Rio Tinto representatives arrived in Mongolia for talks on development of underground mine

ULAN BATOR, Oct. 15 (MonInfo)--Official sources said representatives of the Rio Tinto, Anglo-Australian mining giant has arrived in Ulaanbaatar yesterday to continue the talks with Mongolian government.

Mongolian government is pushing Rio Tinto to resume the development of underground mining shafts in Oyu Tolgoi mine. In August, Rio Tinto announced halt of development of the underground mine of Oyu Tolgoi as Mongolian government was not responding to the project financing proposal of Rio Tinto. 

Earlier, Mongolian government representatives visited London headquarters of Rio Tinto and upon coming back claimed the talks were success.

Otgochuluu Chuluuntseren, Mongolian board member of the Oyu Tolgoi LLC, the joint venture between Rio Tinto and Mongolian government said “ Mongolia is interested to address all issues and continue the work at Oyu Tolgoi”.

During the UB talks, the parties are expected to talk about project cost overruns and updating the mine feasibility study which was source of conflict between the parties and most importantly, the project financing scheme proposed by Rio Tinto.

Mongolian government claims Rio Tinto which manages the copper-gold mining project in South Gobi region of Mongolia exceeded approved initial cost limit by 2 billion dollars.

Facing with deteriorating economic condition and shortage of hard currency,  Mongolian government is attempting to push Rio Tinto to resume underground mine development and continue its investment in the country.

Previously, Rio Tinto tried to get approval of Mongolian government for its project financing proposal to fund development of the underground mine since the last winter. However, Mongolian government never provided direct answer  and delayed it until today.

According to the proposal, Rio was to get 4 billion dollar financing from dozen leading global banks such as International Finance Corporation, private financing arm of World Bank, European Bank for Reconstructiona and Development and  PNB Paribas, Export-Import bank of USA, Export Development Bank of Canada,Standard Chartered Bank etc.

Otgochuluu who is also director of strategic policy and planning of the Mongolian Ministry of Mining said the talks in Ulanbator will continue until Dec of this year. Enditem.