Claimed to be the world’s largest new copper-gold mines, the Oyu Tolgoi mine is located in Mongolia’s South Gobi region, approximately 550km south of Ulaanbaatar and 80km north of the Mongolia-China border.
Rio Tinto has signed an agreement with Turquoise Hill Resources (TRQ) on an updated financing plan for the $2.3bn underground development of the Oyu Tolgoi copper-gold mine in Mongolia. Under the binding heads of agreement (HoA), Rio and Turquoise Hill agreed to restructure up to $1.4bn of debt payments with lenders. It will also look to raise up to $500m of senior supplemental debt (SSD) for the project from selected international financial institutions under existing financing arrangements.
To address potential shortfalls from the re-profiling and additional SSD, Rio Tinto plans to provide up to $750m through a co-lending facility.
Rio Tinto Copper CEO Bold Baatar said: “This agreement and alignment with TRQ represents a major milestone in the continued development of Oyu Tolgoi, which is expected to become one of the world’s largest copper mines and a significant contributor to the Mongolian economy for years to come.
“Commencing the re-profiling whilst concurrently listening, engaging and resolving the concerns of the Government of Mongolia are critical steps to maintaining momentum on the timely delivery of the Oyu Tolgoi underground project.”
Through Erdenes Oyu Tolgoi, the Mongolian Government has a 34% stake in the Oyu Tolgoi copper-gold mine.