareholders, our second highest interim dividend ever. This 50% payout is in line with our policy and reflects disciplined capital allocation and the strength of our balance sheet. Looking ahead, while the pricing environment is becoming more challenging, the demand outlook remains positive.

Thank you, Jakob, and good morning, and good evening, everyone. Let's start by taking a look at the numbers. We've announced a solid set of results following robust demand for all our major commodities. And of course, this is set against the context of record prices and results last year. The 10% decline in revenues was driven by prices, primarily iron ore. This was offset in part by aluminum, where we saw strong pricing for the first 5 months of the year until markets changed in June. While the business remained resilient, cyclical cost inflation accelerated during the half. This led to some margin compression with $15.6 billion in underlying EBITDA and $10.5 billion of cash flow from operations. Free cash flow of $7.1 billion was after $3.1 billion of capital expenditure and a modest outflow in working capital, reflecting elevated prices for raw materials in aluminum inventory. Underlying earnings of $8.6 billion gave rise to a return on capital of 34% and led to us declaring an interim dividend of $4.3 billion, a 50% payout. Higher rates of inflation, increased closure liabilities, resulting in a $400 million pretax noncash charge to underlying earnings. We expect a similar impact in the second half under our existing policy if current rates of inflation persist. We were very glad to reach a settlement with the Australian Tax Office on all tax issues stretching back over the last 12 years. The settlement had a limited impact on our half year results, but we will pay just over AUD 600 million in the second half of the year. Importantly, the settlement gives us certainty on our transfer pricing arrangements between Australia and Singapore for the next 5 years. There were no material unusual items in the first half, so net earnings were very similar to underlying earnings. Let's now look at our key markets. Iron ore prices dropped 24% from the record highs we enjoyed in 2021 first half. In a context of continued softness in the Chinese property market and COVID restrictions, steel demand remained relatively robust. Prices were supported by weaker supply with flat production from the majors and disruption to some other sources of supply, in particular, from Russia and Ukraine. There was also disruption in the aluminum market, mainly from high energy prices which impacted supply from late 2021 and resulted in very low physical stocks. This pushed prices up 37% on average, although new capacity in China coupled with lower consumer sentiment elsewhere have reduced prices in the second quarter. The copper price has also been quite volatile. After a record first quarter, uncertainty in the global economy has weighed on prospects. A long position of just over 1 million tonnes in the copper market fully unwound in the second quarter. Let's now take a closer look at the key drivers of EBITDA. As ever, commodity prices were the biggest movement, lowering EBITDA by $3.4 billion in aggregate. Iron ore was $5.7 billion negative, partly offset by higher realized pricing for aluminum to the tune of $1.9 billion. As you would expect, we are not immune to inflation, reflected on the left of this chart, with PPI, rising energy costs largely attributed to diesel and higher market-linked prices for raw materials in aluminum all having an impact. In aggregate, these factors lowered EBITDA by $1.5 billion. If we look to the right of this chart, you can see the other impacts were relatively well contained, demonstrating the resilience of our operations. Sales volumes were reasonably flat overall, even though Kitimat was only operating at 25% of capacity. And we expect it to gradually recover over the second half. Higher iron ore sales from our portside operations in China were an important contributor with inventory reduced by just under 5 million tonnes this half. We did incur additional costs at Kitimat and Boyne as we recovered from disruption. And we also increased our resourcing in our iron ore business to support the ramp-up of Gudai-Darri and investment in the pit and health and system reliability. The impact of other cost increases overall was relatively muted, reflecting disciplined cost control across the business. Looking forward, a stronger U.S. dollar represents a decent tailwind to help offset further cost inflation in the second half. Now on to our productivity drive, which is gathering momentum. We continue to successfully roll out the Rio Tinto Safe Production System and have 15 deployments at 11 sites compared to 5 sites at the start of the year. Each deployment addresses a different bottleneck. For example, at IOC and Kennecott, we focused on the concentrator. And at West Angelas, on the drill fleet. We are seeing sustainable improvements in operating performance as well as in safety and employee engagement. To give you an indication, in the half, there has been a 9% year-on-year improvement in average operating times across processing plants and drills at deployment sites versus the same period of 2021. Our focus is to scale it up to a multiyear program covering all assets across the group. And we are on track to meet our 2022 target of 30 deployments at 15 sites, and we'll build on that in 2023.

