Ivanhoe Budgets $2.3 Billion for Oyu Tolgoi in 2011
Principal elements of the 2011 con-
struction program include:
• $561 million for the copper-gold con- centrator, which will see complete en- closure of the building, completion of steel work for the overland ore con- veyor, installation of one of four ball mills, and installation of all material- handling equipment in the pebble crusher.
• $186 million to purchase the initial mining fleet of trucks, shovels and ancillary equipment, and to start pre- stripping of the Southern Oyu open- pit mine. The Oyu Tolgoi technical committee has decided to increase the capacity of the mining fleet’s trucks, opting for 290-mt units that will help to move an estimated 112 million mt/y of ore and waste. Pre- stripping of the open-pit mine will begin in 2011 to ensure that planned production levels can be achieved.
• $713 million for project infrastruc- ture and electrical power, including completion of the central substation, completion of the process-water sup- ply, completion of the truck mainten- ance shop, and phases one and two of the operations camp.
• $211 million for ongoing under- ground mine development at the Hugo North Deposit, construction of the headframe on Shaft No. 2, and further sinking of Shaft No. 2, which are critical elements of the develop- ment of the block-cave mine planned to begin production in 2015.
Total capital required for Oyu Tolgoi phase one from January 1, 2011, to the start of commissioning of the ore pro- cessing plant, which is planned for the second half of 2012, is projected to be $3.5 billion. This includes approxi- mately $2.9 billion to complete con- struction of the Southern Oyu open-pit mine, processing plant and essential infrastructure, including electricity, water, roads, a paved airport runway and a Mongolian-designed passenger terminal. It also includes taxes and continued underground development of the phase-two Hugo North mine.
Commissioning will be followed later in 2012 by initial phase-one production and then by commercial production, expected during the first half of 2013.