Tag Archives: Oyu Tolgoi

Oyu Tolgoi loses some of its underground reserves following updated feasibility study

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An updated feasibility study on the development of the underground mine at Oyu Tolgoi, in Mongolia, has confirmed that the huge copper-gold project will be delivering sustainable production later than initially planned and this output will come with a higher capital expenditure bill.

Majority owned by Rio Tinto through its 66% stake in Turquoise Hill Resources, Oyu Tolgoi is currently being mined as an open-pit operation (producing 146,346 t of copper and 241,840 oz of gold in 2019), yet previous studies have indicated a combined open-pit and underground operation could up the tally to around 500,000 t/y of copper.

Back in July 2019, Rio Tinto included an update on the underground project saying first output was expected to be achieved between May 2022 and June 2023, a delay of 16 to 30 months compared with the original feasibility study guidance in 2016, while preliminary estimates for development capital spend was $6.5-$7.2 billion, $1.2-$1.9 billion up on the $5.3 billion previously disclosed.

The updated feasibility study issued this week from Oyu Tolgoi LLC (owned 66% by Turquoise Hill and 34% by the Mongolian government), which is in the process of being submitting to the Government of Mongolia in accordance with Mongolian regulations and standards that require mining companies to submit updated feasibility studies every five years, includes a delay of 21 to 29 months for first sustainable production compared to the original feasibility study guidance in 2016 and an increase of $1.3-$1.8 billion from the original $5.3 billion development capital.

This process has also seen 1.22 Mt of copper, 850,000 oz of gold and 7.01 Moz of silver removed from the Hugo Dummett North reserve base compared with the December 31, 2019 calculation, with some 80,000 t of copper, 70,000 oz of gold and 550,000 oz of silver added to the Hugo Dummett North Extension reserve base.

It also includes a new mine design for Panel 0 of the Hugo Dummett North underground mine at Oyu Tolgoi, as well as confirming that the caving method of mining remains valid.

Detailed study, design, engineering and optimisation work is ongoing to support the definitive estimate of Panel 0 for the development of this orebody, which remains due in the second half of 2020, Rio said.

These estimates are subject to any additional scheduling delays or increases in capital costs arising from the impacts of the ongoing COVID-19 pandemic, it added.

Back in July 2019, Rio said enhanced geotechnical and geological information obtained from drilling and mapping at depth suggested there may be some stability risks associated with the original mine design. This updated design was the result of a review of this information.

The updated design retains two in-situ rock pillars on either side of Panel 0 for geotechnical stability, whereas the original mine design had these pillars within the mining area. “The updated design is supported by extensive geotechnical modelling and industry leading technical assurance,” Rio said.

As a consequence of leaving the pillars in place, the material contained in the pillars has been reclassified from reserves to resources, Rio said, adding that part of the material contained in these pillars could be recoverable at a later stage following additional studies currently underway. This saw 2.43 Mt of copper, 570,000 oz of gold and 4.81 Moz of silver added to the July 3, 2020, Hugo Dummett North resource base.

Ore handling infrastructure will be relocated to the pillars, located immediately north and south of the current Panel 0 boundaries, Rio explained, with Panels 1 and 2 now be initiated as independent panels or mine blocks.

Optimisation of mine designs for Panels 1 and 2 is ongoing and it is anticipated that this next phase of study may result in further movements in classifications of reserves and resources, according to Rio.

Arnaud Soirat, Chief Executive of Copper & Diamonds, said: “This amended mine design is another positive step in the development of the underground mine which will unlock the most valuable part of Oyu Tolgoi. We remain focused on delivering the underground project safely and within the guidance ranges we have announced on both cost and schedule.”

Rio, Turquoise Hill and Mongolia government find power solution for Oyu Tolgoi

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Rio Tinto, Turquoise Hill Resources and the Government of Mongolia have reached an agreement on the preferred domestic power solution for the Oyu Tolgoi copper-gold mine, in Mongolia, that, Rio says, paves the way for the government to fund and construct a state-owned power plant at Tavan Tolgoi.

The agreement, which is a revision of the Power Source Framework Agreement (PSFA) signed in 2018, states that the parties will work towards finalising a Power Purchase Agreement by the end of March 2021.

In addition, the amended PSFA sets a proposed timetable for development, with construction of the coal-fired power plant set to begin no later than July 1, 2021, and commissioning within four years thereafter.

