About 1,700 employees might be made leave OT project

Ulaanbaatar /MONTSAME/ The board of directors of the Oyu Tolgoi LLC has decided to fire its 1,700 employees due to a depression at the underground mine caused by several reasons. Rio Tinto Group, the biggest investor of the OT project, has augmented the size of initial investment by over two billion US dollars, reaching USD 6.7 billion. The first announcement of the initial investment was USD 4.4 billion. This situation has been defined by Mongolia’s government as "not understandable", and it said it needs to discuss the matter by parliament to see back the OT investment treaty. It led to a wrangle between the government and the investor. Rio Tinto reported Thursday that it will lay off up to 1,700 staff at OT copper mine in Mongolia after it halted a more than US$5 billion expansion. According to Ts.Ganzorig, a spokesman of the OT LLC, the OT investors decided at their meeting on Monday to temporarily stop the underground mine until resolving the financial matter for the project. "Some media say that the OT project is about to fire 1,700 employees. This is not true, but some parts of employees will be fired. They will be provided with other job places by a plan we have worked out," Ganzorig said. However, the number of employees to be fired is not clear, and no employee has been fired yet. By the labour law, those fired employees shall receive the compensations, he said. "Miners who worked at OT underground are well skilled. These people have been trained by the OT project with big amount of capital and taking long times, so if the side of investors resolves the issues, it will resume the employment," Ganzorig said. "This is a difficult time for everyone at Oyu Tolgoi, but it is especially difficult for those who work on the underground mine," a Rio spokesman said in a statement. "There will be up to 1,700 redundancies for our employees and contractors. The process is taking place in accordance with domestic and international labour laws and regulations." "While this is an upsetting time for everybody working at Oyu Tolgoi, we would like to emphasize that we are still an operating business," the spokesman said. The mine began exporting concentrate to international customers last month, and the spokesman said infrastructure projects outside the mine, such as the construction of a road to Tsagaankhad, would continue. "The shareholders are fully committed to resolving the issues so the underground development can resume, and, in the meantime, we remain focused on ensuring the continued safety and well-being of our workforce," he added. According to Rio OT employs 10,888 people, 90 percent of whom are Mongolians. The mine, which is expected to produce an average of 430,000 tons of copper and 425,000 ounces of gold annually for 20 years, is set to be one of the biggest drivers of Mongolia's economy this decade, generating up to one-third of government revenue by 2019, according to previous estimates