Oyu Tolgoi announces performance results for fourth quarter of 2019

2020-02-12 12:19:12

Ulaanbaatar /MONTSAME/. Today, February 12, Oyu Tolgoi CEO Armando Torres along with the company’s senior managers held a press briefing to introduce the performance results for the fourth quarter of 2019. 

Some highlights of the Oyu Tolgoi mining project’s performance in 2019 are: 

Oyu Tolgoi continued its globally competitive safety performance

Total in-country spend has passed US$10 billion

US$321 million taxes paid and US$431 million on national procurement in 2019

Maintains the guidance for copper production – 146,346 tons of copper in concentrate

Exceeds 2019 full-year production guidance for gold – 241,840 ounces of gold in concentrate

Completed the construction of primary production shaft (Shaft 2) of the underground mine

Reached highest performance record for the underground lateral development

In 2019, Oyu Tolgoi continued to progress and deliver important milestones for the underground mine development and make a significant contribution to the Mongolian economy, passing U$10 billion of in-country spend.

Prioritizing and maintaining excellence in safety, Oyu Tolgoi’s All Injury Frequency Rate (AIFR) was 0.16 per 200,000 hours worked in 2019.

As of 31st of December 2019, over 93 per cent of Oyu Tolgoi’s workforce of 13,800 were Mongolian with more than half working on the development of the underground mine.  Oyu Tolgoi provided 680,354 people-hours of training in 2019. 

Within this scope, Oyu Tolgoi provided the internationally recognized and accredited training to its 348 employees in the last year in cooperation with Holmesglen, the registered training organization in Australia.

In 2019, Oyu Tolgoi paid US$321 million in taxes, fees and other payments and collaborated with 838 suppliers, 564 of which were Mongolian businesses which accounted for 76 percent of total operations procurement spend.

Partnership was a key priority in 2019, with Oyu Tolgoi contributing to public health, primary education, infrastructure and many other areas. 

In terms of major infrastructure projects, the highlights were the opening of the Oyu Tolgoi-Khanbogd 35.1-km paved road, the opening of a new hospital in Mandal-Ovoo soum, and the completion of the fifth kindergarten in Umnugovi province, sponsored by the Oyu Tolgoi funded Gobi Oyu Development Support Fund.

Underground Development Update

Construction of the primary production shaft (Shaft 2) was completed in October 2019, which allows the movement of 300 people per cage cycle versus a maximum of 60 people per cage cycle through Shaft 1. Underground development materials will be lifted to surface via the Shaft 2 production hoist.

Productivity improvement measures resulted in increased underground lateral development rates during the fourth quarter, with an average rate of 1,607 equivalent meters (eqm) compared to 1,214 eqm in the third quarter, with December seeing a record of 1,809 eqm.

Construction is progressing on Shafts 3 and 4 with both collars now installed. Final preparations are now underway to enable commencement of main sinking operations for both shafts during the second quarter of 2020.

"We continue to expect to complete the mine design in the first half of 2020 and the Definitive Estimate of cost and schedule in the second half of 2020."

Production for fourth quarter of 2019

As anticipated, mined copper production from the open pit was eight per cent lower than 2018 as mining activity moved to lower grade areas. Grades were 11 per cent lower for the year reflected in the 21 per cent decline in fourth-quarter production, partly offset by productivity improvements.

Other highlights:

  • Full-year copper production in concentrate of 146,346 tons vs original guidance range of 125,000 – 155,000 tons in concentrate
  • Full-year mill throughput of 40,777,225 tons, an increase of 5 per cent over 2018
  • Full-year gold production in concentrate of 241,840 ounces vs original guidance range of 180,000 – 220,000 ounces in concentrate

Oyu Tolgoi's production and sales data for 2018 and 2019 can be found here

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