BHP Billiton yesterday brushed aside reports that its proposed $116bn Western Australian iron ore joint venture with Rio Tinto is in difficulty only weeks before a deadline for the mining groups to conclude a “definitive agreement”.

Rio's financial position has improved markedly in the five months since it struck the production joint venture with its arch rival and former hostile suitor.

There are concerns that the London-based group is not being sufficiently well compensated for pooling its superior iron ore infrastructure assets with BHP's.

Don Argus, who will step down as BHP chairman early next year, told shareholders at the annual meeting in Brisbane that executives at the top of both mining groups were committed to the deal.

“There is commentary . . . of people not being supportive of it, but that is not the case from within both parties and it is certainly not the case from the majority of shareholders,” Mr Argus said. “This just makes sense.”

BHP and Rio estimate that the joint venture will save at least $10bn from production and development synergies.

Rio has said that the mining groups plan to convert their in-principle agreement into a binding deal by December 5.

However, Marius Kloppers, BHP chief executive, said yesterday that, although Rio had put out a date, “we have always just said towards the end of the year and I see no reason to update that”.

He added that the core principles were yet to be completed and some additions would be made.

BHP also told shareholders that market conditions had improved in the month since it held its annual meeting in London.

“The velocity of the recovery in China has indeed been surprising,” Mr Kloppers said.

But he cautioned that BHP was expected to emerge from the downturn “less strongly than in previous cycles”.