20 May, 2015

Shearman & Sterling represented Erdenes Oyu Tolgoi LLC, a Mongolian state owned company, in its complex negotiations with Rio Tinto with regard to the massive Oyu Tolgoi mining project in Mongolia.

Oyu Tolgoi is a major copper-gold mines located in the South Gobi region of Mongolia. It is being developed as a joint venture between the Government of Mongolia with 34% ownership and Rio Tinto’s Turquoise Hill Resources division with 66%. Approximately USD 6bnhas already been invested into the project.

On Monday the Prime Minister signed an “Oyu Tolgoi Underground Mine Development and Financing Plan” along with Erdenes Oyu Tolgoi LLC, Turquoise Hill Resources and Rio Tinto to clear the way for the development of the underground mine at Oyu Tolgoi.  Market expectations are that this will have a significantly positive impact on Mongolia’s economic prospects as it will clear away a major concern for international investors.

The Oyu Tolgoi mining project comprises an open pit mine, which has been operational since 2013, and an underground mine to be developed. Once fully operational, it is expected to account for approximately 40% of Mongolia’s gross domestic product.

The core Shearman & Sterling team included partners Matthew Bersani, and Andrew Ruff.

Conventus Law