Rio Tinto announces its biggest profit since 2011, on the back of booming iron ore prices.
The parliament voted to replacing the 34% interest with a special royalty and to bring forward the date to receive dividends from the mine, currently set at 2041. The parliament responds to the Working Group demands to revise the Oyu Tolgoi deal and is strengthened by by a cliam accepted in court by the NGO Darkhan Mongol Nogoon Negdel arguing that the 2015 Dubai agreement in 2015 did not follow due process.
Rio Tinto announces that production is projected to start at least a year later than expected (between May 2022 and June 2023), and subsequent costs may increase with almost USD 2 billion.
Shareholders reject the re-election of board members supported by Rio Tinto and blame Rio Tinto for delays, as shares value drop by 44%. Read more
The parliamentary Working Group appointed to review the implementation of the Investment Agreement, submits a report to the National Security Council in March. It recommends a revision of both the 2009 and 2015 agreements. In particular, the 2015 Dubai agreement is questioned, as it was not approved by parliament.
Simon Thompson, chair of Rio Tinto on 26 November 2018: “We do face some intractable problems, including our reliance on coal-fired power in Mongolia and in South Africa. However, in both cases, our operations clearly bring huge economic and social benefits, and play a major role in poverty alleviation in two relatively poor countries […]
When we invest in a country like Mongolia, for example, we plan to be there for a hundred years and we know that our franchise depends upon building durable partnerships with our employees, our local suppliers, our local communities and the government.”  Read more
Majority shareholder Sailingstone Capital demands more transparent corporate governance, questioning the independence of TRQ management from majority shareholder and operator Rio Tinto. Shareholders receive little dividend as operation costs remain high.
The publication “Mining taxes” explains how the mining giant Rio Tinto, and its Canadian subsidiary Turquoise Hill Resources, avoided nearly $470 million in Canadian taxes by using mailbox companies in two tax havens, Luxembourg and the Netherlands.
The publication also shows how an abusive investment agreement covering the Oyu Tolgoi copper and gold mine has resulted in a $230 million tax revenue loss for Mongolia. All in all, Rio Tinto’s tax schemes lead to nearly $700 million tax revenue losses for Canada and Mongolia.
Turquoise Hill Resources (TRQ) receives a USD 155 million tax bill from the Mongolian Tax Authority, as a result of a tax audit covering 2013 until 2015.
TRQ and Rio Tinto have acquired a license to start a drilling programme for fields unrelated to Oyu Tolgoi.