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Be the first with the news that moves the market- Development at Turquoise Hill’s (TSX:TRQ) Oyu Tolgio mine, in Mongolia has slowed, due to the effects of COVID-19 in the region
- Travel restrictions could impact the site’s underground development by up to 30 per cent, as key members cannot access the site
- Furthermore, ongoing border disruptions between China and Mongolia have recently made transporting resource concentrate challenging
- However, the company was quick to point out that mining activities from the site’s open pit remain fully operational
- Turquoise Hill (TRQ) is holding steady, with shares trading for C$0.70 and a market cap of $1.41 billion
Development at Turquoise Hill’s (TSX:TRQ) Oyu Tolgio mine in Mongolia has slowed, due to the effects of the COVID-19 pandemic in the region.
However, the company was quick to point out that mining activities from the site’s open pit remain fully operational.
Restricted access to the site, caused by travel bans, is slowing the development of an underground mine. As a result, the company has placed two of the site’s underground shafts on care and maintenance, until key team members can return and continue work.
The company estimates that travel restrictions like these could slow underground development progress by up to 30 per cent.
The development of the mine’s design remains ongoing and should be released in 2020’s first half. The Definitive Estimate of project cost and schedule is also still on schedule and is expected in the 2020’s second half.
Despite the latest hurdles facing the project, the site is still within the 16- to 30-month delay. The company announced this delay previously in July of last year, before COVID-19 struck.
On the logistics side, ongoing border disruptions between China and Monolgia have continued to impact supply chains in the region. Consequently, transportation of the company’s resource concentrate has been a challenge.
Turquise Hill remains in talks with Mongolia’s and China’s governments, in hopes of rectifying the transport issues in the near future.
Ulf Quellmann, CEO of Turquoise Hill, believes the company is doing what it can to navigate the challenging industry environment.
“Oyu Tolgoi is adapting to the challenges posed by the COVID-19 pandemic on both the open pit and underground operations. The open-pit is continuing to operate without interruption, while the underground development is experiencing a slow-down.
“We will continue to update the market as the impact of COVID-19 becomes clearer,” he said.
Turquoise Hill (TRQ) is holding steady, with shares trading for C$0.70 at 2:06pm EST.
