Turquoise Hill Resources has produced its first copper-gold concentrate at the Oyu Tolgoi complex in southern Mongolia, just weeks after processing the first ore through the concentrator in early January. The company says with the achievement of the first concentrate, commencement of commercial production is expected within the next three to five months.
Turquoise Hill’s chief executive officer Kay Priestly says, “Oyu Tolgoi continues to progressively ramp-up the mine and the production of first concentrate is another important milestone. We are making good progress on our timetable leading to the start of commercial operations.”
She says the ramp-up schedule is on track, despite media reports of political issues forcing a temporary halt to construction work at the $6.2 billion project. Turquoise Hill’s parent company Rio Tinto says it is not halting work at the site in protest of the Mongolian government’s demands for a bigger stake in the project and new mining royalty rates.
“The power is secured, first ore produced and the concentrator switched on,” says Rio Tinto spokesman Illtud Harri. “We are on schedule for first commercial production in the first half of the year.”
However, market analysts are still touting a possible delay of the phase 2 underground development until the political situation is resolved. Rio Tinto and Turquoise Hill signed an investment agreement with Mongolia in 2009 that covered the construction and operation of the copper-gold mining complex, which will be one of the biggest copper producers in the world. In October last year, the two companies rejected a request from the government to renegotiate the deal.