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Turquoise Hill’s stock tanks on Mongolia troubles

Oyu Tolgoi mine. Image courtesy of Turquoise Hill Resources

Turquoise Hill’s (NSYE: TRQ) stock tanked over 42% on Tuesday, after releasing its Q2 2019 report, revealing costs for the expansion of its Oyu Tolgoi mine could increase by up to $1.9 billion.

The estimated cost was initially pegged at $5.3 billion. Oyu Tolgoi is the Vancouver-based company’s only asset.

Turquoise Hill is owned 50.8% by mining giant Rio Tinto. Rio issued a separate statement Tuesday, saying difficult ground conditions could raise the estimated costs of the copper-gold mine’s expansion, and warning the project could be delayed potentially over two years.  

First production is now expected between May 2022 and June 2023.

On a trading day that saw volume reach 49.8 million on the Nasdaq, nearly 10 times the average volume, Turquoise Hill’s value was pushed down to $1.2 billion.

It is an all-time low for the company, whose market capitalization once sat at over $6 billion.