Jakob Stausholm needed a win. And he just got it with the growth project that’s been aRio announced on Tuesday that it has struck a new agreement with the Mongolian government that will allow Rio to proceed with a $US6.9 billion Rio Tinto’s chief executive Jakob Stausholm has had a win in Mongolia - finally.Make no mistake, Rio has had to give up plenty to win its deal with the Mongolian government, including waiving a $US2.
In a world where decarbonisation will push copper demand higher, but supply is very limited, that’s a great spot to be in. That team is led by Bold Baatar, chief executive of Rio’s copper division and a Mongolian citizen. While Stausholm says a big negotiation like this “has to be difficult and uncomfortable for both parties” Baatar’s ability to see issues from a Mongolian perspective proved invaluable.“That has opened our eyes to solutions that we might not have otherwise seen,” Stausholm says., just eight weeks after Stausholm took the reins.
Indeed, Rio will have another crack at reforecasting the remaining capital expenditure required on the underground mine – currently put at $US1.8 billion – in the coming months to take into account COVID-19 impacts, budget constraints and cost escalations and “the latest project execution risks”.
Would love to know the real story of how the Mongolians were ‘persuaded’…..
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