Ivanhoe Mines Ltd. founder and Chief Executive Officer Robert Friedland said Rio Tinto Group released “unauthorized and incomplete” information about Oyu Tolgoi, the Mongolian mine they’re jointly developing.
The information was presented during an investor briefing by senior management, Friedland said today in a statement.
Andrew Harding, chief executive officer of Rio’s copper unit, said yesterday at an investor presentation in London that talks were under way regarding a review of the investment agreement with Mongolia that governs the mine’s development. Rio also is seeking to resolve uncertainty over power supplies for the project, Harding said. Commercial operation of the mine may be delayed if the source of electricity can’t be agreed to in the coming months, he said.
Ivanhoe, based in Vancouver, owns 66 percent of Oyu Tolgoi, one of the world’s largest untapped copper-and-gold deposits, and Mongolia owns the rest. London-based Rio has a 48.5 percent stake in Ivanhoe. The Canadian company spent more than six years negotiating with Mongolia to develop the mine, reaching an accord in October 2009.
Rio and Ivanhoe are awaiting the outcome of arbitration proceedings following a dispute that stems from Ivanhoe adopting a shareholder rights plan in April last year. The so-called poison pill would allow Ivanhoe to issue new shares to block an attempted takeover.
Oyu Tolgoi Terms
Mongolia will seek to revise the investment terms for Oyu Tolgoi, Finance Minister Sangajav Bayartsogt told News.mn portal in an interview published yesterday. News reports about a review of the agreement should be assessed in the context of Mongolian elections next year, Harding said yesterday.
“Ivanhoe Mines will provide further details in a future statement following communication directly with Rio Tinto on the specifics of its concerns,” the Canadian company said.
Tony Shaffer, a Rio spokesman, declined to comment.
Ivanhoe dropped C$1.77, or 9.4 percent, to C$16.97 as of 4 p.m. in Toronto Stock Exchange trading, the seventh-largest decline on the Standard & Poor’s/TSX Composite Index. The shares have declined 26 percent this year. Rio fell 148.5 pence, or 4.2 percent, to 3,389 pence on the London Stock Exchange.
Rio is the world’s second-largest mining company after Melbourne-based BHP Billiton Ltd.