Oyu Tolgoi is currently sourcing power from China’s Inner Mongolian Western Grid via overhead power lines, via a back-to-back power purchase agreement with National Power Transmission Grid JSC, the power importing entity, and the Inner Mongolian Power Company, according to Turquoise Hill.

Both the Government of Mongolia and Oyu Tolgoi have committed to extending the current arrangement to ensure continued stable power is supplied to the mine and underground project until the state-owned power plant is commissioned and is able to supply stable, reliable and continuous power, Rio said.

Back in February, Rio, which has a majority stake in Turquoise Hill, said it was continuing to progress options to secure domestically-sourced power for Oyu Tolgoi as part of an obligation to source power by June 30, 2023, under the 2009 Investment Agreement between Turquoise Hill (which owns 66% of Oyu Tolgoi), the Government of Mongolia and Rio, and the subsequent PSFA signed in 2018.

Arnaud Soirat, Rio Tinto Copper & Diamonds Chief Executive, said: “This agreement provides a potential pathway to securing a domestic power supply for the Oyu Tolgoi mine and underground project for the benefit of all shareholders and the wider community. We look forward to working with the Government of Mongolia to progress the solution.”

Oyu Tolgoi produced 146,346 t of copper and 241,840 oz of gold in 2019, with mill throughput running at 40.78 Mt for the year.

Rio, Turquoise Hill put forward coal power plant option for Oyu Tolgoi

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Rio Tinto says it is continuing to progress options to secure domestically sourced power for its majority-owned Oyu Tolgoi copper mine in Mongolia.

The mining major’s domestic search for energy is part of an obligation to source power by June 30, 2023 under the 2009 Investment Agreement between Turquoise Hill Resources (which owns 66% of Oyu Tolgoi), the Government of Mongolia and Rio Tinto, and the subsequent Power Sector Framework Agreement signed in 2018.

In compliance with these agreements, Oyu Tolgoi LLC has submitted to the Government of Mongolia a feasibility study for the Tavan Tolgoi Power Plant (TTPP) project, which involves building a 300 MW coal power plant. This plant, to be located in Tsogttsetsii soum of Umnugovi province, comes with a total project cost estimate of up to $924 million, pending consideration of certain amounts yet to be finalised, Turquoise Hill said. Rio says this amount is already included in the group capital expenditure guidance of $7 billion in 2020 and $6.5 billion each in 2021 and 2022.

In parallel with the TTPP project, and in consultation with the Government of Mongolia, Rio Tinto is also progressing alternative options to source domestic power, including a renewable power component, Rio said.

Oyu Tolgoi is currently sourcing power from China’s Inner Mongolian Western Grid via overhead power lines, via a back-to-back power purchase agreement with National Power Transmission Grid JSC, the power importing entity, and the Inner Mongolian Power Company, according to Turquoise Hill.

Rio Tinto Copper & Diamonds Chief Executive, Arnaud Soirat, said: “Rio Tinto, Turquoise Hill and the Government of Mongolia are all committed to securing a reliable and long-term domestic power source for the Oyu Tolgoi mine and are working together to achieve this.”

Major Drilling helping narrow down Oyu Tolgoi orebody

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Major Drilling says it is nearing the completion of a cave tracking system installation at the Turquoise Hill Resources and Mongolia government-owned Oyu Tolgoi copper-gold mine, in Mongolia.

In early 2000, Major Drilling established a drilling campaign in the middle of the Gobi Desert, with operational supplies needing to ramp up to support 20 rigs that were transported to the site.

This drilling work has since evolved into the tracking system that has proven successful in the block cave operation.

These trackers are lowered through a specially-drilled borehole into the Oyu Tolgoi orebody below. Block cave magnetic beacons are embedded into the orebody and spun to create a magnetic field.

“Magnetisation has been found to be the most effective way to track the fragmentation as an orebody caves in allowing loaders to mine the ore from draw points deep underground,” Major Drilling said.

Major Drilling’s teams strategically place magnetic beacons throughout the mine to create a 3D map and to track the position of the orebody cave-in flow. The cables are attached to the duct rodder, which is lowered from a winch system. Once the trackers are placed, block caving techniques will undercut and fragment the deepest points of the geology, according to the company. The orebody is then collected and taken away for processing.

“Block caving is a low-cost mining method used for the development of massive ore deposits,” Major Drilling says. “Mine planners often use an experienced specialised drilling company to precondition the block cave mining area through hydrofracking. Tracking the flow of the fragmented, caved ore is a critical part of accessing targeted orebodies.”

