Rio secures $US4.4b to expand Oyu Tolgoi

Mining giant Rio Tinto has secured $US4.4bn to expand its copper and gold mine in Mongolia. (AAP)

Mining giant Rio Tinto has secured $US4.4 billion from 20 institutions to finance the expansion of its massive Oyu Tolgoi mine after a four year process.

Mining giant Rio Tinto has secured $US4.4 billion ($A6.07 billion) to expand its Oyu Tolgoi copper and gold mine in Mongolia.

Rio's head of copper and coal Jean-Sebastien Jacques said 20 financial institutions had agreed to finance the second phase of the $US6 billion project which had been more than four years in the making.

"Oyu Tolgoi is one of the world's best copper and gold projects and we are pretty bullish about the prospects of copper," Mr Jacques told reporters in a teleconference on Tuesday.

He said around 80 per cent of the value of the project was contained in the underground mine which would take five to seven years to build.

Rio Tinto expects the copper market to recover in around three to four years as it banks on Oyu Tolgoi becoming an important global source of supply.

"Long-term copper fundamentals remain strong," Mr Jacques said.

Fifteen commercial banks and five international export agencies representing the governments of Australia, the United States and Canada are investing in the underground project.

Mr Jacques added that Rio had initially targeted $US4.2 billion in financing, but that figures was increased because of "a strong appetite".

The company predicts it will take around three months to finalise its cost estimate for the project and the partners, including the Mongolian Government and Rio subsidiary Turquoise Hill, were all committed to making it work.

"We are all on the same boat and rowing in the same direction," Mr Jacques said.

Once all of the necessary permits to develop the mine have been completed, Rio and its partners are expected to sign off on the project in the first half of 2016.

In 2013 Rio's suspended the $US5 billion underground expansion of the Oyu Tolgoi after the Mongolian government - a 34 per cent partner in the project - refused to approve Rio's proposed financing plans with banks for the expansion, amid complaints about cost blow-outs.

Source AAP

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