Cynthia Carroll. Picture: MARTIN RHODES
Cynthia Carroll. Picture: MARTIN RHODES

MINAS-RIO, Anglo American's troubled iron-ore project in Brazil, will be the big money-spinner for the group when it reaches full operation in 2016.

The project, which many analysts say led to pressure on CEO Cynthia Carroll to resign, caused her "the most headaches" but will be her legacy at Anglo.

Carroll said in an interview: "We've been given a lot of grief [over Minas-Rio], but it will be one of the best things we've done."

The project, which Carroll bought for $5.5bin in her first deal after joining Anglo in 2007, was originally expected to cost $3.6-billion and be completed by the end of 2010. Production is now forecast to start at the end of 2014, with a capital expenditure budget of $8.8-billion.

"There is no way we could've anticipated how the regulatory environment would have been changing in Brazil. My mandate when I was appointed was to pursue iron ore. We bought into Minas-Rio as a partner when the estimated resource was 1.2billion tons; it is now 5.8billion tons. It is one of the largest undeveloped high-quality iron ore reserves in the world," Carroll said.

At current prices, the project will contribute as much as $3-billion a year to the company's cash flow, Carroll said. "It will be the single-largest operational contributor to Anglo."

Production will be ramped up to 26.5million tons a year by 2016, with production costing around $30 a ton. Iron ore prices, delivered to China, are currently about $150 a ton.

Carroll steps down as CEO on April 3 and will be succeeded by AngloGold Ashanti CEO Mark Cutifani.