Let me now hand over to Peter to take you through the financials in detail. Peter, please?

Thank you, Jakob, and good morning, and good evening, everyone. Let's start by taking a look at the numbers. We've announced a solid set of results following robust demand for all our major commodities. And of course, this is set against the context of record prices and results last year. The 10% decline in revenues was driven by prices, primarily iron ore. This was offset in part by aluminum, where we saw strong pricing for the first 5 months of the year until markets changed in June. While the business remained resilient, cyclical cost inflation accelerated during the half. This led to some margin compression with $15.6 billion in underlying EBITDA and $10.5 billion of cash flow from operations. Free cash flow of $7.1 billion was after $3.1 billion of capital expenditure and a modest outflow in working capital, reflecting elevated prices for raw materials in aluminum inventory. Underlying earnings of $8.6 billion gave rise to a return on capital of 34% and led to us declaring an interim dividend of $4.3 billion, a 50% payout. Higher rates of inflation, increased closure liabilities, resulting in a $400 million pretax noncash charge to underlying earnings. We expect a similar impact in the second half under our existing policy if current rates of inflation persist. We were very glad to reach a settlement with the Australian Tax Office on all tax issues stretching back over the last 12 years. The settlement had a limited impact on our half year results, but we will pay just over AUD 600 million in the second half of the year. Importantly, the settlement gives us certainty on our transfer pricing arrangements between Australia and Singapore for the next 5 years. There were no material unusual items in the first half, so net earnings were very similar to underlying earnings. Let's now look at our key markets. Iron ore prices dropped 24% from the record highs we enjoyed in 2021 first half. In a context of continued softness in the Chinese property market and COVID restrictions, steel demand remained relatively robust. Prices were supported by weaker supply with flat production from the majors and disruption to some other sources of supply, in particular, from Russia and Ukraine. There was also disruption in the aluminum market, mainly from high energy prices which impacted supply from late 2021 and resulted in very low physical stocks. This pushed prices up 37% on average, although new capacity in China coupled with lower consumer sentiment elsewhere have reduced prices in the second quarter. The copper price has also been quite volatile. After a record first quarter, uncertainty in the global economy has weighed on prospects. A long position of just over 1 million tonnes in the copper market fully unwound in the second quarter. Let's now take a closer look at the key drivers of EBITDA. As ever, commodity prices were the biggest movement, lowering EBITDA by $3.4 billion in aggregate. Iron ore was $5.7 billion negative, partly offset by higher realized pricing for aluminum to the tune of $1.9 billion. As you would expect, we are not immune to inflation, reflected on the left of this chart, with PPI, rising energy costs largely attributed to diesel and higher market-linked prices for raw materials in aluminum all having an impact. In aggregate, these factors lowered EBITDA by $1.5 billion. If we look to the right of this chart, you can see the other impacts were relatively well contained, demonstrating the resilience of our operations. Sales volumes were reasonably flat overall, even though Kitimat was only operating at 25% of capacity. And we expect it to gradually recover over the second half. Higher iron ore sales from our portside operations in China were an important contributor with inventory reduced by just under 5 million tonnes this half. We did incur additional costs at Kitimat and Boyne as we recovered from disruption. And we also increased our resourcing in our iron ore business to support the ramp-up of Gudai-Darri and investment in the pit and health and system reliability. The impact of other cost increases overall was relatively muted, reflecting disciplined cost control across the business. Looking forward, a stronger U.S. dollar represents a decent tailwind to help offset further cost inflation in the second half. Now on to our productivity drive, which is gathering momentum. We continue to successfully roll out the Rio Tinto Safe Production System and have 15 deployments at 11 sites compared to 5 sites at the start of the year. Each deployment addresses a different bottleneck. For example, at IOC and Kennecott, we focused on the concentrator. And at West Angelas, on the drill fleet. We are seeing Rio sustainable improvements in operating performance as well as in safety and employee engagement. To give you an indication, in the half, there has been a 9% year-on-year improvement in average operating times across processing plants and drills at deployment sites versus the same period of 2021. Our focus is to scale it up to a multiyear program covering all assets across the group. And we are on track to meet our 2022 target of 30 deployments at 15 sites, and we'll build on that in 2023.

