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Rio Tinto : Turquoise Hill raises funding estimate for Mongolia mine by $1.2 billion

10/14/2021 | 06:28pm

(Reuters) - Canadian miner Turquoise Hill Resources Ltd said on Thursday the estimated additional funding required for the Oyu Tolgoi mine in Mongolia was now $1.2 billion higher than previously expected due to some delays.

Oyu Tolgoi, one of the world's largest copper-gold-silver mines, was at the center of a long-running funding spat between Rio Tinto, and Turquoise.

Costs for expansions at the mine have ballooned over time and caused friction between the two companies. The Mongolian government holds a 34% stake in the Oyu Tolgoi project with Rio's majority-owned Turquoise owning the rest.

Delays in underground mining as well as open-pit metal deferring have caused an increase in estimated incremental funding requirement to $3.6 billion from the $2.4 billion expected in July.

Metal production from open-pit mining is expected to be delayed to beyond 2024, the company said, partly due to on-going impacts of on-site COVID-19 curbs that has resulted in delayed waste movement.

Underground development progress was also hit by the COVID-19 constraints on-site and in Mongolia, Turquoise Hill added.

The company also said its copper production rose 16% to 41,935 tonnes in the third quarter from a year ago, while gold more than tripled to 130,799 ounces.

It also said copper and gold production guidance for 2021 remains within the ranges of 150,000 to 180,000 tonnes and 400,000 to 480,000 ounces respectively.

(Reporting by Ruhi Soni in Bengaluru; Editing by Shailesh Kuber)

© Reuters 2021
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