Mongolia slaps $155M tax bill on Turquoise Hill’s mine; NGO claims company owes more – by Gabriel Friedman (Financial Post – January 30, 2018)

http://business.financialpost.com/

Turquoise Hill Resources Ltd. and parent Rio Tinto Group’s ambition to build one of the world’s largest copper and gold mines, called Oyu Tolgoi, in Mongolia’s Gobi Desert, has hit a number of stumbling blocks in recent weeks.

Last week, Jean-Sebastien Jacques, the chief executive of Rio Tinto, flew to Mongolia’s capital city to meet with prime minister Ukhnaagiin Khurelsuk about how to build “win-win” partnerships.

One looming dispute is the Mongolian government’s claim that Oyu Tolgoi owes an additional US$155 million in taxes — the mine’s second tax dispute since 2014.

In another setback, earlier this month, Turquoise Hill also declared a ‘force majeure’ after a convoy of trucks hauling concentrate from Oyu Tolgoi to China, where it is smelted, was disrupted by protests at the two countries’ border.

Jacques did not announce solutions to either problems, but his visit may not have been fruitless. He announced a working group with the Mongolian government to address issues such as the high funding costs of Oyu Tolgoi, power solutions and how to enable more money to flow to the town next to the mine. The company also announced opening a new office in the country.

For the rest of this article: http://business.financialpost.com/commodities/mining/mongolia-slaps-155m-tax-bill-on-turquoise-hills-mine-ngo-claims-company-owes-more

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