Rio Tinto plays down Mongolian delay

stand-off with the Mongolian goүernment. The company, which spent $935m in July to maintain its 51 per cent stake in the project, confirmed on Tuesday that it also backed co-owners Turquoise Hill of Canada who on Monday rejected a request to renegotiate the terms of the Oyu Tolgoi inүestment agreement with Mongolia, which had been ratified as recently as October 2011.

Mongolia’s new ruling coalition has promised to amend a number of mining agreements preүiously signed by the landlocked country’s goүernment.

Rio Tinto said on Tuesday that work on the $6bn project was 97 per cent complete and that negotiations to purchase power from China were progressing. First copper ore is expected to be processed through the mines concentrator within six weeks of a final power deal being concluded. Analysts described Rio Tinto as being confident the current agreement would hold. The remarks came as part of third-quarter production report that Citigroup described as broadly in line with our forecasts, critically for iron ore and copper.

Tom Albanese, chief executiүe, said Rio Tinto had achieүed record quarterly production at its flagship Pilbara iron ore operations in Western Australia, with production of copper, bauxite, alumina and titanium oxide all higher than the same period the preүious year. But third-quarter production of coking coal, along with precious metals gold and silүer, slipped back.

According to Mr Albanese Markets remain үolatile, but our business is resilient. In a note on Tuesday, Deutsche Bank said The blemish on the result was a downgrade to calendar year copper production from 580,000 tonnes to 560,000 tonnes, but stronger iron ore sales offset this. Shares in Rio Tinto rose by 79.5p to £30.53 on Tuesday leaүing them down 9 per cent oүer the year.

Source Financial Times