Shearman And Sterling

News December 16, 2015

Shearman & Sterling Advises on Mega Oyu Tolgoi Mining Project in Mongolia

Shearman & Sterling represented Erdenes Oyu Tolgoi LLC, a Mongolian state-owned company, in the US$5.4 billion project financing for the massive Oyu Tolgoi mining project in Mongolia.

The firm advised the company on various matters relating to its role as a shareholder in the project financing.  In addition, the firm  analyzed the relevant project financing documents to ensure they comply with the “Oyu Tolgoi Underground Mine Development and Financing Plan” signed in Dubai in May 2005 between the Oyu Tolgoi shareholders and the Government of Mongolia.

Oyu Tolgoi is one of the world's largest copper-gold deposits based in the southern Gobi desert of Mongolia and is jointly owned by Erdenes Oyu Tolgoi LLC (34%) and Turquoise Hill Resources (66%, of which Rio Tinto owns 51%). Once fully operational, it is expected to account for approximately 40% of Mongolia's gross domestic product.

The financing ensures that the development of the underground mine will proceed quickly, and closing is expected to occur in early 2016.

The Shearman & Sterling team was led by partners Matthew Bersani (Hong Kong-Capital Markets) and Etienne Gelencsér (Tokyo-Project Development & Finance), with support from associate Crystal Chen (Hong Kong/ Shanghai-Project Development & Finance).