Hawkmoon Resources

Turquoise Hill Resources Announces Q4 2017 Production Results; Oyu Tolgoi receives Tax Act from Mongolian Tax Authority

VANCOUVER, BC--(Marketwired - January 15, 2018) -

  • Oyu Tolgoi meets 2017 production guidance; achieves record material mined and throughput
  • Shaft 2 reaches final depth in December 2017

Turquoise Hill Resources (NYSE: TRQ) (TSX: TRQ) (NASDAQ: TRQ) today announced fourth quarter 2017 production for Oyu Tolgoi.

Jeff Tygesen, Chief Executive Officer of Turquoise Hill, said, "Oyu Tolgoi had a strong fourth quarter setting quarterly and annual records for open pit material mined as well as concentrator throughput. They also met annual production guidance, which is an excellent achievement given the grade challenges of 2017. We are extremely proud of Oyu Tolgoi's numerous accomplishments for the year."

Material mined in Q4'17 increased 5.3% over Q3'17 and ore treated increased 2.1% over Q3'17. Higher mill availability and processing of softer Phase 6 ore in Q4'17 resulted in a 20.8% increase in concentrate production over Q3'17. Copper production in Q4'17 increased 22.8% compared to Q3'17 due to higher grades and improved mill availability. Gold production in Q4'17 increased 12.9% over Q3'17 due to increased grades and higher concentrate production.

Oyu Tolgoi is expected to produce 125,000 to 155,000 tonnes of copper and 240,000 to 280,000 ounces of gold in concentrates for 2018.

Underground development progress

During Q4'17, underground development continued to progress with Shaft 2 reaching final depth of 1,284 metres in December. Completed sinking of Shaft 2 is expected imminently and fit out is expected throughout 2018. Sinking of Shaft 5 also progressed during Q4'17 and is expected to be complete in Q1'18. Also in December, the fifth development crew became fully operational.

Oyu Tolgoi Production Data
All data represents full production and sales on a 100% basis
  4Q 2016 1Q 2017 2Q 2017 3Q 2017 4Q 2017 Full Year
2017
Full Year 2016
               
  Open pit material mined
  ('000 tonnes)
25,615 24,333 25,193 27,466 28,929 105,921 96,938
  Ore treated ('000 tonnes) 9,819 10,087 9,637 10,615 10,838 41,177 38,152
  Average mill head grades:              
    Copper (%) 0.61 0.51 0.51 0.48 0.53 0.51 0.65
    Gold (g/t) 0.25 0.15 0.16 0.18 0.20 0.17 0.36
    Silver (g/t) 1.50 1.30 1.38 1.34 1.54 1.39 1.83
  Concentrates produced
  ('000 tonnes)
206.7 176.0 171.0 170.0 205.4 722.5 846.6
  Average concentrate
  grade (% Cu)
22.0 21.6 21.8 21.7 22.0 21.8 23.8
  Production of metals
  in concentrates:
             
    Copper ('000 tonnes) 45.5 38.1 37.2 36.9 45.3 157.4 201.3
    Gold ('000 ounces) 49 25 24 31 35 114 300
    Silver ('000 ounces) 273 215 236 239 285 974 1,420
  Concentrate sold
  ('000 tonnes)
182.0 190.2 182.0 176.6 175.5 724.3 828.6
  Sales of metals in
  concentrates:
             
    Copper ('000 tonnes) 37.6 39.5 37.3 36.9 35.7 149.3 188.9
    Gold ('000 ounces) 39 32 23 29 27 111 347
    Silver ('000 ounces) 239 205 222 229 205 860 1,280
  Metal recovery (%)              
    Copper 76.6 74.9 74.6 73.5 78.0 75.4 81.0
    Gold 63.4 48.8 47.7 51.2 50.5 49.7 68.5
    Silver 57.2 51.8 53.9 52.8 53.0 52.9 63.1

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Turquoise Hill Resources today announced that Oyu Tolgoi LLC has received, and is evaluating, a Tax Act ("tax assessment") for approximately US$155 million from the Mongolian Tax Authority relating to an audit on taxes imposed and paid by Oyu Tolgoi LLC between 2013 and 2015.

Turquoise Hill is of the firm view that Oyu Tolgoi LLC has paid all taxes and charges required under the Investment Agreement (and reconfirmed in the Underground Mine Development and Financing Plan) and Mongolian law. The tax assessment is being evaluated by Oyu Tolgoi LLC and a response will be issued within the timeframe required by Mongolian Law. 

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