Global mining group Rio Tinto unveiled a pathway for the development of underground production at Oyu Tolgoi copper-gold mine in Mongolia.
Rio Tinto said production from the mine is expected to begin in October 2022, adding that it will come with development capital of $6.75bn.
The Oyu Tolgoi gold and copper mine is situated in the south Gobi region of Mongolia.
It is around 80km north of the Chinese-Mongolian border and 550km south of Ulaanbaatar.
Oyu Tolgoi is jointly owned by the Government of Mongolia (34%) and Turquoise Hill Resources (66%). Rio Tinto owns 51% of Turquoise Hill.
To ensure the commencement of the caving operations in 2021, Rio Tinto and its partners need to work on finalising three other milestones.
These milestones include securing government approvals, funding as well as a power solution for the mine.
In a press statement, Rio Tinto said: “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 mine is expected to produce over 480,000t of copper per annum from the open pit and underground on average from 2028 to 2036, compared to 146,300t last year.
Rio Tinto Copper & Diamonds chief executive Arnaud Soirat 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.”
The underground Ore Reserve has an average copper grade of 1.52%, which is three times more than the open pit Ore Reserve.
In September, Rio Tinto and Turquoise Hill signed a MoU to progress the financing for completion of the Oyu Tolgoi underground mine.