Let me now hand over to Peter to take you through the financials in detail. Peter, please?

Liam Fitzpatrick from Deutsche Bank. I'll follow the rules, Menno. So 1 question to start with on Simandou. It seems like we're getting successive delays. Can you give a bit more color on what's causing it? Any insights on the sticking points? And are you still committed to participating?

Look, this is a massive project. And you have to align quite a few stakeholders, several joint venture partners from China, ourselves and the government of Guinea. Not an easy negotiation. But it's actually gone pretty fast. And it's my assessment that we're doing very, very well on it. I much rather have tension when you negotiate and then really agree on things. So when you get into execution, you don't suddenly realize, no, I don't like this. And I think that's exactly what is happening now. The government of Guinea has hired really good advisers and has gone through it very, very thoroughly. And of course, there were some issues. And Bold and the whole team is right now in Conakry, and I'm very optimistic. I mean ultimately, you only have an agreement when you have ink on the paper, but it's actually progressing very well.

I have a quick follow-up related to the iron ore market. Are you in a position to maintain current volumes for the foreseeable future, given your cautious outlook, until there is a clear recovery in the market?

Well, right now, we're simply sticking to our guidance. And if you calculate backwards, you will see that, that will require more production in the second half than in the first half. And we feel comfortable about that as we are ramping up Gudai-Darri. But obviously, we will always look at the market conditions, but there is demand for our iron ore.

Richard Hatch, Berenberg. Two questions. First one on ERA, you've talked a little bit about it this morning. Just on the numbers that I can put together, it looks like the rehabs, AUD 1.6 billion to AUD 2.2 billion, it was nearly AUD 1 billion, 86% of the company. It's got about $800 million, $900 million of funding. How should we think about the cash that goes into ERA and over what kind of time period? Because clearly, nobody is going to come in and buy it, so you've got to fund it, so how do we think about that?

Absolutely. Look, we are totally committed to make sure that the rehab will happen and work hand-in-hand with the Traditional Owners, the Mirarr people. But ultimately, you're asking a question that you actually have to ask to the Board of ERA because it's a public-voted company. Obviously, we are a big shareholder, and we are just working with the Board to try to figure out how can we most efficiently funnel in money to do the rehab. But we also have to be respectful for the remaining shareholders who also have to contribute, of course. And that's the dialogue we are going again, but there should be no doubt about the stance of Rio. We stand behind. This will be we have to the higher standards.

And just to follow up just on the dividend, which you've paid above your 40% to 60% range over the last few years given the fact that you've made so much cash. I mean with CapEx increasing and perhaps the outlook being a little bit more uncertain, is it just prudent to assume that over sort of 2023, '24, all things known, that you really revert back to the range, which is 40% to 60%, which I see is basically your last point on the last slide? So is that a sensible way to look at it, 40%, 60%, and don't expect to pay above that?

What do you think, Peter?

I believe the important point is that we are maintaining a consistent payout at this interim stage, which is 50%. If you compare this to the first half of last year, the iron ore price was significantly higher than it is now. We are operating in a different environment, and our decision on payouts will be made at the end of the year when we have all the performance information. The Board will then evaluate the outlook. We are committed to being consistent with our previous practices, so you can expect us to maintain that consistency.

Roberto, can we, please, have the first question from the line, please?

Jakob, Peter, my first question is regarding the spending profile, as the current environment is quite challenging and completing projects is difficult. You spent $3.1 billion in the first half, which suggests that, based on the new guidance of a $9 billion run rate for the second half, is that achievable?

I believe that spending in the second half is typically stronger than in the first half, and this trend has been consistent year-on-year with the $3.1 billion we spent. Additionally, sustaining capital expenditures are at steady levels year-on-year, currently at $3.5 billion. The lower spending was largely due to rephasing some development expenditures and a slower pace in decarbonization spending this year, which will be more back-ended. Therefore, I wouldn't overinterpret the $3.1 billion as a sign of reprofiling. We expect to maintain our future spending within the $9 billion to $10 billion range. There may be some favorable effects from currency exchange, but we are also facing other pressures in the system. We will provide more accurate guidance at the end of the year when we have complete information. As I mentioned, Simandou will be included in that guidance, and the timing of progress will be key to our spending profile.

