Anglo-Australian miner Rio Tinto PLC (RIO) said Friday more investment needs to be made in new coking coal projects to satisfy robust demand for the steelmaking raw ingredient.

"Metallurgical coal supply will require significant green field expansions to meet strong demand," the company said in a presentation on its website.

Coking coal demand is forecast to grow at a compounded annual growth rate of 5.9% between 2011 and 2020, Rio Tinto said based on data provided by Wood Mackenzie and RTE.

"Global coking coal demand is looking robust due to urbanization and industrialization in India and China ," it added.

Fast-paced coking coal demand growth will require 88 million metric tons of new production capacity from green field projects between now and 2020 to meet demand growth, a graph from the company's presentation showed.

Rio Tinto already produces coking coal from its coal assets in Queensland Australia and its 75% stake in Australia-based Coal & Allied Industries Ltd. (CNA.AU). Rio is now seeking to expand its coal foot print by acquiring Mozambique-focused coal producer Riversdale Mining Ltd. (RIV.AU) for nearly A$4 billion and pursuing organic growth projects.

Rio last week raised its offer for Australia 's Riversdale and so far has received acceptances equivalent to over 33.04% of Riversdale voting rights. The offer is conditional on Rio obtaining a more than 50% stake in Riversdale by March 23, although the bid will remain open until April 1.

Rio said that its energy division, which produces coking coal, thermal coal and uranium, is very profitable and will continue to be a core part of the group's business strategy. The energy division's underlying earnings rose 1.7% to $1.19 billion in 2010 and accounted for 6% of the group's total underlying earnings.

Demand for thermal coal and uranium, energy products used to power thermal plants and nuclear power plants respectively, will continue to rise, the company said.

Thermal coal demand is forecast to grow at a compounded annual growth rate of 1.8% a year between 2008 and 2030 and will account for about 29% of the world's primary energy demand in 2030 up from 27% in 2008, Rio Tinto said citing the International Energy Agency's latest World Energy Outlook current policy scenario.

Meanwhile uranium demand is forecast to rise at a compounded annual growth rate of 1.7% during the same time period and account for 6% of the world's primary energy demand in 2030, unchanged from 2008.

The company made no mention in the presentation about the nuclear problems at Japan 's crippled Fukushima Daiichi nuclear facility or whether it would have any bearing on the company's future uranium investment decisions.

Rio Tinto has interests in two uranium mines: a 68% stake in Energy Resources of Australia Ltd .(ERA.AU) in Australia and a 69% stake in the Roessing mine in Namibia .

Analysts expect thermal coal demand will rise in the wake of Japan 's nuclear crisis.

"We believe there is approximately 55 gigawatts of nuclear capacity at threat between now and 2020. Most of this comes from Japan (46GW), where damaged Japanese capacity may not be reopened and old plant operating licenses may not be extended," Citigroup said in a note.

"Elsewhere, in Germany , we believe the possibility of the temporarily closed nuclear plants being permanently closed is high. This could have significant implications for the coal industry." the bank added.

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