Sydney  - Anglo-Australian mining firm Rio Tinto Ltd's plans to sell a 19-per-cent stake to China's state-backed aluminium group Chinalco for 20 billion US dollars to shore up its balance sheet would need government approval, Treasurer Wayne Swan said Thursday.

"Any deal would be examined by the Foreign Investment Review Board," Swan said. "They will be examined in the normal way within the guidelines that we put out at the beginning of last year."

The board has the power to block foreign investments it considers not in Australia's national interest. Last year, the government said it was particularly concerned about sovereign-fund investment vehicles purchasing slices of Australia's resources industry.

Rio Tinto, the world's second-biggest mining company after Anglo- Australian rival BHP Billiton, took on enormous debt to buy aluminium rival Alcan two years ago and is now obliged to seek more capital.

BHP Billiton abandoned a hostile takeover bid for Rio Tinto in November, citing concern about taking on too much debt at a time when the world economy is in a debt-driven crisis.

Rio Tinto confirmed it was in talks with Chinalco and asked for its shares to be placed in a trading halt.

"Rio Tinto notes continued media speculation in connection with a possible transaction with Chinalco and confirms the parties are in negotiations, which may or may not lead to any agreement being reached," the company said in a statement. (dpa)