Rio Tinto, Turquoise Hill face more Oyu Tolgoi setbacks

|About: Rio Tinto plc (RIO)|By:, SA News Editor

Rio Tinto's (RIO +0.6%) expansion of the Oyu Tolgoi copper mine could be further delayed because a deadline to secure financing for the project may be missed, according to project owner Turquoise Hill Resources (TRQ -1.2%).

Rio and Mongolia's government are trying to solve disagreements over some development costs, but TRQ, the Rio-controlled company that owns 66% of Oyu Tolgoi, says the issues may not be resolved until a feasibility study for the mine’s growth is completed in H1 of this year.

Rio would thus be placed at risk of missing a March 31 deadline to close project finance agreements with commercial banks and multilateral development banks.

In another setback, TRQ cuts this year's output estimates for the part of the mine already operating to 135K-160K metric tons of copper in concentrates vs. a previous forecast of 150K-175K, and trims its estimate for output of gold, a byproduct at the mine.