Anglo-Australian mining giant Rio Tinto's attempt to ram through a sale of up to 18% of the company to the Chinese was dealt another hammer blow today as one of Australia's most influential politicians kicked off a campaign to oppose it.

Former finance minister Peter Costello, who famously blocked the sale of Australia's Woodside Petroleum to Shell in 2001 on the grounds of national interest, today urged the current government to put tough conditions on the controversial sale of Rio assets to Chinese state-owned Chinalco. He implied he favoured an outright block on the deal.

Although he is now in opposition, his comments will add pressure to the government when it considers the regulatory aspects of the deal.

Rio Tinto chief executive Tom Albanese this week cancelled a trip to meet investors in Sydney as he focused on selling the widely unpopular deal to London institutions. But the Rio team is keenly aware of the danger of the Chinalco deal being derailed by Australian politicians.

It is one of many factors that could kill off the bid - factors highlighted by the almost unprecedented resignation last week of highly regarded chairman-elect Jim Leng over his opposition to it.

Leng quit after hearing shareholders' anger at a deal they say unnecessarily hands over too much power to Chinalco.