Rio Tinto reported a near tripling of annual earnings, rising by $US10bn, due mainly to surging iron ore prices and demand from China.

The Anglo-Australian miner reported net profit for the 2010 calendar year of $US14.32bn, up 194% from $US4.87bn in 2009.

Chairman Jan du Plessis said the company was in a significant growth phase and had multiple opportunities to pursue with its strengthened balance sheet.

It had pared its mostly Alcan acquisition-related debt back to $US4.3bn at December 31, down 77% from $US18.9bn a year before.

Chief executive Tom Albanese said: “Rio Tinto is reinvigorated, running strongly and benefiting from favourable markets.”

“We have embarked on Australia’s largest fully integrated mining project through the expansion of our iron ore business in the Pilbara towards 283Mt/y by 2013, and continue to finalise studies into the phase two expansion to 333Mt/y by 2015.”

The company also announced a $5bn share buyback and a larger-than-expected rise in its dividend.

In a separate statement Rio said it was investing more than $1bn at its iron ore operations in Australia and Canada.

It has approved a $US933M investment to extend the life of the Marandoo iron ore mine by 16 years to 2030 and given a further $US277M to increase the Iron Ore Company (IOC) of Canada's concentrate production capacity by 40% to 26Mt/y.

The project will extend the Marandoo mine life at its current mining rate of 15Mt/y by developing the adjacent reserves below the water table.

Phase two of the IOC project will increase its spiral concentrate and magnetic concentrate production capacity by 1.3Mt/y to 23.3Mt/y from 2013.