Mine planners use the information from the magnetic tracking devices placed by the Major Drilling team to understand the direction of intended failure the stone is moving.

Shaun Hogan, Major Drilling’s Project Manager at Oyu Tolgoi, said: “We are nearing the completion of the cave tracking system installation at Oyu Tolgoi. Over the past two years, we have worked very closely with our client and various stakeholders; this partnership has achieved a successful deep tracking network.”

In addition to block cave tracking, Major Drilling also performs seismic monitoring to help predict rock mass instabilities. Seismic monitoring is another specialised drilling service that makes large-scale block cave work safer and more productive.

Major Drilling was awarded the Rio Tinto Growth & Innovation Group Award for the successful seismic drilling program at Oyu Tolgoi in 2017.

Rio revises Oyu Tolgoi cost and production estimates on rock stability issues

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Rio Tinto has provided an update on its majority-owned Oyu Tolgoi copper-gold underground project, in Mongolia, admitting that stability risks identified with the previously approved mine design has led to an estimated cost increase and delay to first production.

First output is now expected to be achieved between May 2022 and June 2023, a delay of 16 to 30 months compared with the original feasibility study guidance in 2016, while preliminary estimates for development capital spend is now $6.5-$7.2 billion, $1.2-$1.9 billion up on the $5.3 billion previously disclosed.

These estimates are preliminary in nature – the equivalent of a conceptual or order of magnitude study – but Rio said a definitive estimate should be forthcoming in the second half of 2020.

Oyu Tolgoi Underground is Rio’s major copper growth project. When the underground mine is fully ramped up, the existing open pit and underground, combined, are expected to produce more than 500,000 t/y of copper.

Alongside this announcement, Rio Tinto also published its June quarter production results, which showed Rio’s share of production of the Oyu Tolgoi open-pit mine was 13,100 t of copper over the period.

Since February, key below ground infrastructure such as the control room facility and the jaw crusher system have been completed and construction of shafts 3 and 4 is progressing well, according to Rio. The commissioning of shaft 2 remains on track for October 2019.

As Rio previously advised, enhanced geotechnical information and data modelling suggests there may be some stability risks identified with the approved mine design. As a result, several other mine design options are under consideration to complete the project.

Rio said: “Studies to date indicate that these options may result in some of the critical underground infrastructure, such as the mid-access drive and the ore handling system, being relocated or removed. Options relating to the sequence of crossing the panel boundaries during mining operations are also being analysed.”

These options are being evaluated to determine the final design of the first panel of mining, “Panel 0”, with the work anticipated to continue until early 2020, Rio said. This is where the definitive estimate date of the second half of 2020 comes from. This estimate will include the final estimate of cost and schedule for the remaining underground project and the preferred mine design approach.

Rio said: “All options under consideration present a pathway to sustainable first production, and have different cost and schedule implications. To date, these have been defined to a level of accuracy associated with a conceptual study or order of magnitude study, and, therefore, significantly more work is required to complete the final assessment.”

Preliminary information now suggests, depending on which mine design options are adopted, first sustainable production could be achieved between May 2022-June 2023. This range includes contingency of up to eight months reflecting the “unexpected and challenging geotechnical issues, complexities in the construction of shaft 2 and the detailed work still required to reach a more precise estimate”, Rio said.

The company added: “The company will continue to focus on minimising the impact to project schedule and cost, as it works through the detailed analysis and testing of each mine design option. Although further work is necessary to reach definitive conclusions, Rio Tinto is reviewing the carrying value of its investment in the project and will announce if any changes are required in the half year results on August 1, 2019.”

Stephen McIntosh, Group Executive, Growth & Innovation, said: “We have made significant progress on a number of key elements in the construction of the underground project during 2019. However, the ground conditions are more challenging than expected and we are having to review our mine plan and consider a number of options. Delays are not unusual for such a large and complex project, but we are very focused as a team on finding the right pathway to deliver this high value project.”

Arnaud Soirat, Chief Executive, Copper & Diamonds, said: “Oyu Tolgoi is a world-class orebody and a world-class business that is already producing copper, employing around 16,000 people and benefitting Mongolia through taxes, royalties and significant procurement. We are working with Turquoise Hill Resources and the Government of Mongolia to complete the underground, which will unlock the most valuable part of the mine for the benefit of all stakeholders.”

Oyu Tolgoi is owned 66% by Turquoise Hill Resources (THR) and 34% by the Mongolian government, with Rio Tinto holding a majority stake in THR.

