Turquoise Hill board approves bridging budget for Oyu Tolgoi
The board of Turquoise Hill has approved a bridging budget of $75-million to continue to progress critical activities at the Oyu Tolgoi underground mine development project, in Mongolia.
The approved increase should be sufficient to sustain work on the underground mine development up to mid-January, the Rio Tinto-controlled company said on Monday.
The short-term budget approval came as the company reported that progress had been made in the ongoing negotiations between the government of Mongolia, Rio Tinto and Turquoise Hill over the Oyu Tolgoi project.
Rio Tinto CEO Jakob Stausholm recently made a trip to Mongolia to meet the Prime Minister to revive a relationship that soured over the development of the underground mine.
Rio has faced costly delays at the underground expansion of its Oyu Tolgoi project that it has blamed on geotechnical difficulties and Covid-19, angering the Mongolian government and shareholders of Turquoise Hill. Rio last month delayed first production at the underground development of Oyu Tolgoi by three months to January 2023, after Turquoise had estimated additional funding required for the project had ballooned to $3.6-billion.
Turquoise Hill said that the decision to approve the bridging budget was “a necessary and positive step” in the near term and cautioned that there could be no assurance that the board would approve any future investment to progress the underground development.
Oyu Tolgoi remained at risk of having to slow down further work on the underground development.
- with reporting by Reuters
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