Mongolia is demanding increased profit payments and a larger revenue share from the Oyu Tolgoi copper mine, co-owned with Rio Tinto, reopening negotiations over the project’s commercial terms. The Mongolian government, which holds a 34% stake via Erdenes Mongol LLC, seeks to raise its share of returns to approximately 60% and accelerate dividend payments, currently delayed until the repayment of a substantial loan to Rio Tinto.
The existing agreement postpones dividends to Mongolia until it settles a multi-billion-dollar loan linked to development costs that exceeded initial estimates. Additionally, tensions have escalated as Mongolia sues Rio Tinto for an alleged $450 million in tax underpayments related to the 2021 and 2022 tax years. The stakes are high, with Rio Tinto anticipating that Oyu Tolgoi will rank as the world’s fourth-largest copper mine by 2030, as demand for copper increases amidst the global energy transition.
