Ivanhoe Mines and Rio Tinto Sign Omnibus Agreement to Ensure Funding Through to Commercial Production and Additional Expansion at Oyu Tolgoi Copper-Gold-Silver Project
Ivanhoe Mines’ founder Robert Friedland announced today that the company has signed a binding memorandum of agreement with majority shareholder Rio Tinto that establishes Rio Tinto’s support for a series of funding measures expected to cover all projected capital requirements for Ivanhoe’s flagship Oyu Tolgoi Project in southern Mongolia for the next four to five years.
“This agreement sets the stage for the Oyu Tolgoi Project’s transition to a major mining operation in coming months,” Mr. Friedland said.
“The measure of certainty that Rio Tinto’s financial resources and global industry leadership bring to the realization of our long-cherished Oyu Tolgoi dream is reassuring for the people and government of Mongolia, and for Ivanhoe’s shareholders.
“We were attracted to Mongolia’s new horizons for resources opportunities 17 years ago. It now is a fact of Mongolia’s modern history that the men and women of Oyu Tolgoi LLC and Ivanhoe Mines discovered some of the world’s largest deposits of copper, gold, silver and molybdenum in the South Gobi Region. And today, with Rio Tinto’s expanded support, we are counting down to the start-up later this year of what I am sure will quickly grow to become one of the world’s most significant, and successful, mining complexes,” Mr. Friedland added.
“For generations to come, this remarkable, unfolding story will continue to contribute so much to Mongolia’s economic growth, enhance its reputation as a destination for international investment and infuse with well-placed confidence the personal aspirations and national pride of so many Mongolians.”
In accordance with terms of the agreement between Ivanhoe Mines and Rio Tinto, Mr. Friedland resigned yesterday as a member of the Ivanhoe Mines Board of Directors and as Chief Executive Officer. Six other directors and four other senior management members also resigned yesterday.
Comprehensive financial plan to launch Oyu Tolgoi as world-scale copper-gold miner
Mr. Friedland said that the agreement, negotiated by a committee of Ivanhoe Mines’ independent directors, contains a comprehensive financing plan structured to secure Rio Tinto’s direct participation in, and support for, funding for planned developments at Oyu Tolgoi.
“All members of the Ivanhoe Mines Board of Directors have been acutely aware of their paramount duties to ensure that the interests of all shareholders are adequately protected. This now has been accomplished with the comprehensive plan and we can be confident that funding will be available to keep Oyu Tolgoi on schedule and carry it through, and well beyond, the start of commercial production.”