Oyu Tolgoi LLC released its 2018 Year in Review today. Oyu Tolgoi had a very productive year in 2018 with strong achievements across all aspects of the business including: safety, production, underground project development, environmental and social performance.
Oyu Tolgoi LLC’s Chairman of the Board of Directors, Ambassador Batsukh Galsan noted: “We have delivered tangible results for all of our shareholders through the sustainable and efficient operation of the open-pit mine and further advanced the underground development project. Oyu Tolgoi has made a huge effort in creating and sharing knowledge and skills with all key stakeholders and the Mongolian public.”
In June 2018, the Board approved the 10 year business development strategy of the company. The strategy defines the key priorities and the development path for the next 10 years. The key priorities include a strategic mine development plan, enhancing employees’ skills and capabilities, construction of a power plant, the development of partnership opportunities and the local workforce in the Umnugovi province, the implementation of the marketing strategy and as well as the maintenance of our compliance framework.
Oyu Tolgoi LLC CEO Armando Torres emphasised: “We continue to deliver on our key agreement commitments through our firm and consistent efforts for the benefit of all our stakeholders. With only five years of operations, Oyu Tolgoi is already considered to have set a global benchmark on several business and social parameters and has become an important pillar for the development of Mongolia. 2018 was also a year of progress with improvements to the productivity and skills development of our workforce for Oyu Tolgoi.”
The Year in Review highlights priorities for 2019 in addition to the company results for 2018. The company continues to sustain its improvement rate into 2019 and delivers consistently on the benefit commitments to its shareholders. Successful delivery of the underground project will make Oyu Tolgoi one of the largest copper mines in the world and a significant contributor to the prosperity of Mongolia.
Brief highlights of the Year in Review:
Safety
An All Injury Frequency Rate of 0.16 per 200,000 work hours in 2018 was a new record for the operation. This achievement is more impressive considering the workforce doubled year on year as the ramp up of the underground project progressed.
Production & Financial Performance
Sales revenue of $1,180 million – a 25% increase compared to the previous year.
Production of 746 thousand dry metric tonnes (kdmt) (2017: 724kt) of copper concentrate with metal content of 157 thousand tonnes (kt) copper; 248 thousand ounces (koz) gold; 873koz silver (2017: 149kt copper; 111koz gold; 860koz silver).
Underground development
Throughout 2018, construction of the underground project continued with the successful completion of several critical path assets, from fully commissioning of the ventilation shaft 5 to completing the sinking of Shaft 2, one of the largest shafts on the planet. The detailed engineering design work is near to be completed and overall construction reached the mark of 46% of progress (currently 54% as of end of May 2019). However, more detailed geotechnical information and difficult ground conditions have required a review of the mine design. This, combined with the technically complex fit-out and commissioning work on the main production and service shaft, is ultimately expected to result in a further revised ramp-up schedule and delayed sustainable production date beyond the nine months indicated in October 2018. Detailed estimates are being calculated to assess financial impact and amended schedule.
Community partnership & Corporate Social Responsibility
Key highlights include: commissioning of the Khanbogd School and the Kindergarten complex which has the capacity for 600 students and over 200 children, construction of the Inter-Soum Animal Healthcare Centre and commissioning of the 35km road from Khanbogd to the Oyu Tolgoi mine site.
The Year in Review – 2018 is available here.
Leave a Reply