The TTPP Power Source Framework Agreement signed
The Ministry of Energy and Oyu Tolgoi joint announcement
Ulaanbaatar, 31 December, 2018: The Government of Mongolia and Oyu Tolgoi LLC have signed the Power Source Framework Agreement (PSFA) which sets out the pathway for Oyu Tolgoi (OT) to construct the Tavan Tolgoi Power Project (TTPP) and secures a long-term domestic power solution for OT and the wider South Gobi region.
Ts. Davaasuren, Member of the Cabinet and Minister of Energy of Mongolia said “In accordance with the resolution from the Government of Mongolia, we are signing this agreement. With the PSFA, a legal basis has been put for Oyu Tolgoi LLC to fully supply its operational power needs from national sources.”
The agreement outlines the fundamental principles for sourcing a domestic power solution for Oyu Tolgoi, the key roles of each of the parties and the technical design of the project. The 300 megawatt plant will be majority owned by Oyu Tolgoi and will be situated close to the Tavan Tolgoi coalfields. The partners will also consider how to utilise renewable power sources as part of the overall solution.
The signing of the power agreement is a significant step towards enhancing economic efficiency of the Tavan Tolgoi coal mines, construction of related infrastructure in compliance with the Parliamentary resolution No 73 issued in 2018 and supplying the southern region with domestic power and securing long term sustainable Oyu Tolgoi’s operation, especially its underground mine.
Armando Torres, Chief Executive Officer, Oyu Tolgoi LLC said “Signing the Power Agreement is an important milestone for the future success of Oyu Tolgoi and is a testament to all shareholders’ ability to find a genuine win-win solution.”
Arnaud Soirat, Chief Executive of Rio Tinto’s Copper & Diamond business added, “Oyu Tolgoi is a Mongolian company, employing more than 15,000 Mongolians, and we are delighted to announce with the Government an agreement to source power for the operation from within the country which is a big step forward.”
Ulf Quellmann, Chief Executive Officer of Turquoise Hill, said, “The approval of the PSFA follows extensive negotiations between the Government, Oyu Tolgoi and Rio Tinto. We will continue to work closely with our partners to finalise the details of the power project which will allow the mine to achieve its full potential for the benefit of all stakeholders.”
The PSFA has been signed by Ts. Davaasuren, Minister of Energy and A. Tleikhan, Head of Energy Regulatory Commission representing the Government of Mongolia; and G. Batsukh, Chairman of the Board of Directors and Armando Torres, CEO representing Oyu Tolgoi LLC.
About Oyu Tolgoi LLC (www.ot.mn)
Oyu Tolgoi LLC, Mongolia's largest copper and gold mining company, is a strategic partnership between the Government of Mongolia, Turquoise Hill Resources and Rio Tinto. Located in the South Gobi, Oyu Tolgoi commenced shipment of product to customers in July 2013. Oyu Tolgoi is managed by Rio Tinto, which is investing global expertise and cutting-edge technology to help develop Mongolia’s mining industry and ensure Oyu Tolgoi is one of the world’s most advanced mines. For Oyu Tolgoi, nothing matters more than safety. The business operates under the principle that if a job cannot be done safely, it will not be done at all.