I mean, Paul, if I should just add 1 thing, I just spent a week in Mongolia. Look, first half, we actually had a lot of COVID restrictions in a number of places. And suddenly, when I was there, the COVID restriction was away, and suddenly, you can just get an awful lot more done. So have that in mind when you look at the numbers as well.

The follow-up question concerns the performance of Pilbara. It appears you are beginning to make progress, and you could be completing your project timelines, while Gudai-Darri is starting to ramp up. This should provide some respite in 2023 before the need for the next set of replacement mines arises. My question specifically pertains to Gudai-Darri. It has taken a considerable amount of time to develop this mine, and I’ve noticed there hasn't been much discussion about Phase 2. This phase seems to be one of the highest returning projects in Pilbara. Can you provide an update on the timing of Gudai-Darri Phase 2? I understand you will mention the need to ramp up Phase 1 first, but I anticipate that will occur fairly quickly in the first half of next year. What can you share about Phase 2?

Yes. Yes, Peter, by all means, I would like to see Phase 2 as well.

Absolutely. So Paul, you're correct. The focus is on ramping up Phase 1. The ramp-up profile we expect is quite similar to other mines we've operated in the Pilbara. We need to progress toward getting Gudai-Darri to 43 million tonnes in the first phase. At the same time, we are beginning studies for the next phase, Phase 2. There are no changes to the profile we are working on.

My first question is on the M&A strategy and broadly speaking, on the lithium strategy. Can you expand on the comments you made on M&A? And do you have an increasing appetite for larger deals? Or are you still happy with your $1 billion or $2 billion smaller acquisitions in lithium? That's the first part of the question.

Yes. No, thank you. It's a very good question. We have a very strong balance sheet, so we have the optionality to do many things. But I tend to focus actually less on that side and more about the organization and the strengths of the organization. I'm very keen on keeping our engineers very busy. But I'm also very keen on not overstretching them. And I think it's great that we have taken on Rincon, and I'm very, very keen on trying to figure out what it would take to find a path forward for the ERA project as well. But there's just the limits on how many new projects we should undertake. So it's a little bit that mindset I have, and therefore, I'm not too excited about doing too many things on the M&A front, but we're looking at it. We have the optionality. And as you have seen for a couple of months, asset prices are going down. And then, of course, it becomes more attractive. But key for us starts with some very basic things. Do we have the capacity to execute the things? What are we adding? Why are we the best owner of the asset? And then the second part of it is, of course, trying to not hit it at the top of the cycle.

And following up on the M&A as well. The acquisition process of Turquoise Hill appears to have exceeded the usual 3 to 4 months for the independent valuators to express a view. Are there any deadlines or milestones that you are working with at the moment? And by when should we expect a breakthrough there?

Yes. We put significant effort into creating a well-priced proposal for our shareholders. The Board took it seriously and initiated the Canadian process, which is quite rigorous. Honestly, I haven't focused on the valuation since then out of respect for that process. The independent committee of the TRQ Board will report back to us, and I will pay close attention to their findings. I believe the market has shifted, with copper assets now trading approximately 40% lower than before, which means our options have changed. I still believe simplifying TRQ is the right strategy, but let's allow them to complete the process first. I understand we are approaching that point, and then we will reassess what is best for our shareholders.

It's Danielle Chigumira from Crédit Suisse. Just a question on the decarbonization spend. So the $1.5 billion next 3 years seems to be a bit more back-end weighted now. Can you talk a bit about your ability to spend that? And also, any commentary around whether the cost as in dollar per tonne of carbon reduced has changed since you outlined the initial strategy last year?

Thanks, Danielle. I think the key is that we set targets for a 15% absolute reduction by 2025 and 50% by 2030. Since then, we have made significant progress in establishing the foundations needed to achieve these goals. We are developing the right capabilities within the organization and conducting essential studies because these projects are central to many of our operations where changes are necessary. It's not something that can be initiated immediately; it requires thorough studies and engineering to devise the appropriate solutions. Right now, I feel that we are effectively building those foundations, and as we move into late this year and into 2023 and 2024, we will begin to focus on those projects and implement them fully. This is why the spending of the $1.5 billion is more back-end weighted. Regarding the costs, we are currently evaluating them, so I wouldn't alter our spending profile at this point. Overall, I believe we are comfortable with the guidance we have provided.

