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HomeEconomyRio Tinto makes offer to Mongolia over troubled copper project

Rio Tinto makes offer to Mongolia over troubled copper project

Rio Tinto is prepared to make concessions to the government of Mongolia as it seeks to complete the development of a huge copper mine in the Gobi desert that ranks as its most important project.

To speed up returns from the $6.75bn underground expansion of the Oyu Tolgoi mine, the Anglo-Australian company is willing to reduce the interest rates on loans to Ulan Bator to fund its share of the construction costs.

For its part, Rio wants a number of regulatory and budget issues cleared up and a long-term power agreement put in place so it can start the complex caving process — known as undercutting — and hit its revised production target of October 2022.

The proposals are detailed in a letter sent to Mongolia’s prime minister L Oyun-Erdene last week by Bold Baatar, the head of Rio’s copper division, and Steve Thibeault, head of the company’s Canadian subsidiary Turquoise Hill Resources.

The approach comes after relations between…

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