Seeking Alpha

Mongolia confident of resolving Oyu Tolgoi disputes by year-end

  • A top official in Mongolia's mining ministry is confident the government can resolve disputes with Rio Tinto (RIO -0.4%) over the $5B expansion of the Oyu Tolgoi copper and gold mine by Dec. 31, the deadline for sealing financing for the project.
  • While key issues remain to be resolved, progress was made in last weekend's talks, and the government would be willing to tackle some of its minor concerns after work resumes on the underground mine, the official says.
  • The expansion is vital to Mongolia as it is expected to boost the economy by a third by 2020 and is key to Rio's effort to ease its dependence on iron ore; Rio's Turquoise Hill (TRQ -0.9%) unit owns a 66% stake in the mine.
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Comments (4)
  • marpy
    , contributor
    Comments (1109) | Send Message
     
    Talk is cheap and investors and Rio Tinto have been fooled by the GOM many times in the past. What will be needed here is some real action on the part of the GOM to show that they can be trusted to honor the pieces of paper that they sign and the agreements they make.
    1 Oct 2013, 02:30 PM Reply Like
  • healthpicker
    , contributor
    Comments (1048) | Send Message
     
    I really don't understand how any big miner like RIO can have a contract with GOM that allows this sort of behaviour. If GOM was able to do the mining all by themselves they would not need RIO.
    Maybe we should bring back Gengis Khan to sort GOM out?
    1 Oct 2013, 08:17 PM Reply Like
  • marpy
    , contributor
    Comments (1109) | Send Message
     
    Unfortunately, dealing with the GOM can be like dealing with Bozo the clown. Fortunately Rio Tinto has a lot of experience at dealing with governments in developing countries and will IMO get this sorted out.
    2 Oct 2013, 08:52 AM Reply Like
  • MSE.Investor
    , contributor
    Comments (93) | Send Message
     
    Rule #1 of investing in Mongolia says: Don't hold your breath on what GOM is saying, with may be one exception: winter time in UB because of the pollution :)
    14 Oct 2013, 03:12 AM Reply Like
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