Rio Tinto and Mongolia Government to strike deal over Oyu Tolgoi mine
Rio Tinto's plan to develop a $6.6bn underground expansion of Oyu Tolgoi copper-gold mine in Mongolia, is set to advance.
Rio Tinto and the Mongolian Government will finalise a deal over the long-awaited development of the mine's second stage before the end of March, reports The Sydney Morning Herald.
The latest news comes after one of the company's contractors began advertising for workers at the major underground, copper and gold mine.
Expansion of Oyu Tolgoi mine has been on hold since the company failed to reach an investment agreement with the government.
The mining project has being touted as a major revenue generator for the country.
Rio Tinto's Turquoise Hill Resources owns a 66% stake in the Oyu Tolgoi gold-copper mine, which is situated in the south Gobi region of Mongolia, around 80km north of the Chinese-Mongolian border and 550km due south of the capital, Ulaanbaatar.
The remaining stake in the mine is owned by the Mongolian Government.
The Oyu Tolgoi mine is expected to produce an average of 430,000t of copper and 425,000oz of gold annually for 20 years. This year's targets are 150,000t to 175,000t of copper in concentrates and 700,000oz to 750,000oz of gold in concentrates production.
After completion of the second phase of expansion, experts believe that the mine could produce more than 1.2 billion pounds of copper, 650,000oz of gold and three million ounces of silver annually.
Image: Oyu Tolgoi mine has been touted as a major revenue generator for Mongolia. Photo: courtesy of Rio Tinto Company.