Rio Tinto to mine gold in Mongolia

Rio Tinto Ltd is to provide finance to Canada-based Ivanhoe Mines for the development of its Oyu Tolgoi copper and gold project in Mongolia.

In exchange for a $US1.8 billion loan, and Rio's participation in Ivanhoe's $1.2 billion rights offering, Rio will assume direct management of the Oyu Tolgoi project.

The deal is expected to help deliver the mine six months ahead of schedule in late 2012.

The agreement will allow Rio Tinto increase its ownership in Ivanhoe to 49 per cent, by acquiring 20 million shares at market prices.

Rio Tinto will be allowed to subscribe to Ivanhoe common shares from treasury at market prices until January 2012.

Ivanhoe owns 66 per cent of the Oyu Tolgoi copper and gold mine project, with the remainder held by the government of Mongolia.

Independently verified estimates indicate Oyu Tolgoi contains approximately 37 million tonnes of copper and 1,300 tonnes of gold in measured, indicated and inferred resources.

It is expected to operate for almost 60 years.

Source:AFP (Agency France Press)-French News Agency