Thursday, February 13, 2014

Turquoise Hill says Oyu Tolgoi sales volume below expectations

Feb 13 (Reuters) - Turquoise Hill Resources said year to date sales volume from its Oyu Tolgoi copper and gold mine in Mongolia has fallen short of expectations, citing post-commissioning issues.

The company said it expects production at the Mongolian mine to take a hit due to a shutdown of one line for six to eight weeks.

Turquoise Hill, which owns a majority interest in Oyu Tolgoi and is controlled by Rio Tinto , said it is targeting a production of 150,000 tonnes to 175,000 tonnes of copper and 700,000 to 750,000 ounces of gold in concentrates from Oyu Tolgoi in 2014.

The mine produced 76,700 tonnes of copper and 157,000 ounces of gold in concentrates in 2013.

Turquoise Hill also said it has proposed an option to the Mongolian government to restart the underground development at the facility.

Last July, the company had said that funding and all work on the underground development of Oyu Tolgoi would be delayed.

However, on Wednesday the company said that further delays may occur if outstanding shareholder issues, including project finance, are not resolved before the expiration of lender commitments on existing project finance arrangements.

Global miner Rio Tinto owns 50.8 percent of the Vancouver-based Turquoise Hill, which in turn holds a 66 percent interest in Oyu Tolgoi. Mongolia has a 34 percent stake in the project.

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