Great. And just a follow-up is on the co-management agreement with the PKKP, what does that mean on an operational basis? Does it mean changing mine plans? Does it mean things take longer to implement? How should we think about that?

This topic is very important to me, and we are now applying it everywhere. It originated from the work of PKKP, and about a year ago, I began discussions on it. It involves the mindset that we are guests in their country and emphasizes collaboration. While signing agreements is part of it, the focus is more on our actions in the field. We've learned that we can achieve much more when we partner closely with Traditional Owners during our field activities. This has proven effective in our operations. Although we didn’t formally recognize this approach at our bauxite operations in Weipa, Queensland, it became clear we needed to enhance our practices in Western Australia. Under this philosophy, we are making significant changes. For instance, in the Gudai-Darri project, we have substantially revised the mine plan by closely listening to the Traditional Owners. Since I had the opportunity to meet with them, I've sensed a shift in sentiment; people are recognizing that we are listening and making adjustments. Our team is busier than ever as we adapt the mine plans, but when we find the right approach, it leads to sustainability and mutual benefits. This isn’t just a concept; it reflects the daily work of our engineers.

Jatinder Goel from BNB Paribas Exane. A question on capital allocation. Relating to your comments, Jakob, you mentioned asset prices have come down. Does that make buy versus build more favorable towards buying because with asset prices, wherever you can transact versus CapEx inflation and the execution challenges that the entire industry is facing? But tying to that, most of your future projects are also strategic than rather optional. Can you do both a sizable M&A plus continue with your organic growth as well?

Yes, you're correct in that respect. However, I look at it a bit differently. We already have a lot in our portfolio, and that's where our focus is. You’ve seen us making significant progress at Oyu Tolgoi. Currently, our team is in Conakry, and I want to see Simandou advance. We have limited capacity to take on additional projects. If we can make progress, it makes sense to concentrate on what we already have, although we are monitoring market conditions. While prices have improved, it's uncertain when market lows will occur; we only recognize that in hindsight.

Just another follow-up on capital allocation. Was net cash balance sheet not strong enough to top up dividend with a special even if you wanted to stick to 50% payout? And then tied to that, you've been constrained from buybacks because of Chinalco shareholding, but that wasn't really a challenge where share price was. But now do you feel you need to find a solution? And is there any discussion with Australian regulators or Chinalco to solve with maybe Chinalco can participate proportionately and you can still kick off with buybacks?

I think in terms of the balance sheet, yes, we had net cash but relatively small net cash. And I always think of it kind of them making a commitment of $4.3 billion, which, as we said, is our second largest interim dividend. So that has to be sort of factored in. So that's really, really in terms of balance sheet. But as we said, we're just being very consistent on the dividend. 50% is our sort of normal level. It's where we placed the ordinary dividend at the half of the year, putting the big decision to the end of the year when we've got full information. So that's on the first. But in terms of buybacks, yes, that we've still got the same situation in terms of constraints on buybacks. And at the moment, no sort of change to that.

Roberto, can we get another question from the line, please?

Just I guess a follow-up to some of the questions previously. Just around your comments on Simandou and the potential timing of that, just looking at the aspirational CapEx for the next '23, '24, sort of $1.5 billion a year. If you're committed to Simandou, would that sort of remove any further options in terms of your capital allocation if you've got the commitments you've already got in the rest of the business? Or is there still going to be scope for other potential new projects to come in?

Thanks very much. When we talk about the $3 billion, we've talked about around as to what we would be willing to sort of commit on around growth. And there's been a number of options we've been sort of working on in parallel. So Simandou is clearly a big component of that. And I said, there's absolutely room within the spend profile to accommodate what we see as potential spend on Simandou to the extent we do sort of land on all the agreements. Would there be room, it depends, as we said, with there's a number of options that we're working on. And so yes, we have flagged some flexibility to accommodate, but it really just depends on timing and exactly when we land these sort of studies on other options.

