Press Release of Rio Tinto
Following a series of agreements between Rio Tinto, Ivanhoe Mines and the Government of Mongolia, Rio Tinto will assume direct management of the Oyu Tolgoi project from December 2010, subject to approval by the Board of Oyu Tolgoi LLC.
Rio Tinto has the right to increase its stake in Ivanhoe Mines to 49 per cent.
Rio Tinto and Ivanhoe Mines have agreed in principle to reduce the interest rate on the Government of Mongolia’s 34 per cent share of the costs of Oyu Tolgoi to LIBOR plus 6.5 per cent. An agreement will be signed in near future.
Consistent with existing agreements, the Government of Mongolia’s 34 per cent stake will not be diluted. No preferred shares will be issued and the Government of Mongolia remains free to source financing independently at any time.
Rio Tinto has also agreed to a financing package for Oyu Tolgoi LLC, including a US$1.8 billion interim loan facility while working together with Ivanhoe Mines to complete project financing. This will allow Oyu Tolgoi to accelerate the project timeline that will see first copper production occur approximately six months ahead of schedule in late 2012.
Rio Tinto Copper chief executive Andrew Harding said: “Today’s agreement reinforces Rio Tinto’s commitment to the world-class Oyu Tolgoi mine development. We look forward to contributing our operating and technical expertise to this project. Together with the Government of Mongolia and with Ivanhoe Mines, we will develop Oyu Tolgoi in a sustainable, mutually beneficial, manner for our shareholders and the people of Mongolia.”
Additional information can be obtained from www.riotinto.com/media
About Oyu Tolgoi LLC (www.ot.mn)
Oyu Tolgoi LLC, Mongolia's largest copper and gold mining company, is a strategic partnership between the Government of Mongolia, Turquoise Hill Resources and Rio Tinto. Located in the South Gobi, Oyu Tolgoi commenced shipment of product to customers in July 2013. Oyu Tolgoi is managed by Rio Tinto, which is investing global expertise and cutting-edge technology to help develop Mongolia’s mining industry and ensure Oyu Tolgoi is one of the world’s most advanced mines. For Oyu Tolgoi, nothing matters more than safety. The business operates under the principle that if a job cannot be done safely, it will not be done at all.