Bloomberg reported that Rio Tinto Group, the world’s second biggest mining company rejected a renewed request by Mongolia to renegotiate a 2009 deal over USD 6.2 billion mines that Rio plans to start next year.

The Minister of Mining sent a letter requesting amendment of the investment agreement that became effective in March 2010, Vancouver based Turquoise Hill Resources Limited.

Mr Illtud Harri Rio spokesman said that “Rio Tinto is fully aligned with Turquoise Hill’s position. London based Rio owns 51% of Turquoise Hill formerly Ivanhoe Mines Limited.”

Mongolia’s government said last year it wanted to boost its stake in Oyu Tolgoi to 50% from 34% as well as make changes to royalty payments. Turquoise Hill owns 66% of the project in southern Mongolia with first output expected in the H1 of 2013.

Mr Glyn Lawcock head of resources research for UBS AG in Sydney said that “This is a pretty standard agreement for developing countries whereby governments get a free carry. Companies are entitled to earn their share of the capital back before the government then gets its take.”

Source - Bloomberg.net

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