Norway is banning its sovereign wealth fund from investing in Anglo-Australian mining firm Rio Tinto because of environmental concerns.

The country's finance minister Kirsten Halvorsen said the £500m stake held by the country's "oil fund" would be sold.

She said the ban stems from concerns over Rio's investment in goldmine in Papua, Indonesia, which was responsible for river pollution.

Rio said that it had an exemplary record in environmental matters.

Rio Tinto owns 40% of Papua's Grasberg gold and copper mine, which is operated by US-based Freeport McMoRan.

"We do not want to contribute to serious environmental damage," Ms Halvorsen said.

"The Grasberg mine discharges very large amounts of tailings directly into a natural river system; approximately 230,000 tonnes or more per day."

A spokesman for Rio Tinto said that the current system for disposal of tailings - or mining waste - was the most appropriate given high rainfall and seismically unstable geology in the area.

Continued at BBC Business