Oyu Tolgoi Feasibility Study: $7.36B Capex
Rio Tinto's Oyu Tolgoi in Mongolia, South Gobi region has a Feasibility Study outlining initial capital of $7.36B.
Rio Tinto's Oyu Tolgoi has reported Feasibility Study results for the copper (with gold and silver project in Mongolia, South Gobi region. It reflects Rio Tinto's (RIO) latest disclosed economics for the asset.
Economics. Initial capital expenditure is estimated at $7.36B, with life-of-mine sustaining capital of $5.00B. Economics are based on Mineral Resource valuations based on consensus prices: US c 320.30/lb copper, US$1,479.82/oz gold, US$19.23/oz silver, US$9.29/lb molybdenum. Mineral Reserve valuations based on consensus prices: US c 350.80/lb copper, US$1,496.75/oz gold, US$20.43/oz silver..
Production and mine plan. The project envisions an open-pit & underground operation.
Resources and ownership. The company holds a 66% interest in the project. Royalties and streams: Rio Tinto holds a 66% interest in Oyu Tolgoi LLC following acquisition of Turquoise Hill Resources. Remaining 34% held by the Government of Mongolia through Erdenes Oyu Tolgoi LLC. Oyu Tolgoi's legal title to Shivee Tolgoi and Javkhlant licences subject to equity participation and earn-in agreement between Entrée LLC and Oyu Tolgoi. Investment Agreement dated 6 October 2009 between Government of Mongolia, Ivanhoe Mines Mongolia LLC (now Oyu Tolgoi LLC), Ivanhoe Mines Ltd (now Turquoise Hill Resources Ltd), and Rio Tinto..
These figures are extracted from Rio Tinto's technical disclosures and reflect the most recent Feasibility Study on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Measured & Indicated | — | — | 5.4 Mt contained copper, 5.9 Moz contained gold |
| Inferred | — | — | 13.6 Mt (30 billion pounds) contained copper, 20.4 Moz contained gold |
Our Analysis
- Initial capex
- $7.36B
costlier than 100% of 376 projects we track
- Study price assumption
- Mineral Resource valuations based on consensus prices: US c 320.30/lb copper, US$1,479.82/oz gold, US$19.23/oz silver, US$9.29/lb molybdenum. Mineral Reserve valuations based on consensus prices: US c 350.80/lb copper, US$1,496.75/oz gold, US$20.43/oz silver.
- Spot copper today
- $6.52/lb
On a league table of 376 tracked projects, this is not an outlier by any metric that usually grabs attention. What stands out instead is the sheer scale of the developer relative to the build. The initial capex of $7.36B is a serious number, but against a US$158.04B market cap, it is a rounding error. That is the sharpest funding-risk signal available here: a large-cap with 26 projects in its portfolio can absorb this construction without the existential dilution or financing drama that would dominate a junior's story. For an investor, the rank question is less "will this get built?" and more "does this move the needle for a company this size?"
The feasibility-level study is the build-ready estimate, carrying a plus or minus 15% band, so the numbers deserve weight. The project sits in the South Gobi region of Mongolia, a jurisdiction that has historically demanded patience on permitting and infrastructure, though the copper-gold-silver endowment is well established. The study's price deck is conservative relative to the current copper spot of $6.52/lb, with mineral resource valuations using US c 320.30/lb copper and reserve valuations at US c 350.80/lb. That gap is not a red flag; it is a cushion. The returns are computed on prices below today's market, which means the downside case is already partially stress-tested.
The constraint that matters most is not capital, jurisdiction, or commodity price. It is the company's own portfolio logic. With 26 projects tracked, this is one among many, and the question is whether management prioritizes it in the queue. The two-sided read on any valuation gap is that the market may be skeptical about sequencing, not viability. The single decision that decides whether this project works is whether the company's capital allocation committee slots a $7.36B build ahead of its other options, and that is a judgment call no study can answer.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.