TORONTO (miningweekly.com) – Vancouver-based miner Turquoise Hill Resources on Monday said its owner Rio Tinto had secured extensions to the financing commitment letters from 15 commercial banks that would now expire on March 31, 2014.

On April 17, Rio Tinto signed commitment letters that locked in pricing and terms for the Oyu Tolgoi copper/gold project’s underground expansion financing.

Turquoise Hill said that Rio Tinto, which owns 50.8% of the significant Mongolian mine, remained focused on securing project finance to fund the Oyu Tolgoi project with the full support of the Mongolian government.

“All parties are committed to resolving the shareholder issues and advancing the necessary steps to restart the underground mine,” Turquoise Hill said in a statement.

This included resolving shareholder issues, completion of the feasibility study, project financing, permitting and approvals. The feasibility study was expected to be complete during the first half of 2014.

Rio Tinto was trying to resolve disputes with the Mongolian government over terms for $4.2-billion in project financing to fund an expansion at Oyu Tolgoi, which would be critical to Rio's and Mongolia's growth.

Rio put the $5-billion expansion project on hold in August and said it would have to cut up to 1 700 jobs owing to the project financing dispute.

Turquoise Hill said it expected Oyu Tolgoi to produce between 150 000 t and 175 000 t of copper in concentrates and 700 000 oz to 750 000 z of gold in concentrates. Operating cash costs were expected to be about $1-billion and capital expenditure was expected to be $160-million, of which about $80-million related to sustaining capital.

LEGAL CHALLENGE

Turquoise Hill also announced that on Friday, a purported class action complaint was filed in the United States District Court for the Southern District of New York alleging violations of the federal securities laws by Turquoise Hill and certain of its officers and/or directors arising out of the company's restatement resulting from the revisions to the revenue recognition protocol by coal-mining subsidiary SouthGobi Resources.

The company believed the complaint was without merit and vowed to vigorously defend against it.

Meanwhile, at the end on November, Turquoise Hill closed the divestment of its 50% stake in Altynalmas Gold to Sumeru Gold for $235-million.