Tinto shipped the first copper concentrate from its
$6.2-billion Oyu Tolgoi Mine in South Gobi, Mongolia, July
"Constructing a mine
of this scale is a fantastic achievement, but watching
Mongolian concentrate leaving the gates is the moment we have
all been working towards," Oyu Tolgoi LLC chief executive
officer Cameron McRae said in a statement. "Today is a big
first step in moving from a world-class construction project to
a world-class copper business."
The Oyu Tolgoi copper
mine is vital to reducing Rio Tintos dependence on iron
"Oyu Tolgoi starts
production at a time when undeveloped quality copper assets are
scarce and the outlook for copper continues to be strong. With
continued development, Oyu Tolgoi will generate wealth for many
decades to come," Rio Tinto copper chief executive officer
Jean-Sebastien Jacques said in a separate statement.
The initial sale will
amount to about 5,800 tonnes of copper concentrate, Oyu Tolgoi
"Today, the first
convoy of 16 trucks, carrying 576 tonnes of Oyu Tolgoi ...
copper concentrate departed," Oyu Tolgoi said, adding that the
remainder of the shipment will be transported to customers
after Mongolias Naadam holiday from July 11-13.
Oyu Tolgoi executives
have said that the first shipments would be to smelters in
China, with no immediate plans to ship to Indonesian smelters
hurt by the closure of the Grasberg Mine.
government holds a 34-percent stake in Oyu Tolgoi, and
Turquoise Hill, a unit of Rio Tinto, holds the rest.
The future $4 billion
in project funding for the mine expansion hinged on the first
shipment, an important milestone for Rio Tinto.
The project currently
has an open-pit mine, but the underground mine is expected to
be operational in 2018-19.
average annual output over 20 years from open-pit and
underground mining is expected to be 430,000 tonnes of copper
and 425,000 ounces of gold, Rio Tinto said.
Rio Tinto paid $1.1
billion in taxes and payments to the Mongolian government
through June. The project is expected to account for 35 percent
of Mongolias gross domestic product by 2020, when it is
Oyu Tolgoi currently
has stockpiles of about 50,000 tonnes of copper
A version of this
article was first published in AMM sister publication Metal