Rio Tinto (ASX, LON, NYSE:RIO) outlined on Friday how it plans to start production from the underground section of the vast Oyu Tolgoi copper-gold mine in Mongolia by October 2022.

The company said mining at the new section of the mine, set to become the world’s fourth-largest copper operation by 2030, would be done by sections — Panel 0, Panel 1 and Panel 2.

Production will start at Panel 0, Rio said, adding than Panels 1 and 2 will boost output to the proposed 95,000 tonnes of ore per day. The last two phases, however, are subject to further studies with initial recommendations expected by mid-2021.

The update follows Rio’s announcement on Wednesday, when it said the “definitive estimate” budget for the expansion would be $6.75 billion ($9 billion). This meant the project cost went up by $1.45 billion.

The company, which on Thursday named finance head Jakob Stausholm as its next chief executive, also said this week that sustainable first production would be achieved in October 2022. This is almost 22 months later than originally expected, when the project was launched in 2015.

The news came more than two years after the company first said the project was not moving according to plan because of weaker than expected geology and project management issues.

The announcement failed to provide straightforward information on its dealings with the Mongolian government. It also lacked clarity around the ongoing legal spat with its subsidiary Turquoise Hill (TSX, NYSE: TRQ), which launched in November arbitration proceedings against the mining giant to get clarity on the terms of its financing.

Rio is at odds with Turquoise Hill on how to cover a $3 billion funding gap. It wants to use a mixture of debt, equity and reprofiling of loans, while the Canadian miner favours a package that does not include a sale of new shares.

Minority investors in Turquoise Hill, including US hedge fund Pentwater Capital, oppose Rio’s attempts to force the Vancouver-based miner to conduct an equity raise.

They claim there are “much cheaper and more advantageous financing options” available to the company, such as streaming and bond financing.

They also worry about Rio growing its stake in Turquoise Hill through such an equity raising. Investors based this argument on the expectation that Rio would underwrite any shortfall created by minority Turquoise Hill shareholders who do not participate in the raising.

Mongolia’s reaction

Erdenes Oyu Tolgoi LLC, the Mongolian state-owned company that owns a third of the mine, reacted to the new timeline and budget by saying that Rio had not delivered on its 2015 promises.

“While we continue to review, at a preliminary level, due to the significant increases in development and sustaining capital as well as operating costs which are further exacerbated by the schedule delays, it appears that the economics of the project expected to be delivered to direct equity holders have diminished substantially,” Erdenes said in a statement.

Erdenes’ interest in Oyu Tolgoi is technically held through a 34% in a Mongolian company called Oyu Tolgoi LLC. The remaining stake belongs to Canada’s Turquoise Hill Resources (TSX, NYSE: TRQ), which is 50.79% owned by Rio.

”This is of great concern to us and further indicates that the management team of Oyu Tolgoi LLC delivered negative financial value to its shareholders over the last 5 years,” Erdenes said.

Mongolia requested in November an independent review of the cost blowout and delays at the project, with results expected in early 2021.

A tax dispute between the state and the various foreign investors in Oyu Tolgoi, including Rio Tinto, is currently waiting for a United Nations arbitration decision.

The government has complained about overruns in the past. A group of legislators recommended last year a review of the 2009 deal that launched construction of the mine. It also advised revoking a 2015 agreement allowing for the now ongoing underground expansion.

The parliament ended up approving a resolution in December 2019, which reconfirmed the validity of all the Oyu Tolgoi mine-related agreements. The decision brought an 18-month-long review to a close.

Rio has repeatedly said the underground expansion is its most important growth project. Once completed, Oyu Tolgoi will churn out 480,000 tonnes of copper a year from 2028 to 2036.

The head of Europe's aviation safety agency, EASA, has told the BBC he is "certain" Boeing's 737 Max is now safe to fly.

Executive Director Patrick Ky said his organisation had "left no stone unturned" in its review of the aircraft and its analysis of design changes made by the manufacturer.

The plane was grounded in March 2019.

That was after it was involved in two catastrophic accidents, in which a total of 346 people died.

It has already been cleared to resume flights in the US and Brazil. EASA expects to give permission for it to return to service in Europe in mid-January.

