Rocky road for Rio in developing world

Rocky road for Rio in developing world: "First sales from Mongolia's Oyu Tolgoi copper and gold mine were expected to be celebrated on Friday, after Rio staff sent out invitations to guests - including the Mongolian Prime Minister - to attend a ceremony for the milestone.

Rio has had to fight all the way for Oyu Tolgoi, through a bitter takeover of Robert Friedland's Ivanhoe Mines, shortages of infrastructure and water, and numerous attempts by the Mongolian government to nationalise more of the mine's wealth.

Apart from the first sales, the ceremony was seen as a proxy for demonstrating improved relations between Rio and the government, as Rio had previously warned that strained relations could delay first shipments beyond the June target.

By Wednesday the ceremony had been cancelled, with Rio refusing to explain why. But sources close to Oyu Tolgoi suggest a ceremony is still likely before June 30."

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Mongolia still has '22 points of dispute' with Rio Tinto over Oyu Tolgoi | MINING.com

Mongolia still has '22 points of dispute' with Rio Tinto over Oyu Tolgoi | MINING.com: "While copper shipments have now started, the long-running dispute between the Mongolian government and Rio Tinto (LON:RIO) over the massive Oyu Tolgoi copper-gold mine continues to drag on.

Mongolia owns 34% of Oyu Tolgoi located in the South Gobi desert and Reuters reports Tserenbat Sedvanchig, executive director of Erdenes Oyu Tolgoi, said the government still has "22 points of dispute.""

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Mongolia’s trade balance to show profit in 2014 | Ubpost News

Mongolia’s trade balance to show profit in 2014 | Ubpost News: "The Mongolian Parliament estimated that Mongolia’s foreign trade balance will be positive in 2014, for the first time in five years. Oyu Tolgoi’s extraction is expected to play the main role in positivity.
In detail, the foreign trade commodity turnover of Mongolia is estimated to be 16.7 billion USD in 2014, and 8.4 million USD of it will be of export, while the remaining 8.3 million USD will be of import according to Ministry of Economic Development’s estimate.
Thus, Mongolia’s foreign trade balance (FTB) will be positive and will reach 32.6 million USD. Export will rise by 31.9 percent while import will rise by 14.1 percent in 2014."

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Rio faces more hurdles at Oyu Tolgoi, Mongolia shareholder says | Reuters

Rio faces more hurdles at Oyu Tolgoi, Mongolia shareholder says | Reuters: "Rio Tinto faces lingering disputes with the Mongolian government over its Oyu Tolgoi copper mine, said a director of the state company that owns a third of the mine, highlighting risks confronting the massive project.

According to Tserenbat Sedvanchig, executive director of Erdenes Oyu Tolgoi, the government still has 22 points of dispute with Rio Tinto, operator of the project which is expected to boost the country's economy by 35 percent by 2020.

Grievances include "four issues related to violations of Mongolia legislation and the investment agreement," he said, adding that capital expenditure was the biggest issue."

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Special report: In tax case, Mongolia is the mouse that roared | Reuters

Special report: In tax case, Mongolia is the mouse that roared | Reuters: "Turquoise Hill Netherlands is a little-known Amsterdam-based company with three employees, no office, and not even its own mailbox. To the government of Mongolia, though, the company represents billions in taxes that it will never see.

Turquoise Hill was created in 2009, five years after Mongolia and the Netherlands signed a tax treaty to avoid double taxation and boost investment in Mongolia. But in 2011, Mongolia decided to cancel the pact, arguing that it would cost the country income from one of the most lucrative gold and copper mines in the world."

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Rio Tinto Oyu Tolgoi mine held up by export income dispute - 3

Rio Tinto Oyu Tolgoi mine held up by export income dispute - 3: "Reuters reported that the Mongolian government and Rio Tinto have not yet reached an agreement on whether the miner can repatriate earnings from the USD 6.2 billion Oyu Tolgoi mine delaying first copper shipments.

The dispute could heighten investor concerns about the risks of mining in Mongolia and threaten Rio Tinto’s plans to grow its copper portfolio to ease dependence on iron ore.

Metals traders have been closely watching whether Rio gets official approval to export concentrate from Oyu Tolgoi amid a shortfall in shipments from the Grasberg mine in Indonesia run by Freeport McMoRan Copper & Gold."

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Mongolia Says Rio’s Copper Mine Can Start Shipments (Correct) - Businessweek

Mongolia Says Rio’s Copper Mine Can Start Shipments (Correct) - Businessweek: "Tensions between Mongolia’s government and Rio Tinto Group (RIO) over the $6.6 billion Oyu Tolgoi mine have eased sufficiently to start shipping copper concentrate this week, the country’s mining minister wrote in a post on Twitter today.

“There is no significant problem with the Oyu Tolgoi mineral export contract,” Davaajav Gankhuyag said. “The first shipments will start on July 9.”

