Oyu Tolgoi board orders independent review of cost overruns
An independent firm of experts is set to review the cost overruns and delays experienced at the Oyu Tolgoi underground project, in Mongolia, Rio Tinto-controlled Turquoise Hill announced on Tuesday.
The board of Oyu Tolgoi, 66% owned by Turquoise Hill and 34% by State-owned Erdenes Oyu Tolgoi (EOT), has agreed to form a special committee, comprising members nominated by both parties, to review the cost blowout announced last year.
Oyu Tolgoi is set to cost between $1.3-billion and $1.8-billion more than the original $5.3-billion capital estimate.
Each shareholder of Oyu Tolgoi, as well as Rio Tinto, as manager, had to cooperate with the work of the special committee and had to contribute, on a confidential basis, any internal or third-party reports in its possession relating to the cost overruns and delays, Turquoise Hill said.
Oyu Tolgoi’s funding plan has been under scrutiny in recent times, with hedge fund Odey recently raising concern over the project finance package for the mine. Turquoise Hill last month started arbitration against Rio Tinto to seek clarity on financing for the project.
This week, activist investor Pentwater Capital Management, which holds a 9.23% stake in Turquoise Hill, accused Rio Tinto of mismanaging costs and unfairly restricting Turquoise Hill’s ability to obtain finance to pay for these costs.
"Turquoise Hill fully supports our government partner, EOT, in securing an independent and objective review of the cost overruns and delays announced last year,” said CEO Ulf Quellmann.
Comments
The
functionality
you are trying to access is only available to subscribers.
If you are already a subscriber, you can Login Here.
If you are not a subscriber, you can subscribe now, by selecting one of the below options.
For more information or assistance, please contact us at subscriptions@creamermedia.co.za.
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation