Categories: BusinessEconomy

Oyu Tolgoi review raises doubts over Rio Tinto stance on cost overruns

Aug 9 (Reuters) – Turquoise Hill Resources (TRQ.TO) said an independent review of$1.4 billion in cost overruns at the Oyu Tolgoi mine in Mongolia suggested that the project’s troubles were not caused by the geology issues that mine operator Rio Tinto blamed in 2019.

The review “raises certain questions in relation to the project management process” around the cost blowout and delay, Turquoise Hill said.

“Rio Tinto will engage with the OT (Oyu Tolgoi) Board as soon as we have had the opportunity to review the report in detail,” Australia’s Rio Tinto (RIO.AX)(RIO.L) said in an emailed statement.

Rio owns 51% of Turquoise Hill, which owns 66% of the Oyu Tolgoi mine. The rest of the mine is owned by the government of Mongolia.

Costs to expand the Oyu Tolgoi mine, Rio’s biggest copper growth project, have ballooned up to $6.75 billion from its original budget of $5.3 billion in 2016, raising friction over funding with Turquoise Hill.

The Wall Street Journal was first to report the news.Reporting by Priyanshi Mandhan in Bengaluru; Editing by Devika Syamnath and Subhranshu Sahu

Our Standards: The Thomson Reuters Trust Principles.

Source: https://www.reuters.com/business/rio-tinto-mismanagement-caused-cost-overrun-mongolian-mine-wsj-2021-08-09/

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