Autonomous drill rigs, Oyu Tolgoi recognised in Epiroc awards

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Epiroc’s first annual awards have recognised close customer collaboration in Mongolia and innovative autonomous drill rigs in Australia.

Its “United in Performance Award” honours exceptional customer collaboration, the company said. This inaugural award is presented to Anders Berglund, Bayar Torguud, Batzorig Jamsranjav and Alf Lawrence at Epiroc’s Customer Center in Mongolia, as well as to mining company Oyu Tolgoi LLC.

“Their far-reaching collaboration is boosting productivity and safety at Oyu Tolgoi’s major copper mine,” Epiroc said. “With the mine located remotely in the South Gobi desert, Epiroc has developed strong local service capabilities, yielding customer benefits such as on-time spare parts delivery. The companies are emphasising safety and diversity and they have successfully worked together to recruit more women as equipment operators and service technicians.”

The Inspired by Innovation Award, meanwhile, recognises Epiroc’s most innovative technical development that has had a proven commercial success.

It has been presented, this year, to Tyler Berens, Tim Ledbetter and Dustin Penn at Epiroc’s Drilling Solutions division, Lars Eriksson at the Rocktec division, and to Adrian Boeing at the Customer Center in Australia for developing and deploying autonomous Pit Viper drill rigs for BHP.

A fleet of Pit Vipers is operating remotely at iron ore mines in the Pilbara region, some 1,300 km away from the office building in Perth, Western Australia, where BHP’s operators are located.

“This automation solution brings strong customer benefits, including improved work environment, higher productivity and lower operating costs,” Epiroc said.

Back in December, the first autonomous Epiroc Pit Viper 271 drill rig broke ground at BHP’s South Flank iron ore project in Western Australia. This was the first of five autonomous drill rigs to operate at the mine, all of which will be controlled remotely.

Per Lindberg, Epiroc’s President and CEO, said of the awards: “We are proud of our strong teams that continuously focus on making customers more productive and safe while lowering their operating costs. Automation and proactive customer collaboration are two important ways to achieve this.”

The awards will be presented to the winners at the company’s Annual General Meeting on May 9.

Variable rock mass pushes Rio off course at Oyu Tolgoi Underground project

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Rio Tinto has said completion of the Oyu Tolgoi underground copper-gold mine, in Mongolia, could be delayed for several months as detailed geotechnical data has revealed the rock mass is more variable than previously envisaged.

Oyu Tolgoi Underground is Rio’s major copper growth project. When the underground mine is fully ramped up, the existing open pit and underground, combined, are expected to produce more than 500,000 t/y of copper.

In Rio’s 2018 results, the company said the underground project continued to progress last year with the construction of critical above- and below-ground infrastructure. Detailed engineering design work and overall construction progress was mostly on track, with the main focus, in 2018, being on underground lateral development, the fit out of shaft 2 (the main production shaft), support infrastructure and the convey-to-surface decline.

Recent achievements at the operation, owned 66% by Turquoise Hill Resources (THR) and 34% by the Mongolian government, with Rio Tinto holding a majority stake in THR, include the completion of the overland conveyor connecting shaft 2 to the coarse ore stockpile, significant progress on the second underground crusher and the expansion of the central heating plant, Rio said.

“Overall, the underground lateral development has been proceeding well, with a total of 19 km achieved at the end of January 2019, against our second annual reforecast target of 19.8 km,” Rio said.

But, for the second quarterly report in a row, Rio flagged delays in completing the underground project.

“With the structural, mechanical and electrical fitout of shaft 2, it is now clear that the completion of this technically complex installation and commissioning work will be delayed by several months,” Rio said. “Delayed completion of the shaft, which provides additional hoist capacity to accelerate lateral development, will further delay the date we reach sustainable production beyond the nine-month delay indicated in October 2018.”

Back then, difficult ground conditions had slowed progress in some areas of the underground development, but, as the lateral development has continued, Rio said it had learnt more about the rock mass around and under the orebody and has access to more detailed geotechnical data than was available from surface drilling.

“This data reveals there are areas of the mine footprint where the strength of the rock mass is more variable than anticipated in the feasibility study,” Rio said. “This will require some potentially significant changes to the design of some future elements of the development and the development schedule.”

Detailed design work is now underway as is the work necessary to estimate the impact on cost and schedule from these changes and the delay in commissioning shaft 2, Rio said, while admitting that first production was unlikely to occur in the September quarter of 2021 as previously guided.

