Turquoise Hill output at higher end of target
Rio Tinto-controlled Turquoise Hill Resources (TSE:TRQ) on Monday announced that production in the final quarter of 2014 rose thank to higher grades despite a concentrator fire at its massive Oyu Tolgoi mine in Mongolia earlier in December.
Turquoise Hill, which owns 66% of Oyu Tolgoi with the remainder held by the government of the Asian nation, for the full year 2014 mined 589,000oz of gold and 148,000t of copper in concentrates.
Output was towards the top end of forecasts that were adjusted downwards in October to 550,000oz – 600,000oz of gold and 135,000t – 150,000t copper.
The Vancouver-based company is keeping its production estimates for 2015 to 600,000oz – 700,000oz of gold and 175,000t to 195,000t of copper in concentrates. The mine also produces small quantitates of silver.
Turquoise Hill said in a statement repairs from the fire were completed on January 2 and the concentrator has returned to full production. Based on the 2015 mine schedule, production from the high-grade zone is expected to resume in mid-2015.
Operating cash costs were expected to be about $900 million and capital expenditures were expected to be $230 million, of which roughly $185 million related to sustaining capital.
Rio Tinto, which owns just over half of Turquoise Hill, has been in talks with the Mongolian government for a $5.4 billion expansion of Oyu Tolgoi for nearly two years, but no deal has been reached due to disagreements over funding of the underground project.
Shares in Turquoise Hill gained nearly 2% in Toronto on Monday (New York was closed due to a public holiday) where it is worth $6.7 billion, but is down 7% since the start of the year as the price of copper declines to multi-year lows.