The plane's first accident occurred in October 2018, when a Lion Air jet came down in the sea off Indonesia.

New software

The second involved an Ethiopian Airlines version that crashed shortly after takeoff from Addis Ababa, just four months later.

Both have been attributed to flawed flight control software, which became active at the wrong time and prompted the aircraft to go into a catastrophic dive.

Since the Ethiopian crash, EASA has been carrying out a root-and-branch review of the 737 Max's design, independently from a similar process undertaken by the US regulator, the Federal Aviation Administration (FAA).

The review, says Mr Ky, went well beyond the immediate causes of the two accidents and the modifications proposed by Boeing.

"We went further and reviewed all the flight controls, all the machinery of the aircraft", he explains.

The aim, he says, was to look at anything which could cause a critical failure.

In order to return to service, existing planes will now have to be equipped with new computer software, as well as undergoing changes to their wiring and cockpit instrumentation.

'Confident' of safety

Pilots will need to undergo mandatory training, and each plane will have to undergo a test flight to ensure the changes have been carried out correctly.

US regulators have set out similar conditions.

As a result, Mr Ky insists, "We are very confident that it is now a very safe aircraft."

Most of the initial safety certification work on the 737 Max was carried out by the FAA, and simply endorsed by EASA under the terms of a long-standing international agreement.

But with the FAA now facing intense criticism for allowing an apparently flawed aircraft into service, Mr Ky says in future, things will be done differently.

"What is certain is that there were lessons learned from this, which will trigger new actions from our side", he explains.

In particular, where EASA is not the primary authority carrying out safety work, it will examine other people's decisions much more closely.

"We will perform our own safety assessment, which is going to be much more comprehensive than it used to be", he says.

But have regulators lost credibility and public confidence since the disasters?

"I hope not", says Mr Ky. "I think we have made a lot of progress in assessing what went wrong and what can be made better

"I hope the public trusts in us when we say we think, we are certain, that the aircraft is safe to fly".

Ulaanbaatar /MONTSAME/. It has become possible to treat stones in the kidney and urinary tract using laser treatment in Mongolia. At the initiation of Rotary Club of Khuree, laser equipment worth USD 227.8 thousand has been presented to the Urology and Andrology Department of the State Central First Hospital on December 17.

The Urology and Andrology Department is a crucial unit that offers its services on the national level. Some 3,000 patients are treated at the department annually, with about 800 surgeries.

During the launching ceremony for the laser treatment, Minister of Health T.Munkhsaikhan said, “The Urology and Andrology Department of the State Central First Hospital is a department that offers its services to many patients. Thus, I must express my gratitude to the Rotary Club of Khuree for creating the opportunity for the hospital to provide the required health care assistance and services for citizens. The Government of Mongolia and the Ministry of Health are working towards the objective of improving the health care services provided for citizens, including the introduction of new diagnosis and treatment services that are not offered in Mongolia. In the future, we aim to introduce the laser treatment to other central hospitals as well as in rural areas of the country.”

Project initiator, former president of the Rotary Club of Khuree D.Tuul said, “The Rotary Club has successfully implemented various projects in the health care sector. In the past 10 years, many projects have been implemented nationwide, such as the projects on the diagnosis of skin diseases with the use of smartphone application and the introduction of surgical laser equipment at the Ear, Nose, and Throat Department of the National Center for Maternal and Child Health.”

Poland will reopen its embassy in the Mongolian capital Ulaanbaatar in January 2021, the Polish Foreign Minister Zbigniew Rau announced on Thursday. Mr Rau said the decision was an important step in tightening relations between the two countries.

Also on Thursday, the Mongolian ambassador to Poland, H.E.Dorj Barkhas, was informed about the reopening of the Ulaanbaatar embassy at a meeting with Polish Deputy Foreign Minister Marcin Przydacz, Foreign Service Head Andrzej Papierz and Polish Ambassador to Mongolia, H.E. Krzysztof Bojko.

The Polish embassy in Ulaanbaatar was closed in 2009.

Ulaanbaatar /MONTSAME/. At the regular press briefing of the Ministry of Health today on December 20, it was reported that 8 new cases were detected in Mongolia after testing 8,416 people nationwide within the past 24 hours.

