Rio Tinto CEO says Nov plan to restart Oyu Tolgoi was "best and final offer

(Repeats story published on Saturday; no changes to text)
* Rio in talks with Mongolia on "detail" of Oyu Tolgoi restart
* Financing for second phase needs renegotiating
* Timing for completion of second phase still unclear
By Terrence Edwards
ULAN BATOR, March 28 (Reuters) - Proposals made to the Mongolian government by global mining giant Rio Tinto last November to restart the long-delayed Oyu Tolgoi copper mine were the firm's "best and final offer" and won't be changed, Rio's chief executive said.
Rio submitted the proposals to resolve some outstanding issues, including a $127 million tax claim that has already been cut to $30 million as well as the approval of a $4 billion project financing package to pay for phase-two construction.
"This is the best and final offer and we believe this a very reasonable approach to resolving the outstanding issues," said Sam Walsh in an interview with Reuters on Saturday ahead of a visit to the mine.
"Clearly, in terms of reaching a final conclusion there's a lot of detail that needs to be resolved, so negotiations were continuing last week," he said, adding that Rio was "not looking for special treatment" but wanted more certainty and clarity from Mongolia.
Walsh said the firm would be willing to go to international arbitration to resolve the tax dispute, but said it was not expected to affect current phase-one production at the mine.
Rio Tinto's Turquoise Hill Resources owns 66 percent of the $6.5 billion Oyu Tolgoi, with the Mongolian government holding the remainder. Rio is also in charge of running and developing the project, which is located in the Gobi desert close to Mongolia's border withChina.
The first, open-cut phase of the mine is already in operation. Turquoise Hill reported $1.6 billion in revenue for 2014 from the sale of 733,700 tonnes of concentrate from the mine.
Walsh said financing for the second phase of the project, which will extend the mine underground, will have to be renegotiated, especially in light of volatile copper prices.
"There have been a number of lenders who rolled over their offers. Once we've resolved all of the negotiations, we need to go back to lenders to confirm the availability of the funding," he said.
He didn't have a specific timeframe for when the second phase could finally begin operations, saying Rio would first have to finalise negotiations with the government and also remobilise its workforce.
"There are a lot of moving parts there that would need to be taken into account before you can specify when it would start," he said. (Writing by David Stanway; Editing by Kim Coghill)


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