According to Mining.com, the Mongolian government is eager to replace a previous agreement with Rio Tinto to invest $6.75 billion to expand production at the Oyu Tolgoi copper and gold mine in South Gobi province.
Instead of taking unilateral action that could affect the foreign investment project, the Mongolian government recommended that Rio Tinto and the company jointly terminate the project.
The Financial Times reports that the ultimate goal is to reach a new agreement in favor of Mongolia.
In early January, the Mongolian government threatened to halt construction of the mine, arguing that project delays and higher costs had eroded the country's hoped-for economic benefits.
In 2019 Rio Tinto raised stability risks associated with the original project design, which would have resulted in an additional cost of $1.9 billion and a 30-month delay.
Rio Tinto confirmed its long-awaited cost estimate for the underground mine expansion in December and said the project would start production in October 2022.
Erdenes Oyu Tolgoi LLC, the Mongolian state-owned company that owns a third of Oyu Tolgoi, reacted to the new schedule and budget by saying Rio had not lived up to its 2015 commitments.
Erdeni's interest in Oyu Tolgoi is primarily realized through its 34% stake in Oyu Tolgoi LLC, a subsidiary of Oyu Tolgoi.
The rest is owned by Turquoise Hill Resources of Canada, which is 50.79 percent owned by Rio Tinto.
The expansion will make Oyu Tolgoi the fourth-largest copper mine in the world, and it is unclear how the mine will be developed to maximize the benefits of all concerned.
A Mongolian parliamentary working group set up in 2019 recommended exploring product-sharing agreements and/or replacing equity with special royalties.
Rio Tinto and Turquoise Mountain are keen to bring the underground mine expansion project into production soon, but face financing difficulties.
Last week, the company won a temporary but crucial victory when an arbitration court granted it temporary relief.
The ruling requires Rio not to restrict negotiations between Turquoise Mountain and Oyu Tolgoi's other shareholders on capital raising and other matters.
The company has other issues to resolve, including the extension of its existing power agreement, which expires in March.
Oyu Tolgoi imports electricity from neighbouring China.
As a result, the management of Oyu Tolgoi is likely to undergo a restructuring and will need to approve resource reserves announced in 2019 and a feasibility study to be completed in 2020.
All these issues must be resolved before Rio's decision in May.
The process will be partially mined using what is known as block caving.
This involves digging holes in the underside of the ore body, and then collapsing the ore piece by piece under its own weight.
Rio will be influenced by the thinking of its new chief executive, Jakob Stausholm, who just two weeks ago reshuffled the top ranks and created two new positions.
Rio Tinto has repeatedly highlighted Oyu Tolgoi as its most important development project.
Once operational, Oyu Tolgoi will produce 480,000 tonnes of copper per year between 2028 and 36 years.
PUDA History：
PUDA is a 28-year’s leading, growth-focused manufacturer of packing equipment and custom-engineered and integrated plant-wide system for dry bulk powders, flakes, and granules. Puda owns world famous partners like Southern Copper Corp. Rio Tinto Group, Zijin Group, LG China, OT Group, FL Smith, MCC,KAZ Minerals PLC and E.Mix and ECUACORRIENTE S.A.
Puda is totally committed to achieve customer satisfaction around the world by providing quality service to top clients from conception to installation, through to commissioning and after sales support.
Puda bagging machines range from individual equipment to automated systems that are suitable to mineral, metallurgy, agriculture, chemicals and food.
Bagging Machines
Heater sealer
Check-weigher and-rejecter
Hooking scale, platform scale
Mixers/Blenders
Dry mortar plant
Screeners
Bulk bag discharger
