Rio Tinto Group approves US$5.3-billion Oyu Tolgoi copper mine expansion

, Crisis

It was reported on the weekend that Rio Tinto Group is considering taking Turquoise Hill Resources Private. Turquoise Hill, which is controlled by Rio Tinto,  owns the Oyu Tolgoi copper-gold mine jointly with the government of Mongolia.

Rio Tinto Group and its partners approved a US$5.3-billion expansion to more than double output at the Oyu Tolgoi copper and gold mine in Mongolia as producers race to meet a forecast global deficit by the end of the decade.

Work on the project will begin from the middle of this year and first production from the underground mine is expected in 2020, London-based Rio, the world’s-second biggest mining company, said Friday in a statement. When the underground is fully ramped up in 2027, Oyu Tolgoi is expected to produce more than 500,000 metric tons of copper a year.

Shares of Turquoise Hill Resources Ltd., which owns 66 per cent of the deposit, jumped 8.7 per cent to $3.74 at 11:46 a.m. in Toronto, after earlier climbing as much as 13 per cent, the biggest intraday increase since February. Rio Tinto controls Turquoise Hill through a 51 per cent equity stake, according to data compiled by Bloomberg.

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