There were still many positive development takeaways from the mining major’s 2018 results, in addition to the record $13.5 billion it returned to shareholders as part of last year’s operational performance.

This included, among others, an update on the Kemano hydropower project in Kitimat, British Columbia, and the latest on AutoHaul™, the world’s first automated heavy-haul, long distance rail network.

On the former, a $500 million project in its aluminium business where Rio is constructing a required second tunnel at its hydropower facility, the company said it was expecting to complete the project by late-2020.

It will supply the Kemano powerhouse with water from the Nachako Reservoir, creating a back up to the original tunnel built over 60 years ago.

“We completed the starter tunnel in December 2018 and began boring the main tunnel in January 2019,” it said.

The company is carrying out this excavation with a 1,300-t tunnel boring machine (pictured) that will dig 7.6 km of tunnel through a mountain as part of a project to enhance the long-term security of a clean power supply for the BC Works aluminium smelter.

On AutoHaul, Rio said, in December 2018, it successfully deployed the autonomous rail network.

“Since completing the first autonomous haulage run in July 2018, we have steadily increased the number of driverless journeys, with more than 1.6 million km travelled autonomously in 2018,” Rio said.

The programme is now focused on optimising autonomous operations, according to Rio.

Oyu Tolgoi power solution is on the cards

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Turquoise Hill Resources has announced the signing of a Power Source Framework Agreement (PSFA) between Oyu Tolgoi and the Government of Mongolia.

The PSFA provides a binding framework and pathway forward for the construction of a Tavan Tolgoi-based power project, as well as the basis for a long-term domestic power solution for the copper-gold mine, Turquoise Hill said.

Ulf Quellmann, Chief Executive Officer of Turquoise Hill, said: “We are encouraged by the pivotal decision to proceed with the power project at Tavan Tolgoi. Resolving Oyu Tolgoi’s long-term power requirements is critically important to the mine’s long-term development and today’s signing of the PSFA is a positive milestone toward that goal.

“We will continue to work closely and collaboratively with our partners to finalise the details of the power project, which will allow this truly great world-class asset to achieve its full potential for the benefit of all stakeholders.”

The PSFA formalises the role of each party and sets out an amended timetable for Oyu Tolgoi to source power domestically, according to the company. Construction is expected to start in 2020 following further studies and commissioning of the power plant is scheduled for mid-2023.

Oyu Tolgoi will now move forward to confirm the technical design of the project and finalise the commercial arrangements, including financing, underpinning the PSFA, the company said.

The 300 MW plant will be majority owned by Oyu Tolgoi LLC, 51%-owned by Turquoise Hill, and will be situated close to the Tavan Tolgoi coalfields.

Turquoise Hill Resources is 51%-owned by Rio Tinto.

Condra Cranes to speed up Shaft 6 work at Oyu Tolgoi

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Oyu Tolgoi’s copper-gold underground development in Mongolia is set for a boost after its owners ordered two portal machines from South Africa’s Condra Cranes & Hoists.

The pre-sinking phase at OT’s Shaft 6 will use “advanced techniques enabled by pioneering crane design”, Condra said.

Pre sinking is expected to be completed in less than a quarter of the time considered the norm – four months instead of the usual eighteen, the company said.

“The Condra portal is radically different from the level-luffing type of crane traditionally used for pre sinking. Instead, a high-speed, high-lift main hoist removes excavated material vertically, by kibble, through an opening in the centre of a drilling stage positioned by two separate stage winders mounted on the same portal frame,” Condra said.

The portal machines come with a lift speed of one metre per second, 15 times faster than the four metres per minute found in standard mine workshop applications, according to the company.

The advanced portal design was researched during 2013 for incorporation in a prototype machine used at a new diamond mining shaft the following year.

In addition to an innovative frame design and dramatically increased lift speed on the main hoist, the portal crane also incorporates improved drives, gearboxes and safety devices, better cabin access and enhanced operation by remote control.

During the pre-sink phase at OT, the machines will stand over the mouths of the main and auxiliary rescue shafts, and remain in place until the shafts have been drilled, blasted, supported, cleaned and lined with concrete.

Oyu Tolgoi is a combined open-pit and underground project located some 550 km south of Monglia’s capital, Ulaanbataar. It is owned 66% by Turquoise Hill Resources (THR) and 34% by the Mongolian government, with Rio Tinto holding a majority stake in THR.

When the underground mine is fully ramped up in 2027, Oyu Tolgoi is expected to produce more than 500,000 tonnes of copper a year.

