Mongolia’s world-class copper and gold mine Oyu Tolgoi last week commenced commercial shipments of its copper concentrate. This marks a significant milestone for the business and Mongolia with the project moving from the construction stage to the operation of a safe and sustainable working copper mine.
After reviewing the marketing agreements, the Board of Directors of Oyu Tolgoi unanimously endorsed the commencement of shipping. All permits and authorities for exporting copper concentrate are in place together with Board approvals and authorities required for continued concentrate sales. Oyu Tolgoi remains committed to maintaining transparency in its operations and managing export revenues consistent with the investment agreement.
The total size of the initial sale was about 5800 tonnes of copper concentrate. On July 9 the first convoy of 16 trucks carrying 576 tonnes of ‘Oyu Tolgoi - Product of Mongolia’ copper concentrate departed towards the Gashuun-Sukhait border crossing. Following the Naadam holiday, the remainder of the shipment will be transported to customers.
Oyu Tolgoi CEO and president Cameron McRae says, “Everybody involved in Oyu Tolgoi is immensely proud. Constructing a mine of this scale is a fantastic achievement but watching Mongolian concentrate leaving the gates is the moment we have all been working towards. Today is a big first step in moving from a world-class construction project to a world-class copper business. My thanks go to everyone who has played a role in bringing us to this point.”
Currently, copper concentrate is processed from Oyu Tolgoi’s open pit ore. The richest part of the deposit will be accessed by an associated underground mine. Even though full funding to proceed with the underground has not been approved, early development has begun. Even at its current production, however, the operation of the mine will provide significant income to the Mongolian Government through royalty payments and tax revenue.
Oyu Tolgoi has already had a positive impact on Mongolia. It was recently named by the Mongolian Government as creating the most jobs and paying the second highest taxes of all companies last year, even before sales commenced. Oyu Tolgoi has also developed significant infrastructure in the South Gobi, much of which will benefit local people as well as allowing the mine to operate. To prepare a strong future workforce, Oyu Tolgoi is investing US$126 million in education and training over five years.
Oyu Tolgoi LLC, Mongolia’s largest copper and gold mining company located in the South Gobi, is a strategic partnership between the Government of Mongolia, Turquoise Hill Resources and Rio Tinto. Oyu Tolgoi is managed by Rio Tinto, which is investing in the best global expertise and technology to help develop Mongolia’s mining industry and ensure Oyu Tolgoi is one of the world’s most advanced mines.
Entrée Gold, Oyu Tolgoi’s joint venture partner in deposits adjacent to the OT open pit, has offered congratulations on the first shipment. President and CEO Greg Crowe says, “A significant milestone such as this can only be reached through the hard work, dedication and perseverance of all parties involved. Projects of the magnitude and quality of Oyu Tolgoi are extremely rare and the successful development of this world class asset can bring substantial benefits to the Mongolian people for decades to come.
MONGOLIA