(Adds stock price, analyst comment, production data, mine
By Susan Taylor
TORONTO Dec 2 Turquoise Hill Resources Ltd
said on Friday it has suspended concentrate shipments
from its giant copper-gold Oyu Tolgoi mine in Mongolia across
the Chinese border, blaming problems with a crossing route.
Vancouver-based Turquoise Hill said it suspended shipments
effective Thursday, after a new requirement at the
Chinese-Mongolian border to use one joint coal and concentrate
route created "unreasonably" long waits to cross the border
along with safety and security concerns.
The company, whose shares fell 2.5 percent to C$4.34 in
early trade on Friday, said in a statement it was unclear how
long the suspension would continue and it was trying to clarify
the matter with Mongolian and Chinese authorities.
Turquoise Hill was not immediately available for comment.
In 2016, the south Gobi desert mine is forecast to produce
175,000 to 195,000 tonnes of copper in concentrates and 255,000
to 285,000 ounces of gold in concentrates, the company said in
RBC Capital Markets analyst Fraser Phillips said in a note
to clients that the suspension was a negative.
It comes one day after new fees were levied on commodity
shipments between Mongolia and China, following a diplomatic row
sparked by last week's visit of Tibetan spiritual leader, the
Dalai Lama, to Ulaanbaatar.
The Dalai Lama is cherished as a spiritual leader in
predominantly Buddhist Mongolia, but China regards him as a
dangerous separatist and warned the visit could damage bilateral
Rio Tinto Plc's majority-owned Turquoise Hill has a
66 percent stake in the mine, with the Mongolian government
holding the remainder. Rio Tinto operates Oyu Tolgoi.
In June, Rio gave the go-ahead for a $5.3 billion
underground expansion of the mine, with first production
expected in 2020. When fully ramped in 2027, copper output is
forecast at more than 500,000 tonnes annually.
(Additional reporting by Reporting by Vishaka George in
Bengaluru; Editing by Savio D'Souza and Jeffrey Benkoe)