A follow-up to that would be just on capital allocation between the Pilbara and Simandou and assuming it is approved and goes ahead, I mean do you really start then assessing Pilbara life extension options as opposed to expansions versus more investment in Guinea, pushing Simandou harder?

So far, we have two major iron ore assets, IOC and the Pilbara, and it has been beneficial to analyze each project individually. At some point, I hope we will also have Simandou as a third asset, and we will look at it in an integrated manner. However, the global seaborne iron ore market is 1.9 trillion tonnes, so we need to be cautious about making any statements regarding small gains here or there. Currently, there has been a solid balance between supply and demand for several years, and we must ensure our valuable assets in Western Australia are fully operational and that we are gradually making improvements to avoid falling behind while we also develop Simandou. It's crucial to note that the qualities of the two assets are different, with Simandou being the highest quality iron ore available, comparable only to what has been produced in the northern region of Brazil. This creates the potential for different market opportunities and flexibility in blending strategies. I believe this asset will enhance the competitiveness of our Pilbara operations.

Just a quick question on relationships with China with the new SOE being set up called the China Mineral Resources Group. I'm just wondering how that's going to impact how you think about marketing for your Pilbara business as well as negotiations with the joint venture partners on Simandou. Arguably now they come under 1 banner, and so we'll have a much more united approach. And so I'm just wondering how you're preparing your business for that change in market power.

Yes. No, thank you. Look, I think we need to step back and figure out what is fact and what is rumors. I mean we all know that there was an inaugural meeting of this entity the day before yesterday with senior representation in China. But how they will act in the market is rumors, and I don't want to speculate on that. I have no particular concern. We have worked for the last 50 years successfully with China for the benefit of Rio Tinto. And I believe we have also been helpful in China developing the steel industry, so I'm very confident that, that will continue.

And just a follow-up. There's a change in the market structure that provides an additional motivation to invest in your business in Australia and Simandou to increase volumes. If you don’t take advantage of this, could it indicate a shift in strategy?

Well, certainly, we have not changed a single decision within Rio Tinto based upon the market rumors about this. So no, I cannot see that linkage.

Just in regards to the decarbonization CapEx of $7.5 billion out to 2030, I guess it's now been some time since that was first announced. I'm wondering if you're able to share the potential returns on that number. I guess BHP has talked about the $4 billion spend with a negative $0.5 billion NPV. They're an equivalent number we can think about for Rio's spend. And I guess the next question I had was related to Slide 40. I was just interested to see the idea of using civil size trucks in iron ore. And I'm wondering if you can maybe talk a bit more about this slide and when this project might be rolled out and, I guess, when we might be able to see 0 emission mining trucks within the Rio business.

That's a wonderful question that I happily pass on to Peter because I also like to know exactly the profitability. But I will say one thing. What has changed since last year is that the price of gas has gone up, the price of oil has gone up, and therefore, all else equal, the economics of renewable becomes better. But Peter?

I would like to return to what I mentioned at the seminar regarding the moderate carbon price, which we view as beneficial to our value. It's important to focus on the reduction of risk in our business and cash flows by lowering our carbon intensity. This effort aims for a 50% absolute reduction, making our business more resilient amid changes and decarbonization compared to before. It also positions us to seize opportunities, as much of the discussion revolves around the costs of decarbonization. However, our portfolio reveals more opportunities, as the decarbonization landscape will require more of the products we create. We need to approach this holistically. Our initiatives not only enhance our business resilience but also align our goals with Scope 1 and 2 reductions while enabling us to adapt to changing markets and leverage the significant transformations taking place globally. Regarding the trucks, I apologize for the delay. It will take some time to understand the path forward for the trucks. Currently, we are in the research and development phase, collaborating with original equipment manufacturers, so it will require time to progress.

Great. Just first of all, maybe on the balance sheet, so Peter, you mentioned that we will see net cash moved to net debt in the second half of the year. Could you give us a sense where you think net debt should ideally sit? Is it in that $5 billion, $10 billion, $15 billion range? You talked around a strong balance sheet, but what does that mean in terms of absolute levels of net debt? That's the first question.

