MONTREAL, Feb. 20, 2020 /CNW/ - Turquoise Hill Resources
today announced that Oyu Tolgoi LLC (Oyu Tolgoi) has been unable to
reach a resolution of its previously-announced dispute with the
Mongolian Tax Authority (MTA) with respect to the MTA's tax
assessment, and will be proceeding with the initiation of a formal
international arbitration proceeding in accordance with the dispute
resolution provisions within Chapter 14 of the Oyu Tolgoi
Investment Agreement (Investment Agreement) entered into with the
Government of Mongolia in 2009 and
Chapter 8 of the Oyu Tolgoi Underground Mine Development and
Financing Plan entered into with the Government of Mongolia in 2015. The dispute resolution
provisions call for an UNCITRAL arbitration seated in London before a panel of three
arbitrators.
On January 16, 2018, Turquoise
Hill announced that Oyu Tolgoi had received and was evaluating a
tax assessment for approximately $155
million from the MTA relating to an audit on taxes imposed
and paid by Oyu Tolgoi between 2013 and 2015. In January 2018, Oyu Tolgoi paid an amount of
$4.8 million to settle unpaid taxes,
fines and penalties for accepted items.
Turquoise Hill remains of the opinion that Oyu Tolgoi has paid
all taxes and charges required to be paid under the Investment
Agreement, the Amended and Restated Shareholders' Agreement, the
Underground Mine Development and Financing Plan and Mongolian
law.
By agreeing to resolve the dispute under the UNCITRAL
Arbitration Rules, both parties have agreed that the arbitral award
shall be final and binding on the parties and that the parties
shall carry out the award without delay.
Forward-Looking Statements
Certain statements made herein, including statements relating to
matters that are not historical facts and statements of the
Company's beliefs, intentions and expectations about developments,
results and events which will or may occur in the future,
constitute "forward-looking information" within the meaning of
applicable Canadian securities legislation and "forward-looking
statements" within the meaning of the "safe harbor" provisions of
the United States Private Securities Litigation Reform Act of 1995.
Forward-looking statements and information relate to future events
or future performance, reflect current expectations or beliefs
regarding future events and are typically identified by words such
as "anticipate", "could", "should", "expect", "seek", "may",
"intend", "likely", "plan", "estimate", "will", "believe" and
similar expressions suggesting future outcomes or statements
regarding an outlook. These include, but are not limited to,
statements and information regarding the construction and timing of
construction and operation of the Tavan Tolgoi Power Plant, the
expectations set out in the Tavan Tolgoi Power Plant Feasibility
Study, anticipated sources of power for the Oyu Tolgoi mine and
other statements that are not historical facts.
Forward-looking statements and information are made based upon
certain assumptions and other important factors that, if untrue,
could cause the actual results, performance or achievements of the
Company to be materially different from future results, performance
or achievements expressed or implied by such statements or
information. There can be no assurance that such statements or
information will prove to be accurate. Such statements and
information are based on numerous assumptions regarding the
availability and timing of required governmental and other
approvals for the construction of the Tavan Tolgoi Power Plant,
present and future business strategies, local and global economic
conditions, and the environment in which the Company will operate
in the future, including the price of copper, gold and silver and
projected gold, copper and silver grades, anticipated capital and
operating costs, anticipated future production and cash flows, the
status of the Company's relationship and interaction with the
Government of Mongolia on the
continued operation, development of the Oyu Tolgoi mine and Oyu
Tolgoi LLC internal governance. Certain important factors that
could cause actual results, performance or achievements to differ
materially from those in the forward-looking statements and
information include, among others, the risk that certain commercial
uncertainties relating to the Tavan Tolgoi Power Plant may not be
resolved, including with the Government of Mongolia, with respect to land rights,
funding, back-up power, accession of Oyu Tolgoi to the TTPP
Investment Agreement and the extension of the existing Electricity
Purchase and Sale agreement between IMPC and NPTG; copper; gold and
silver price volatility; discrepancies between actual and estimated
production, mineral reserves and resources and metallurgical
recoveries; development plans for processing resources; the outcome
of the definitive estimate review; matters relating to proposed
exploration or expansion; mining operational and development risks,
including geotechnical risks and ground conditions; litigation
risks; regulatory restrictions (including environmental regulatory
restrictions and liability); Oyu Tolgoi LLC's ability to deliver a
domestic power source for the Oyu Tolgoi project within the
required contractual time frame; communications with local
stakeholders and community relations; activities, actions or
assessments, including tax assessments, by governmental
authorities; events or circumstances (including strikes, blockages
or similar events outside of the Company's control) that may affect
the Company's ability to deliver its products in a timely manner;
currency fluctuations; the speculative nature of mineral
exploration; the global economic climate; dilution; share price
volatility; competition; loss of key employees; cyber security
incidents; additional funding requirements, including in respect of
the development or construction of a long-term domestic power
supply for the Oyu Tolgoi project; capital and operating costs,
including with respect to the development of additional deposits
and processing facilities; and defective title to mineral
claims or property. Although the Company has attempted to identify
important factors that could cause actual actions, events or
results to differ materially from those described in
forward-looking statements and information, there may be other
factors that cause actions, events or results not to be as
anticipated, estimated or intended. All such forward-looking
statements and information are based on certain assumptions and
analyses made by the Company's management in light of their
experience and perception of historical trends, current conditions
and expected future developments, as well as other factors
management believes are appropriate in the circumstances. These
statements, however, are subject to a variety of risks and
uncertainties and other factors that could cause actual events or
results to differ materially from those projected in the
forward-looking statements or information.
Readers are cautioned not to place undue reliance on
forward-looking information or statements. By their nature,
forward-looking statements involve numerous assumptions, inherent
risks and uncertainties, both general and specific, which
contribute to the possibility that the predicted outcomes will not
occur. Events or circumstances could cause the Company's actual
results to differ materially from those estimated or projected and
expressed in, or implied by, these forward-looking statements.
Important factors that could cause actual results to differ from
these forward-looking statements are included in the "Risk Factors"
section in the Company's Annual Information Form dated as of
March 13, 2019 in respect of the year
ended December 31, 2018 (the "AIF")
as supplemented by our Management's Discussion and Analysis of
Financial Condition and Results of Operations for the three and
nine months ended September 30, 2019
(MD&A).
Readers are further cautioned that the list of factors
enumerated in the "Risk Factors" section of the AIF and in the
MD&A that may affect future results is not exhaustive. When
relying on the Company's forward-looking statements and information
to make decisions with respect to the Company, investors and others
should carefully consider the foregoing factors and other
uncertainties and potential events.
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SOURCE TURQUOISE HILL RESOURCES LTD