No Tax Income from Oyu Tolgoi for Mongolia Unless Issues are Resolved

Turquoise Hill Resources, the investor in the Oyu Tolgoi project, has published a short press release about the ongoing discussions with the Mongolian government.

Thanks to this tweet from Enkhbat Dangaasuren for the link.

We learn that they are talking to the Mongolian government, as well they should with the stakes involved for both sides.

We learn close to nothing about what they or the government said at those talks, except that they repeat their position that they expect existing agreements to be honored:

We are open and willing to consider opportunities related to the implementation of the Investment Agreement and companion Shareholders’ Agreement that will assist the Government as long as it preserves the respective agreements.

We learn that the talks have not reached an agreement yet and will be continued.

The central sentence of the press release is this:

Oyu Tolgoi is expected to reach commercial production by the end of June 2013 subject to the resolution of the issues being discussed with the Government.

Translation: Dear government of Mongolia, you can count on tax income from this project from this year on. You can count on zero such tax income if you don’t respect our existing agreements.

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Published by kflenz

Professor at Aoyama Gakuin University, Tokyo. Author of Lenz Blog (since 2003, lenzblog.com).

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