Condra began manufacture of the first of the portals for Oyu Tolgoi in early July, when the long-lead assemblies order was received. The main order was received on July 24.

Oyu Tolgoi’s pre-sink cranes will be bigger and faster than the diamond mining machine (pictured), and will feature improved electronics, Condra said. Importantly, lifting speed of the 160 kW 15-t main hoist on the new portals will double to 60 m/min.

The portal frame itself will comprise a 14-m high, 12-m span extended by 3.2-m cantilevers on both sides to allow excavated material to be moved to dump trucks using roads adjacent to the shaft. Stairwells will replace the cat ladders of the diamond mine portal.

Below-ground lift height will be 100 m, and the complete machine will weigh 88 tonnes.

Completion of both cranes, the design of which makes provision for disassembly and containerisation, is scheduled for early November. They will be shipped to Mongolia via China.

Rio updates on Koodaideri, AutoHaul, Amrun and OT underground in H1 results

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Rio Tinto has released its financial results for the first half of the year and the company looks to be balancing profitability, growth investment and shareholder returns.

With EBITDA of $9.2 billion, up 2% year-on-year, operating cash flow of $5.2 billion and the same amount of net debt, the company has flexibility when it comes to where to put its money.

A number of sizeable divestments completed in the first half of the year – tied to coal and aluminium – have allowed the company to pay a $7.2 billion record interim dividend, but it has also greenlit $1.4 billion for what it calls “high-return growth” projects.

Projects under this banner include the Oyu Tolgoi copper-gold underground development in Mongolia, the Amrun bauxite project in Queensland and AutoHaul™, the company’s automated train haulage system in the Pilbara of Western Australia.

In addition to this, the company has agreed to provide $146 million to undertake initial work at its Koodaideri iron ore project in Western Australia, ahead of a final investment decision by the end of the year.

These funds will go towards detailed engineering work on key elements of Koodaideri, development of a rail construction camp and the first stage of an accommodation camp. Rio calls Koodaideri its first “intelligent mine” which, should it receive board and government approvals, will incorporate the “latest in high-tech advances in the industry” using increased levels of automation and robotics.

The prefeasibility study on Koodaideri included a 40 million tonne per year capacity dry crushing and screening plant, non-process infrastructure, product stockyards, rail loop and load-out and a 170 km AutoHaul rail link to the main line. This came with a capital cost of some $2.2 billion and potential for construction to commence in 2019, followed by first production in 2021. Phase two of Koodaideri could potentially take the operation to beyond 70 Mt/y.

In an update in June, the company said the Koodaideri feasibility study would use “data centric and advanced digital engineering to produce a digital twin of the asset”, while there was over 100 “innovation opportunities” within the FS.

The project is expected to deliver replacement tonnes to the company’s Pilbara operations as other mines come to an end of their lives.

In terms of AutoHaul, which the company has approved $940 million of spend on, Rio said around 65% of trains at the end of the June quarter had run in either driver attended or autonomous mode and more than 3.3 million kilometres had now been completed in this mode of operation.

The system, focused on automating trains transporting iron ore to Rio’s port facilities, received accreditation to run trains in autonomous mode from the National Rail Safety Regulator on May 18 and the first loaded autonomous journey took place on July 10. Full implementation of the autonomous programme is expected by the end of 2018.

At the $1.9 billion Amrun bauxite expansion project on the Cape York Peninsula, in north Queensland, development is advancing to plan with first shipment expected in the first half of next year. The stacker and reclaimer have been transported to site following completion of fabrication, while shiploader assembly is also nearing completion.

The Amrun expansion is expected to increase the company’s bauxite shipments by 10 Mt/y.

At the Oyu Tolgoi underground project, contractor numbers are approaching their peak, with a workforce of over 7,500 (89% Mongolian nationals) at the end of June.

Shaft two equipping and headframe fit-out as part of the $5.3 billion project is in progress, and the shaft five ventilation system has been fully commissioned and is now operational. Construction of the first drawbell at the block cave development is still expected in mid-2020.

When the underground is fully ramped up in 2027, Oyu Tolgoi is expected to produce more than 500,000 tonnes of copper a year.

Lastly, development of the A21 project at the Diavik diamond mine in Canada, which Rio owns 60% of, is ahead of schedule with first ore uncovered in March and the mine expected to be at full  capacity during the December quarter of 2018.

A21 is expected to sustain the mine’s production levels at 6-7 million carats and extend the life beyond 2023.