Case story

  • Canada

OECD NCP Canada - OT Watch vs. Rio Tinto International Holdings Ltd

2010

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Case Status

The complaint alleges the companies’ Technical and Economic Feasibility Study that was accepted by Mongolia’s Technical Council of Minerals Experts in March and implemented in April 2010 does not demonstrate the availability of sufficient water resources to carry out the project. It also raises issues concerning the longterm commitment of Ivanhoe Mines to the region and proposed royalty transfers among owners of the mining license.

Relevant OECD Guidelines: Part 1 Chapter II Paragraph II.1; Part 1 Chapter V Paragraph V.3


Story

UK-based Rio Tinto International Holdings owns 22.4% of Canada-based Ivanhoe Mines Ltd., which is planning to mine gold and copper at the Oyu Tolgoi open-pit mine in the South Gobi region of Mongolia. Slated to begin production in 2013, it will be the largest mine in the country’s history. On March 25th 2010, a revised Technical and Economic Feasibility Study (TEFS) was accepted by Mongolia’s Technical Council of Minerals Experts and implemented on April 6, 2010.

According to the complaint by Mongolia-based Oyu Tolgoi (OT) Watch and 5 other NGOs, Ivanhoe’s TEFS does not demonstrate the availability of sufficient water resources to carry out the project.

In addition to the environmental concerns, there are also issues surrounding the long-term commitment of Ivanhoe to the region, and issues surrounding proposed royalty transfers among owners of the mining license.

The complaint was filed at the UK and Canadian NCP, with an additional complaint presented to the US NCP because Rio Tinto is listed on the New York Stock Exchange.


Outcome

After receiving the complaint, the UK NCP transferred the case to the Canadian NCP because Ivanhoe is registered in Canada. The UK NCP however, maintains that it will assist as necessary with engaging Rio Tinto in the specific instance process. The US NCP acknowledged receipt of the complaint and informed the Complainants that it would forward the case to the Australian, UK and Canadian NCPs given the country of origin of the companies involved, and stand ready to assist those NCPs in the handling of the case.

The Canadian NCP is conducting an initial assessment and has forwarded the complaint to Ivanhoe Mines and Rio Tinto, both of which have responded in writing.

Other NCPs Involved: USA, UK

Contributor(s): This article was modified by Kyle (7), Ejfturnbull (1).