BHP-Rio quiet on Pilbara merger deadline

BHP Billiton and Rio Tinto are remaining quiet over their proposed Pilbara iron ore joint venture, a day before a binding merger agreement is due to be delivered.

Both miners are feverishly working to a self-imposed December 5 deadline to produce an agreement that will lay the foundation for the iron ore joint venture, which is expected to deliver more than $US10 billion in synergies.

The mining giants announced the Pilbara merger in June this year, and had given each other six months to execute binding agreements or terminate the proposed merger.

Under the merger proposal, both companies would equally own the entity charged with overseeing the combined Pilbara assets, with Rio Tinto Iron Ore chief Sam Walsh to be the initial chairman and BHP Iron Ore president Ian Ashby the chief executive.

As part of the merger deal, BHP had agreed to pay Rio Tinto $US5.8 billion to equalize the interests.

During the past six months, both companies have been ramping up their respective Pilbara iron ore expansion projects and recently announced they would not be jointly marketing the iron ore.

BHP and Rio Tinto have been looking to merge their Pilbara iron ore interests for more than a decade.

The deal has been controversial, with Asian steel mills, major buyers of the iron ore, saying it could give the mining giants too much market power.

Rio Tinto is the world's second biggest iron ore producer and BHP Billiton is the No.3.

If the two companies can agree on specifics in the deal, it still must be approved by regulators before it can proceed.