Oyu Tolgoi Production on Target

CEO Jeff Tygesen says second quarter production was as planned; however, lower gold production is anticipated in the second half of 2016 as mining occurs in areas with
reduced grades.
Production from open-pit mining at Turquoise Hill Resources’ Oyu Tolgoi copper- gold-silver operation in Mongolia’s South Gobi region is reported to be on target to meet the 2016 production guidance of 175,000 metric tons (mt) to 195,000 mt of copper in concentrates and 255,000–285,000 oz of gold.

The project is operated by Oyu Tolgoi LLC, which is 66% owned by Turquoise Hill with the Mongolian government holding the remainder. Turquoise Hill is majority owned by Rio Tinto.

During the quarter ending in June, concentrator throughput was broadly consistent with the previous quarter, resulting in average daily throughput of approximately 105,000 mt for the quarter. Copper production in the quarter declined 10.3% over the March quarter reflecting lower grades from reduced mining in Phase 2 and lower recovery from Phase 6 ore.

The company said that, as expected, gold production in the second quarter declined approximately 52% over the first quarter due to lower grades from reduced mining in Phase 2. Concentrate sold in quarter two increased 6.7% over quarter one. Open-pit material mined during the quarter was steady at 22.716 million mt; ore treated also remained steady at 9.525 million mt. Average mill head grades were 0.64% copper, 0.33 g/mt gold and 1.92 g/mt silver compared to 0.70%, 0.63 g/ mt and 1.92 g/mt in the previous quarter.

This resulted in production of 517,000 mt of copper, down from 576,000 mt in the first quarter; 70,000 oz of gold, down from 144,000 oz; and 391,000 oz of silver, down from 395,000 oz. During the June quarter, the company sold 544,000 mt of copper in concentrates, 95,000 oz of gold and 395,000 oz of silver, compared to 512,000 mt, 175,000 oz and 305,000 oz in the March quarter.

As featured in Womp 2016 Vol 08 - www.womp-int.com