Rio Tinto hopeful of Mongolian go-ahead on Oyu Tolgoi copper exports

Mining News  |  2013-05-10 03:34:58   |   By

The global miner Rio Tinto affirmed that it is hopeful of receiving a final nod from Mongolian authorities towards commencement of shipment of copper stockpiles from the contentious Oyu Tolgoi mines in south Gobi desert

SYDNEY (Scrap Monster) : The global miner Rio Tinto affirmed that it is hopeful of receiving a final nod from Mongolian authorities towards commencement of shipment of copper stockpiles from the contentious Oyu Tolgoi mines in south Gobi desert.

The global miner had been caught in negotiation deadlock with Mongolian government over rising cost concerns. According to the company sources, an approval for transportation and shipment of copper from the mine is expected in a couple of week’s time. If everything works out as per plans, the company would be able to start commercial production well ahead of the earlier set June end deadline.

The flow of copper concentrates out of the huge mine is reported to offset the production losses due to supply disruptions  at the landslide-hit Utah Bingham Canyon copper mines in the US. The company has successfully reinstated the conveyor facilities and is reported to have commenced the ore shipments in reduced quantities. Rio Tinto counts on the Mongolian copper mine to make up the huge losses from its US operations.

Mongolian Government had signed a deal in 2009 with Rio Tinto-the owner of the mine and Turquoise Hill Resources-the operator appointed by Rio Tinto. As per the deal, Mongolia has 34% stake in the project, which may be further raised to 50% upon 30 years of operation of the mine. The 66% stake is held by Rio Tinto. Turquoise Hill is believed to have made around $ 6 billion investment in the mines so far.

Over the anticipated 45 years lifespan of the mine , Oyu Tolgoi is scheduled to produce 450,000 tonnes of copper and 330,000 ounces of gold annually.