Rio Tinto’s Oyu Tolgoi lifts gold guidance after strong start to 2016

TORONTO (miningweekly.com) – Rio Tinto subsidiary Turquoise Hill Resources, which owned a 66% interest in the significant Oyu Tolgoi copper/gold mine, in Mongolia, on Tuesday said that the mine’s first-quarter performance was so strong, that it hiked its full-year production guidance.

For the three months ended March 31, Vancouver-headquartered Turquoise Hill advised that the Oyu Tolgoi operation’s concentrator throughput reached a quarterly high, as well as better-than-expected gold production.

As a result, the company was increasing its 2016 gold production guidance to reflect the mine accessing more of the final, high-gold benches in Phase 2 of the openpit. Also during the quarter, Oyu Tolgoi exceeded two-million tonnes of concentrate shipped.

During the period, concentrator throughput increased 3.1% quarter-on-quarter, resulting in average throughput of about 106 000 t/d for the quarter. Concentrate production in the first quarter remained high, owing to increased throughput and strong copper grades. Copper output in the period reached a quarterly high, increasing 0.5% over the previous period.

Turquoise advised that, as expected, gold output in the period declined about 30% over the previous quarter, owing to lower grades and the near completion of mining in Phase 2 of the openpit.

Given the stronger-than-expected first-quarter gold output, Turquoise Hill had increased its 2016 gold in concentrates guidance to a range of 255 000 oz to 285 000 oz, up from 210 000 oz to 260 000 oz forecast previously.

Oyu Tolgoi was also expected to produce 175 000 t to 195 000 t of copper in concentrates for 2016.

Turquoise Hill expected a notice-to-proceed decision for the $6.8-billion underground expansion of its massive Oyu Tolgoi mine – one of the largest in the mining industry.