MONTREAL, May 3, 2021 /PRNewswire/ - Turquoise Hill
Resources Ltd. ("Turquoise Hill" or the "Company") today
announced that the Government of Mongolia ("GOM") filed its statement of
defence together with a counterclaim ("GOM Defence and
Counterclaim") in relation to a previously-disclosed international
tax arbitration proceeding brought by Oyu Tolgoi LLC ("OT") against
the GOM in February 2020. Turquoise
Hill is not a party to that arbitration, but the Company
understands that the GOM Defence and Counterclaim includes a
request that the arbitral tribunal add both the Company and a
member of the Rio Tinto Group as parties to the tax arbitration.
The Company understands that the principal thrust of the GoM
Defence and Counterclaim is to seek the rejection of OT's tax
claims in their entirety. As part of the counterclaim, the GoM
makes assertions surrounding previously-reported allegations
of historical improper payments made to GOM officials and seeks
unquantified damages. Also, in the event OT's tax claims are
not dismissed in their entirety, GoM is seeking in the counterclaim
an alternative declaration that the 2009 Investment Agreement
("IA") is void.
Turquoise Hill denies the allegations relating to it in the GOM
Defence and Counterclaim and intends to oppose GOM's request that
it be added to the tax arbitration as and when that application is
formally served on Turquoise Hill. If nevertheless the
Company is added to the proceedings, Turquoise Hill will vigorously
defend itself against the counterclaim.
About Turquoise Hill Resources
Turquoise Hill is an international mining company focused on the
operation and continued development of the Oyu Tolgoi copper-gold
mine in Mongolia, which is the
Company's principal and only material mineral resource property.
Turquoise Hill's ownership of the Oyu Tolgoi mine is held through a
66% interest in Oyu Tolgoi LLC); Erdenes Oyu Tolgoi LLC, a
Mongolian state-owned entity, holds the remaining 34% interest.
Forward-looking statements and forward-looking
information
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: discussions with, and the
nature of the Company's relationship and interaction with, the
Government of Mongolia on the
continued operation and development of Oyu Tolgoi, including with
respect to the definitive estimate and the potential termination,
amendment or replacement of the IA or the Oyu Tolgoi Mine
Development and Financing Plan ("UDP"); the willingness and ability
of the parties to the IA or the UDP to amend or replace either such
agreement; the implementation and successful execution of the
funding plan that is the subject of the Heads of Agreement between
Turquoise Hill and Rio Tinto dated April 9,
2021 (the "HoA") and the amount of any additional future
funding gap to complete the Oyu Tolgoi Project as well as the
amount and potential sources of additional funding required
therefor, all as contemplated by the HoA; the expectations set out
in the 2020 Oyu Tolgoi Technical Report; the timing and amount of
future production and potential production delays; statements in
respect of the impacts of any delays on the Company's cash flows;
expected copper and gold grades; the merits of the class action
complaints filed against the Company in October 2020 and January
2021, respectively; the likelihood that the Company will be
added as a party to the international tax arbitration brought by OT
against the GOM and the merits of the GOM Defence and Counterclaim;
the timing of studies, announcements and analyses; status of
underground development; the mine design for Panel 0 of Hugo North
Lift 1 and the related cost and production schedule implications;
the re-design studies for Panels 1 and 2 of Hugo North Lift 1 and
the possible outcomes, content and timing thereof; expectations
regarding the possible recovery of ore in the two structural
pillars, to the north and south of Panel 0; the possible
progression of a state-owned power plant ("SOPP") and related
amendments to the Power Source Framework Agreement as well as
power purchase agreements; the timing of construction and
commissioning of the potential SOPP; sources of interim power; the
potential impact of COVID-19, including any restrictions imposed by
health or governmental authorities relating thereto on the
Company's business, operations and financial condition; capital and
operating cost estimates; mill and concentrator throughput; the
outcome of formal international arbitration proceedings;
anticipated business activities, planned expenditures, corporate
strategies, 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. 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 for
the year ended December 31, 2020
("AIF"), as supplemented by the "Risks and Uncertainties" section
of the Company's management's discussion and analysis for the
fourth quarter and year ended December 31,
2020 ("MD&A"). Readers are further cautioned that the
list of factors enumerated in the "Risk Factors" section of the AIF
and in the "Risks and Uncertainties" section of 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. Furthermore, the forward-looking statements
and information contained herein are made as of the date of this
document and the Company does not undertake any obligation to
update or to revise any of the included forward-looking statements
or information, whether as a result of new information, future
events or otherwise, except as required by applicable law. The
forward-looking statements and information contained herein are
expressly qualified by this cautionary statement.
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SOURCE TURQUOISE HILL RESOURCES LTD
