Reports: Rio Tinto To Cut 1,700 Jobs At Oyu Tolgoi Mine

(RTTNews) - Anglo-Australian mining giant Rio Tinto Plc. (RIO, RIO.L, RIO.AX) reportedly plans to cut as many as 1,700 jobs at its Oyu Tolgoi copper-and-gold mine in Mongolia, following disputes with the government on various issues including revenue sharing and jobs to the local population.

The miner had said in late July that it was notified by the Government of Mongolia that the terms of the project financing provisionally secured for the underground development of Oyu Tolgoi would need to be approved by the Mongolian Parliament, which was in summer recess at that time.

Considering the uncertainty, including continued discussions with the Government on a range of other issues, Rio said then that all funding and work on the underground development would be delayed until these matters are concluded and a new timetable has been agreed.

The company had said early last month that Oyu Tolgoi started shipping copper concentrate to customers from its copper and gold mine in Mongolia. The company had also said that all permits for exporting copper concentrate were in place.

Meanwhile, Bloomberg TV Mongolia reported that employees of Redpath Mongolia LLC, a contractor building the underground portion of the mine, were given termination notices following a decision by Oyu Tolgoi LLC's board of directors.

Rio Tinto controls Oyu Tolgoi through its unit Turquoise Hill Resources Ltd. (TRQ.TO, TRQ), which has a 66 percent stake in the mine. Earlier this month, Rio Tinto agreed to provide a $600 million bridge funding facility to Turquoise Hill to fund the development of Oyu Tolgoi.

RIO.AX is currently down 0.7 percent at A$61.53.