Rio Tinto confirms development capital and timeline for Oyu Tolgoi underground
December 16 2020 - 02:36AM
Business Wire
Rio Tinto today unveiled a pathway for the ongoing development
of the underground project at Oyu Tolgoi in Mongolia, one of the
largest known copper and gold deposits in the world. The definitive
estimate details how Oyu Tolgoi underground will achieve
sustainable production for Panel 0 by October 2022 for development
capital of $6.75 billion.
Rio Tinto and its partners, the Government of Mongolia and
Turquoise Hill Resources (TRQ), need to continue to work together
to finalise three other milestones – the outstanding government
approvals, funding and a power solution – in order to ensure that
the project can commence caving operations in 2021. This will
unlock the most valuable part of Oyu Tolgoi, delivering significant
benefits for the shareholders of Oyu Tolgoi and the people of
Mongolia.
At peak production, Oyu Tolgoi is expected to operate in the
first quartile of the copper cash cost curve1 and by 2030 is
expected to be the fourth largest copper mine in the world.
Oyu Tolgoi is expected to produce 480,000 tonnes2 of copper per
year on average from 2028 to 2036 from the open pit and
underground, compared with 146,300 tonnes3 in 2019 from the open
pit. The underground Ore Reserve has an average copper grade of
1.52 per cent, which is more than three times higher than the open
pit Ore Reserve, and contains 0.31 grammes per tonne of gold.4 The
size and quality of this Tier 1 asset provides additional expansion
options, which could see production sustained for many decades.
Arnaud Soirat, Chief Executive of Copper & Diamonds said,
“We now have a pathway to bring the underground project into
production, which will unlock the most valuable part of Oyu Tolgoi.
We will continue to work together with the Government of Mongolia
and TRQ to progress the project, including finalising all necessary
approvals and agreeing a solution on power and funding.”
This is a summary. The full notice is available here:
https://www.riotinto.com/-/media/Content/Documents/News/RT-development-OT-underground-2020.pdf
Note to editors
Oyu Tolgoi is jointly owned by the Government of Mongolia (34
per cent) and Turquoise Hill Resources (66 per cent, of which Rio
Tinto owns a controlling interest of 50.8 per cent). Rio Tinto has
been the manager of the Oyu Tolgoi project since 2010.
The open-pit mine was completed in less than 24 months and
production started in 2013. Since then, more than 240 million
tonnes of ore have been milled, with over one million tonnes of
copper in concentrate sold.
This announcement is authorised for release to the market by Rio
Tinto’s Group Company Secretary.
1 WoodMackenzie copper equivalent cash cost curve (Q3 2020).
2 This production target (stated as recovered metal) for the Oyu
Tolgoi underground and open pit mines is underpinned 22 per cent by
Proved Ore Reserves and 78 per cent by Probable Ore Reserves for
the years 2028-2036, which have been scheduled from current mine
designs by Competent Persons in accordance with the requirements of
the Australasian Code for Reporting of Exploration Results,
Minerals Resources and Ore Reserves, 2012 Edition (the JORC
code).
3 Rio Tinto Fourth Quarter Operations Review, published 17
January 2020
4 The Ore Reserves for Hugo Dummett North and Hugo Dummett North
Extension are reflected in Table A below.
View source
version on businesswire.com: https://www.businesswire.com/news/home/20201215006219/en/
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