Scheduled shipments to Chinese smelters were postponed twice, first on June 14 at the request of Rio Tinto, then on June 21 at the request of the government. Rio runs the operation through its Turquoise Hill Resources Ltd. (TRQ) unit, which holds a 66 percent stake. Mongolia owns 34 percent."

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Oyu Tolgoi to start copper exports on July 9 – Mongolia

Oyu Tolgoi to start copper exports on July 9 – Mongolia: "ULAN BATOR – Rio Tinto will start exporting copper from the $6.2-billion Oyu Tolgoi mine in Mongolia on Tuesday, the Mongolian government said, but it was not clear if the miner would be able to repatriate sales revenue from the mine.

The unlocking of ore shipments is key for Rio to secure a further $4-billion in project funding for the expansion of the mine, which will significantly boost the Anglo-Australian miner's copper portfolio and ease its dependence on iron-ore.

Rio Tinto, operator of the mine, declined to comment, citing the number of false starts. First exports from the mine have been delayed twice since the initial planned date of June 14.

Metals traders have been closely watching whether Rio gets official approval to export concentrate from Oyu Tolgoi amid a shortfall in shipments from the Grasberg mine in Indonesia, run by Freeport McMoRan Copper & Gold."

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Rio Tinto's Mongolian Saga Brightens: Outlook Going Forward - Seeking Alpha

Rio Tinto's Mongolian Saga Brightens: Outlook Going Forward - Seeking Alpha: "On Tuesday morning July 9, the first shipment of copper concentrates from the rich site at Oyu Tolgoi (OT) in southern Mongolia left for China fifty miles to the south. It was an exciting day and perhaps an inflection point for Turquoise Hill Resources (TRQ) which owns OT 66-34% with the GOM (Government of Mongolia). One must mention politics and the government up front in discussing these matters for resource nationalism has been a large part of OT's development for years. Mining giant Rio Tinto (RIO) bought a majority interest in OT from Robert Friedland and Ivanhoe Mines in January 2012, upped its holdings in July 2012 and changed management. RIO controls OT through its 51% share in TRQ.

OT is expected to produce 330k tons of Cu (copper) / year and 495k oz. gold. When Phase I development is complete it will become one of the world's top-five copper sites, vying with the Escondida mine in Chile and Freeport McMoRan's (FCX) Grasberg District in Indonesia."

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Rio Tinto Starts Shipping Copper From Mongolia Mine - WSJ.com

Rio Tinto Starts Shipping Copper From Mongolia Mine - WSJ.com: "MELBOURNE--Rio Tinto PLC (RIO) on Tuesday began exporting copper from its $6.2 billion Oyu Tolgoi mine in Mongolia, a sign tensions between the government and the mining company have eased since the incumbent president won a second term in office.

Oyu Tolgoi is central to Rio Tinto's efforts to source new mineral supplies in developing resource hotspots and to reduce its dependence on iron ore, which accounts for about 80% of its earnings. It is also vital to Mongolia and the mining company has estimated it will account for more than 30% of the country's gross domestic product when it reaches full production in 2020.

"With continued development, Oyu Tolgoi will generate wealth for many decades to come," said Jean-Sebastien Jacques, chief executive of the Anglo-Australian mining company's copper division in a statement."

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Giant Mongolia mine starts copper exports - Central & South Asia - Al Jazeera English

Giant Mongolia mine starts copper exports - Central & South Asia - Al Jazeera English: "Copper concentrate exports have started to leave Mongolia's giant Oyu Tolgoi mine for China after repeated delays.

Mine operator Rio Tinto, which helped fund Oyu Tolgoi's $6.2bn development cost, said that the mine known as OT was expected to make up a third of Mongolia's economy by 2020.

Rio Tinto also said that at full tilt OT would produce about 450,000 tonnes of copper and 330,000 ounces of gold a year.

"Oyu Tolgoi starts production at a time when undeveloped quality copper assets are scarce and the outlook for copper continues to be strong," the Anglo-Australian mining giant said on Tuesday."

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Rio Tinto Mongolia agree to continue funding Oyu-Tolgoi

http://www.amm.com/Article/3163795/Nonferrous/Rio-Tinto-Mongolia-agree-to-continue-funding-Oyu-Tolgoi.html 

Mongolia: Fast growing economy, evolving investment climate

Mongolia: Fast growing economy, evolving investment climate: "There are two world class mines that hold the key to economic success in Mongolia, namely Tavan Tolgoi, one of the world's largest coking coal deposits, and Oyu Tolgoi, the largest underdeveloped copper/gold project. The IMF estimated that export proceeds from these two mines could total US$2 billion in 2013, rising to US$7 billion by 2020, while Mongolia’s GDP in 2011 was only $8.8 billion.

