Turquoise Hill Resources says that on December 12 the Board of Oyu Tolgoi LLC, the joint venture controlling company for the Oyu Tolgoi Copper-Gold-Silver Project, unanimously approved the 2014 operating budget. Turquoise Hill, which owns 66% of the project, says this is an important step in preparation for the mine's first full year of operations. The Government of Mongolia holds the other 34%.
In 2014 production from Oyu Tolgoi is expected to be 150,000 to 175,000 tonnes of copper in concentrates and 700,000 to 750,000 ounces of gold in concentrates. Operating cash costs are expected to be approximately US$1 billion and capital expenditure is expected to be US$160 million of which about US$80 million relates to sustaining capital. During 2014, Oyu Tolgoi intends to draw down inventory and return to more normal levels of approximately four to six weeks of production.
Turquoise Hill announced that on April 17, 2013, Rio Tinto signed commitment letters with 15 commercial banks that locked in pricing and terms for the Oyu Tolgoi project financing. Rio Tinto has received extensions to the commitment letters from the 15 commercial banks that now expire on March 31, 2014. Turquoise Hill and Rio Tinto remain focused on securing project finance to fund the Oyu Tolgoi project with the full support of the Government of Mongolia. Rio Tinto holds a majority stake in Turquoise Hill.
Turquoise Hill says all parties are committed to resolving the shareholder issues and advancing the necessary steps to restart the underground mine; including resolution of the shareholder issues, completion of the feasibility study, project financing, permitting and approvals. The feasibility study remains on track for completion in the first half of 2014.
Turquoise Hill Resources is an international mining company focused on copper, gold and coal mines in the Asia Pacific region. The company’s primary operation is its 66% interest in the Oyu Tolgoi mine in southern Mongolia. It also holds a 56% interest in Mongolian coal miner SouthGobi Resources.