Myles, I won't specify numbers because they change throughout the cycle. When prices are as volatile as they are now—like the iron ore price last year, which was over $200 a tonne and is now about half that—setting targets and managing them is quite difficult. Our view is that having a strong balance sheet provides significant flexibility and strategic options, allowing us to operate and drive the business consistently regardless of the cycle. While we might not maintain net cash normally, we will keep our net debt at a robust level, as we believe that's the right approach for managing a balance sheet in this industry.

Okay. Maybe just on the CapEx as well because I think it's a little bit concerning when we look at the cycle, look at where commodity prices are, obviously, look at the uncertainty around China. And then we still hear that you're looking to increase CapEx by sort of potentially over $2 billion year-on-year in 2029. And obviously, that will have quite meaningful kind of implications for the amount of cash that can be returned to shareholders. But how much flexibility do you see within your CapEx overall? Normally, in a down cycle, we see sustaining CapEx come down. We see kind of growth projects kind of sort of moderate and sell on. But how should we think about your CapEx in this cycle? Is it going to be more kind of resilient as you invest through the cycle, and that impacts cash returns? Or will there be more flex than it looks like in your charts?

So allow me to open up here on the CFO question, but look, this is actually really fundamental. If we start adjusting our CapEx program because we think there is a recession in the next 6 months, we have lost it. We are in for the long haul here. In fact, if you really think about it, the best thing is to invest when you have a recession because that's where you can buy services cheap. We are absolutely convinced that we have the right investment profile going forward. And whether there's going to be a tailwind or headwind, it should not affect the things. Obviously, sometimes things become a little bit more expensive when you get inflation, and we need to manage that very carefully, but we fundamentally want to carry out the activities that we have planned to do.

Myles, everything relates to maintaining a strong balance sheet, which allows us to be consistent investors. Ultimately, we aim to sustain capital within our business to uphold the integrity and productive capacity of our assets throughout economic cycles. We need to invest in our development and replacement assets as discussed, to ensure our cash flow remains robust over the long term. Looking ahead, we are optimistic about future market conditions and intend to leverage our value-enhancing growth opportunities, ensuring consistency throughout the cycle.

So it's encouraging to see some improvement in IOC in the quarter. Can you remind us what the remaining bottlenecks are at that project and so we can get a sense of when potentially you could be up to the full capacity there? And is it a case that you need to put this HBI investment in place to actually get to that full capacity?

Yes. Look, IOC is close to my heart as a business. I think it's a wonderful asset, but we have probably run it pretty tight for many years, and it needs a little bit of care. Second quarter has been really, really encouraging. In fact, we had a couple of really, really good months in April and May. But then we had a longer shutdown in June and therefore on average is kind of a little bit of an improvement. I'm very, very encouraged, both with the new CEO and the management team there and how they're going about it. So it will come back to full capacity, but I don't want to predict the time of it because when you're dealing with the aged mining assets, there is no linear development. There might be a few setbacks underway. But they're doing the right things right now. I think it's pretty good, yes.

Let's come back to the room. Danielle? It's Danielle Chigumira from Crédit Suisse. Just a question on the decarbonization spend. So the $1.5 billion next 3 years seems to be a bit more back-end weighted now. Can you talk a bit about your ability to spend that? And also, any commentary around whether the cost as in dollar per tonne of carbon reduced has changed since you outlined the initial strategy last year?

Look, yes, I don't know whether it takes that much longer. I think we always have to fight bottlenecks within ourselves. I think it's more work to do mine plans. That's for sure. And you will have bottlenecks within your own company. You will have bottlenecks in terms of capacity of participation from the Traditional Owners. You also have bottlenecks in state governments to get approvals, et cetera. But how much longer, we have always had that in a way. And I think the trick is to not see them going longer. Time will tell. But what I see is that we are progressing. For example, the Western Range, I'm actually very impressed. We have, quite frankly, been a bit slow on Western Range for many years. And now lately, we have really progressed it fast. And I think that is actually telling is not about slowing down things to work with the Traditional Owners, is actually there, you can find solutions and move forward.

Okay. Thank you very much, everybody, for listening, and thank you for coming here in London. And see you next time. Bye-bye.