With the expected $3 billion Tavan Tolgoi IPO this year and commercial production of Oyu Tolgoi to commence in first half 2013, it appears the Mongolia economy is poised to maintain good momentum. Mongolia’s average real GDP growth is projected to be 13.4% annually over the coming 5 years due to mining initiatives, according to IMF’s World Economic Outlook 2012."

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Rio Tinto hits rivers of trouble in Mongolia’s mines

Rio Tinto hits rivers of trouble in Mongolia’s mines: "At the start of the year things looked terrific. After years of creeping up the share register it had finally secured a majority stake in Ivanhoe, its Canadian joint venture party in what will shortly become Mongolia’s largest mine: the Oyu Tolgoi copper and gold deposit. All it had to do was to secure an electricity supply from China, just across the border from the mine in the South Gobi Desert. Ten months later there are new laws in front of the Mongolian government which would raise royalties paid by all foreign mining companies."

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G. Batsukh: Mongolia earns more than the investors in the form of taxes, royalties and other fees despite only owning 34 percent of Oyu Tolgoi | Ubpost News

G. Batsukh: Mongolia earns more than the investors in the form of taxes, royalties and other fees despite only owning 34 percent of Oyu Tolgoi | Ubpost News: "The following interview is with G. Batsukh, Chairman of Oyu Tolgoi LLC Board of Directors.
-There are rumors that the Mongolian members of the Board of Directors left during the meeting and there’s a chance that they will not come back to next meetings because of disagreements with other members. What is the reason for this?"

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Mongolia learning from Aus how to make most of mining boom | Clarence Valley Daily Examiner

Mongolia learning from Aus how to make most of mining boom | Clarence Valley Daily Examiner: "AS IT prepares to face the corporate hordes keen for its minerals, Mongolian government officials have headed for Australia to learn how to make the most of it.

The developing Asian nation, on the doorstep of a resource-hungry China, has an exploding industry funded in part by billions of dollars from multi-national mining firm Rio Tinto.

When the Oyu Tolgoi [corr]copper and gold project reaches peak production in 2018, it will supply one-third of the country's gross domestic product.

With this in mind, Mongolia must carefully choose its path because other developing nations have squandered opportunities of this scale, finding themselves poorer, not richer, once these minerals are exhausted."

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Mongolian mine to affect water supply?

Mongolian mine to affect water supply?: "Oyu Tolgoi was 94 percent complete in July and is slated for commercial production in the first half of 2013. The Mongolian government holds a 34 percent stake in the project, expected to account for about 30 percent of Mongolia's annual economic output.
The mine, in the South Gobi desert region, holds an estimated 41 billion pounds of copper and 21 million ounces of gold, The New York Times reports.
The region covers an area of 135 square miles and is home to 3.8 million livestock, including camels, horses, cows, sheep and goats, which require some 31,600 cubic meters of water each day.
That compares with the water needs of an estimated 10,000 cubic meters per day for residents in the sparsely populated region.
Extracting copper from the mine, however, is a water-intensive process.
A World Bank assessment indicated that in 2010, Oyu Tolgoi used about 67,000 cubic meters of water a day and the government-owned Tavan Tolgoi coal mine consumed 76,000 cubic meters daily."

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Voyager Resources restarts flagship Mongolian copper project - MENAFN

Voyager Resources restarts flagship Mongolian copper project - MENAFN: "The Khul Morit project is located on the Erdene Island Arc Terrain, which is one of the tectonic terrains extending across the Gobi and southern regions of Mongolia.

The region is known to host a number of mineralised copper porphyry systems including the giant Oyu Tolgoi deposit."

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Mongolia enjoys a new mining wealth but at what cost? - thestar.com

Mongolia enjoys a new mining wealth but at what cost? - thestar.com: "Next month, Oyu Tolgoi, the largest mine in the country and one of the three biggest copper-gold mines in the world, will open, pumping billions of dollars a year into the economy. Vancouver-based Turquoise Hill Resources is one of its owners.

Yet, Oyu Tolgoi only tells part of the story of mining in Mongolia."

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Age old Mongolian nomadic heritage under threat due to mining | Ubpost News

Age old Mongolian nomadic heritage under threat due to mining | Ubpost News: "Mongolia is facing many environmental issues such as desertification, inadequate water supply and air and water pollution largely caused by mining and whose burden falls heavily on the herders who are the last keepers of the thousands of years old nomadic culture of the Mongols.
More than 90 percent of Mongolian revenue comes from mining. The Oyu Tolgoi (OT) project is the biggest mining project undertaken in the country and is expected to make up more than third of the gross domestic product (GDP) growth when it is fully operational next year.
“This single mining project is one of the main reasons for the amazing economic growth in the country,” Dale Choi, an analyst at Origo Partners said. “It will be a huge source of employment, and will help improve the living standard for the whole country.”
It will not come without cost to the people and animals living in range of the mine."

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