Friedland takes issue with Rio Tinto
Tensions between the owners of the massive Oyu Tolgoi project in Mongolia, diversified miner Rio Tinto and Canada’s Ivanhoe Mines, appeared to flare up again on Wednesday, after the smaller firm accused its partner of making unauthorised statements regarding the asset.Ivanhoe CEO Robert Friedland said his firm had become aware of “dissemination of what it considers to be unauthorized and incomplete information concerning the Oyu Tolgoi project by members of Rio Tinto’s senior management during a briefing for investors this week”.
The company did not specify what information it was referring to, only saying it “will provide further details in a future statement following communication directly with Rio Tinto on the specifics of its concerns”.
Earlier this week, Mongolian press quoted finance minister S. Bayartsogt as saying the government wanted to alter the 2009 agreement with Ivanhoe for the development of Oyu Tolgoi.
According to Reuters, Rio Tinto copper head Andrew Harding told an investor briefing in London on Tuesday that the project had already generated large amounts of wealth for the country.
“I’ve had discussions with many (Mongolian) ministers and they fundamentally understand that it is not only about the value that is being gained now,” Harding said.
Earlier this month, Rio Tinto made a presentation in Mongolia, which showed how much Oyu Tolgoi will contribute to the country.
The project will account for around one-third of Mongolia’s economy by 2020, and will have led to an increase of a similar magnitude in the size of the Asian country’s economy by the same time, CEO of the mine Cameron McRae said.
This is not the first time Friedland has bumped heads with Rio Tinto.
Ivanhoe this year implemented a shareholder rights plan that would prevent the bigger firm from increasing its stake even after the agreement expires next year, unless it makes an offer to all shareholders.
Rio Tinto disputed the shareholder rights plan and the two parties headed to arbitration over the issue, and no settlement has yet been announced.
Oyu Tolgoi is expected to produce more than 1.2-billion pounds of copper and 650 000 oz of gold a year in the first ten years of operation, and the mine would produce around 1.7-billion pounds of copper and one-million ounces of gold at its peak, in year seven.
The first openpit phase is set to start commercial production in 2013, with underground production set to arrive two years later.
Australia- and London-listed Rio Tinto owns 48.5% of Ivanhoe, which in turn owns two-thirds of Oyu Tolgoi. The Mongolian government owns the remainder.
The company did not specify what information it was referring to, only saying it “will provide further details in a future statement following communication directly with Rio Tinto on the specifics of its concerns”.
Earlier this week, Mongolian press quoted finance minister S. Bayartsogt as saying the government wanted to alter the 2009 agreement with Ivanhoe for the development of Oyu Tolgoi.
According to Reuters, Rio Tinto copper head Andrew Harding told an investor briefing in London on Tuesday that the project had already generated large amounts of wealth for the country.
“I’ve had discussions with many (Mongolian) ministers and they fundamentally understand that it is not only about the value that is being gained now,” Harding said.
Earlier this month, Rio Tinto made a presentation in Mongolia, which showed how much Oyu Tolgoi will contribute to the country.
The project will account for around one-third of Mongolia’s economy by 2020, and will have led to an increase of a similar magnitude in the size of the Asian country’s economy by the same time, CEO of the mine Cameron McRae said.
This is not the first time Friedland has bumped heads with Rio Tinto.
Ivanhoe this year implemented a shareholder rights plan that would prevent the bigger firm from increasing its stake even after the agreement expires next year, unless it makes an offer to all shareholders.
Rio Tinto disputed the shareholder rights plan and the two parties headed to arbitration over the issue, and no settlement has yet been announced.
Oyu Tolgoi is expected to produce more than 1.2-billion pounds of copper and 650 000 oz of gold a year in the first ten years of operation, and the mine would produce around 1.7-billion pounds of copper and one-million ounces of gold at its peak, in year seven.
The first openpit phase is set to start commercial production in 2013, with underground production set to arrive two years later.
Australia- and London-listed Rio Tinto owns 48.5% of Ivanhoe, which in turn owns two-thirds of Oyu Tolgoi. The Mongolian government owns the remainder.
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