Rio secures Oyu Tolgoi power deal
RIO Tinto has been given a big boost with the finalisation of a long-awaited electricity deal for the company's most important growth project.
The $US6 billion Oyu Tolgoi mine in Mongolia will be powered by a Chinese power company in a deal to import electricity across the border.
Talks on the deal have been under way for more than a year, and delays in reaching an agreement recently emerged as the major cloud hanging over the new copper and gold mine.
Mongolia and China have been bitter rivals for centuries, and a failure to secure a power deal could have significantly delayed the start and capacity of Oyu Tolgoi.
Even on current schedules, the start of commercial production might only just occur within the promised timeline of the first half of 2013.
Rio did not reveal the name of the power company, but said the agreement was binding.
The news came on a good day for Rio on the local market, where the stock rose from $57.38 to $58.88.
Meanwhile, goldminer Newmont has appointed a new head of Asia-Pacific and deferred the expansion of its Tanami mine as it begins a global program of cost cutting.
Jeff Huspeni, the company's senior vice-president of Asia-Pacific, will retire in March after 30 years at Newmont, paving the way for senior vice-president of South American operations Carlos Santa Cruz to take over. With AAP