Rio Tinto in talks to prevent another attack on Oyu Tolgoi
The world’s second-largest mining company said changes in Mongolian labor law, which will come into force in early 2022, had forced it to recalculate its employees’ salaries.
Rio Tinto began underground mining at Oyu Tolgoi in March 2023. The company is now ramping up production to achieve annual production averaging around 500,000 tonnes of copper per year from 2028 to 2036.
According to Rio Tinto, Oyu Tolgoi is expected to be the fourth largest copper mine in the world by 2030 and operate in the first quartile of the copper equivalent cost curve.
The company has been mining ore from the huge Oyu Tolgoi open-cast mine since 2011.
The cost of building new copper mines has increased significantly over the years. In 2000, the average capital required to produce one ton of copper in a new copper mine was between $4,000 and $5,000. By 2012, it had risen to $10,000 per ton, and current analyses estimate costs of up to $44,000 per ton of production.
For this reason, Rio Tinto has repeatedly stated that the company will prioritize developing and expanding copper mines over acquiring new ones in order to achieve its goal of producing one million tonnes of the metal annually within the next five years.
The talks between Rio Tinto and Oyu Tolgoi are reportedly taking place at a time when wage negotiations are still ongoing at Escondida, Chile, the world’s largest copper mine.
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