Diamond giant Rio Tinto posted its second quarter operational review, noting a recovery in diamonds and minerals production.

According to the miner, production at Argyle returned to normal levels following the maintenance shut down at the processing facilities in the second quarter of 2009.

At Diavik, ore processed during the second quarter increased by 37%, but more ore was sourced from the lower grade A418 pit, resulting in a 13% increase in carat production.

Chief executive Tom Albanese said: “2010 continues to shape up well for Rio Tinto and we are driving our operations at close to capacity. Markets for most of our products are strong and the overall long term demand outlook is positive.

"But in recent weeks, fears about a possible double-dip recession in OECD countries and a slight slowdown in Chinese growth have led to some weakening in sentiment. We believe this pattern of volatility in the global economy is set to continue.

“Growth is firmly back on our agenda. We have a large range of options for expansion and investment competing for capital," he added. "Now that much of the uncertainty over the Australian resource tax has been removed, we are starting to move ahead with projects there with the announcement today of $200 million of funding to prepare for the expansion of our Pilbara operations to 330 million tons a year.”