Ivanhoe Targets Late-2012 Startup at Oyu Tolgoi


Mongolian Prime Minister Sukhbaatariin Batbold recently led an onsite inspection of construction progress at
Oyu Tolgoi by members of the government’s Cabinet and Parliament. Shown here, during the visit, are (L-R):
SouthGobi MP Badamsuren, Mineral Resources & Energy Minister Zorigt, Finance Minister Bayartsogt,
Environment and Tourism Minister Gansukh, SouthGobi MP Bayarsaikhan and Education, Science & Culture
Minister Otgonbayar. (Photo courtesy of Ivanhoe Mines).
Ivanhoe Mines reported in early September 2010 construction at the company’s Oyu Tolgoi copper-gold complex in Mongolia is proceeding on schedule and that first ore is expected to be processed during the fourth quarter of 2012. Maintaining the current pace of construction will ensure commissioning of major production systems within about two years, when initial ore from the new open-pit is expected to be running through the primary crusher and into storage and when at least one of the concentrator’s two ore-grinding circuits will be in the commissioning stage.

“We expect to meet our declared goal of beginning full commercial production at Oyu Tolgoi in 2013,” said Ivanhoe President and CEO John Macken.

The Oyu Tolgoi concentrator is initially slated to process 100,000 mt/d of ore. Average annual production during the first 10 years of operation is projected to exceed 544,000 mt/y of copper and 650,000 oz/y of gold in concentrates. Ore initially will be sourced from an open-pit mine on the Southern Oyu deposits. At the same time, the adjacent, higher-grade underground mine on the Hugo Dummett deposit is scheduled to be developed toward full production of 85,000 mt/d. An expansion of the concentrator will provide for the processing of ore from both the open-pit and underground when operations reach full capacity.

“One nearer-term goal is to complete the foundations and allow the erection of the exterior steel to enclose the concentrator building before the onset of winter in 2011 so work can continue indoors until the start of the 2012 outdoor construction season,” Macken said.

The Oyu Tolgoi workforce has increased to approximately 4,400. The budget for construction in 2010 is set at $754 million. A $58-million program will provide technical and vocational training to equip up to 3,300 trainees to be eligible for jobs at Oyu Tolgoi. Training programs were scheduled begin at 12 vocational institutes in early October 2010 and to extend to another 24 institutions next year. Two new vocational training centers will be built, and five selected educational institutions will be upgraded. The program also will provide scholarships each year to 200 students studying at Mongolian and international universities.

According to the company, the project is committed to ensuring that Mongolians hold at least 60% of the available jobs during construction and 90% of the jobs during production. During the period from January 1 to August 15, 2010, the project signed 98 contracts with Mongolian companies, having a total value of $206 million. Mongolian companies also filled 849 purchase orders totaling $50.2 million during the same period, accounting for 86% of all purchase orders for the project.

As featured in Womp 2010 Vol 08 - www.womp-int.com