The Oyu Tolgoi Copper-Gold Project in southern Mongolia produced 148,400 tonnes of copper and 589,000 ounces of gold in concentrates in 2014 compared to 76,700 tonnes of copper and 157,000 ounces of gold in concentrates in the previous year, according to the annual report of Turquoise Hill Resources.

The company said that higher ore grades during the fourth quarter led to increased metal production over prior quarters, which was partially offset by reduced processing rates as a result of the December 2014 concentrator fire.

This year Oyu Tolgoi is expected to produce 175,000 to 195,000 tonnes of copper and 600,000 to 700,000 ounces of gold in concentrates with production distribution expected to be relatively similar to 2014.

Turquoise Hill said that Oyu Tolgoi achieved a good safety performance for 2014 with no fatalities and an All Injury Frequency Rate of 0.47 per 200,000 hours worked.

The operation recorded net revenue of approximately $1.6 billion in 2014 on sales of approximately 733,700 tonnes of concentrate. It recorded net revenue of $634.1 million in quarter four on sales of approximately 262,700 tonnes of concentrate - a 19.2% increase over the previous quarter.

During 2014, Turquoise Hill generated its first annual positive operating cash flow of $658.3 million. Cash operating costs at Oyu Tolgoi in 2014 were $905.6 million.

Turquoise Hill says it, majority shareholder Rio Tinto and the Government of Mongolia continue to work together to resolve shareholder matters. The 2014 Oyu Tolgoi Feasibility Study was finalized in September 2014 and in October 2014 Turquoise Hill filed an updated 2014 Oyu Tolgoi Technical Report.

Turquoise Hill's cash and cash equivalents at December 31, 2014 were $862.8 million as the result of positive cash flows from Oyu Tolgoi, and repayment received in full for Turquoise Hill's $115 million Mongolian Treasury Bill, which matured on October 19, 2014.

Oyu Tolgoi is about 550km south of Ulaanbaatar and 80km north of the Mongolia-China border.

The Oyu Tolgoi mine has initially been developed as an open-pit operation. A copper concentrator plant, with related facilities and necessary infrastructure to support an initial daily throughput of 100,000 tonnes of ore, has been constructed to process ore mined from the Southern Oyu open pit. Long term development plans for Oyu Tolgoi are based on a 95,000-tonne-per-day underground block-cave mine. In August 2013, development of the underground mine was delayed to allow matters with the Government of Mongolia to be resolved.

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