Rio Tinto Antes up $350 Million for Ivanhoe’s Mongolia Mining Deal
From Staff Reports
Global mining giant Rio Tinto PLC. (RTP) Â has agreed to provide a credit facility of up to $350 million to Ivanhoe Mines Ltd. (IVN), its partner in Mongolia’s Oyu Tolgoi copper-gold project.
The credit agreement is part of an interim-funding deal to keep mining project-development work moving, and will also lead to Rio Tinto boosting its maximum possible stake in Ivanhoe to 46.65% – from the previously agreed upon 40%.
Rio Tinto paid about $300 million last year for its initial 9.95% stake in Ivanhoe. It will gain an additional 9.95% when it pays another $388 million when the partners all cement a long-term investment agreement with the government of Mongolia.
"An equitable investment agreement is essential if Mongolia is to attract sustainable international mining investment," Bret Clayton, chief of Rio Tinto’s copper business, said in a statement. "This will encourage further exploration, development, employment and skill training programs."
Ivanhoe said the credit facility would permit site preparations and final design work to continue through the coming months. The huge project is aiming to produce more than a billion pounds of copper and 330,000 ounces of gold a year.
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