Of the eight new cases, six were recorded in Ulaanbaatar city and two were recorded from 2 citizens that arrived on a charter flight en route Frankfurt-Ulaanbaatar.

As of today, the number of confirmed cases has reached 961, with 509 recoveries.

A US panel of experts has voted to recommend the emergency approval of a second coronavirus vaccine.

The Food and Drug Administration (FDA) is expected to follow the recommendation, which means the Moderna vaccine could start being administered in the US as early as next week.

The vote came days after the country began its rollout of the Pfizer-BioNTech jab.

The US has recorded more Covid-19 cases and deaths than any other country.

Earlier this week, its coronavirus death toll passed 300,000.

The advisory panel on Thursday voted 20-0 with one abstention that the benefits of the Moderna vaccine outweigh the risks for those aged 18 and over. The same committee last week backed the Pfizer/BioNTech vaccine, leading to its authorisation for emergency use the following day.

The vote came after regulators reported earlier this week that the Moderna vaccine was safe and 94% effective.

The US has agreed to purchase 200m doses, and 6m could be ready to ship as soon as the vaccine gets FDA approval.

How does it differ from the Pfizer jab?

The Moderna vaccine requires temperatures of around -20C for shipping - similar to a normal freezer.

The Pfizer jab requires temperatures closer to -75C, making transport logistics much more difficult.

Like the Pfizer jab, the Moderna vaccine also requires a second booster shot. Moderna's second injection comes 28 days after the first.

The company is based in Cambridge, Massachusetts, and has said that if approved, the "vast majority" of its vaccine would be manufactured there.

Pfizer's drug is being manufactured in several countries, including Germany and Belgium.

Which other countries have ordered the Moderna vaccine?

In Canada, the government plans to get two million Moderna doses by March - part of a total 56m doses.

The UK has already pre-ordered 7m doses of the Moderna vaccine.

The European Union last month announced a contract to purchase of 80m doses - with an option to purchase up to 80m more - once the vaccine is deemed safe and effective.

Japan has signed up for 50m Moderna doses, South Korea for 20m, and Switzerland has ordered 7.5m, according to data compiled by the Duke University Global Health Innovation Center.

On December 14, 2020, the meeting of the External Advisory Committee of the “Switch Off Air Pollution” project was successfully organized online. The meeting was attended by Ambassador Extraordinary and Plenipotentiary of the European Union to Mongolia, Mr. Traian Hristea and Ambassador Extraordinary and Plenipotentiary of France to Mongolia, Mr. Philippe Merlin.

The project, which works to create a quality insulation market in Ulaanbaatar, aims to reduce air pollution by CO2 equivalent of 3.000 tons and reduce heat loss from ger area households by at least 15% as part of efforts to reduce air pollution in the ger area. This is the second meeting of the External Advisory Committee of the Project and this time, the Delegation of the European Union to Mongolia, the French Embassy, ​​the Ministry of Construction and Urban Development, the Ulaanbaatar City Governor’s Office, Xac bank, Mongolian Sustainable Finance Association, UNICEF, GIZ, World Vision, the World Bank’s Ulaanbaatar Clean Air and Additional Financing Project, Mongolian Women’s Foundation, Project Implementing Partners, project brigades and suppliers, and insulated households participated and discussed about the project results so far, future plan and its potential scale-up.

Opening the meeting, Ambassador of the European Union to Mongolia, Mr. Traian Hristea highlighted that “The fact that the Technical procedures of the EU funded project based on the European standards included in the Mongolia’s Construction Norms and Regulations is a major achievement.”

The French Ambassador to Mongolia, Mr. Philippe Merlin, stated that his visits to the beneficiaries of the project had been an opportunity to witness the significance of this project. He underlined his will to pursue the cooperation between France and GERES.

The activities of the External Advisory Committee of the “Switch Off Air Pollution” project is to provide support, guidance and oversight of progress advice, ensure delivery of the project outputs and the achievement of project outcomes; to deliver collective and professional advice and inputs on the project delivering products; to consult identifying key stakeholders and national policy makers in the decision-making process, who can then be engaged in advocacy towards systemic changes enabling better access to promoted materials and EE measures for potential customers, MSMEs, and suppliers.

During the meeting, leading partner, Geres updated about milestones the project has reached in 2020, such as: Insulation market creation in Ulaanbaatar, its Technical Assessment being approved in the Building codes and norms and so forth. COVID-19 impact report that was carried out by the project was introduced as well as the future planning and the starting of a scale-up study. One of the main topics that attracted the participants was the results of the Mid-Evaluation result highlighting the success of the project in terms of its technical procedures as well as the business model set-up.

The project is forming a market mechanism with a demand and supply chain. It does not only benefit the public, but it also aims to guarantee fair and attractive revenue to all the actors involved to ensure sustainability. Based on the needs and financial availability of the customers, the project offers different insulation options. If insulated fully by the project, the house can be 70% energy efficient decreasing heat loss in the house by the same amount. The engineering behind this innovative service began with an well-structured baseline study to understand the market incentive and continuous research and adaptation based on arising needs.

About Switch Off Air Pollution:

Co-financed by the European Union under the Switch Asia programme, with additional support from Abbe Pierre Foundation, Czech Development Agency and the French Development Agency; the Switch Off Air Pollution project is being implemented by Geres Mongolia, in collaboration with Building Energy Efficiency Center of the Mongolian University of Science and Technology, Mongolian National Construction Association and People in Need INGO during the 2018-2021 period.

Project website - www.dulaalga.mn

About Geres Mongolia:

Geres is an international NGO with expertise in energy and development, with over 40 years of experience in Europe, Africa, and Asia improving living condition

Chinese Foreign Minister Wang Yi called his Mongolian counterpart N. Enkhtaivan this week to tell him that China wants to swiftly reopen border crossings with Mongolia following weeks of gridlock.

The call suggests China wants better access to Mongolian coal as a ban on Australian imports takes effect.

Mongolia’s coal exports to China rose dramatically in September after China verbally told its producers to stop buying Australian coal, but nosedived again in November after a local outbreak of Covid-19.

Truck drivers shuttling coal over the border crossing at Gashuunsukhait had to take one Covid-19 test on either side, causing huge delays - videos posted to social media showed long lines of trucks and crowds milling around as sources indicated that up to 3000 trucks were stuck.

On November 23 only 211 trucks crossed the border (down from thousands per day months before), and on November 25, less than 20 trucks crossed.

According to Chinese state media, Yi said that “China is ready to discuss [the] expeditious resumption of normal personnel and cargo flows at border crossings with Mongolia while ensuring good prevention and control of COVID-19.”

Wang Yi also said China wants to ‘speed up’ the resumption of work on ‘key projects’. It is unclear what projects he was referring to.

Whilst coal was not explicitly mentioned in Chinese media reports on the phone call, Enkhtaivan released a statement mentioning the ‘sustainable trade in mining products.’

In addition, Wang Yi’s timing is interesting: his phone call to Enkhtaivan came around the same time as the state-owned Global Times confirmed that Chinese power plants are free to import coal from several countries ‘except Australia’.

China unofficially banned Australian coal months ago, but the Global Times article suggests that the ban is now official. The move prompted Australia to refer China to the World Trade Organisation, as it stands to lose up to $A14 billion per year.

The Times’ article quoted Wang Yongzhong, an energy director at the Chinese Academy of Social Sciences, as saying that China will source coal from Mongolia, Russia and Indonesia as alternatives.

However, there are indications that Indonesia may not be able to make up the shortfall - Mongolia actually became China’s top supplier of coal in October after Indonesian imports fell dramatically (with Russian supplies in second place).

In addition, China’s agreement to buy more coal from Indonesia has been criticised for being ‘light on details’ and ‘a long way for making up for lost volumes from Australia.’

Ulaanbaatar /MONTSAME/. The Hu has earned No.3 on Billboard’s World Digital Song Sales chart this week with their new song, ‘Sad But True’. The song is a Mongolian language cover of Metallica’s song, ‘Sad But True’, in their own style.

Previously, the band has also led the World Albums chart by Billboard with their debut album, ‘Gereg’, in September 2019. It was the first time for a Mongolian band to lead the chart with a Mongolian album.