Turquoise Hill Resources Ltd. reported its financial results for Q2 2020, showcasing resilience amid COVID-19 challenges. Revenue fell by 27.4% to $278 million due to a 56.7% dip in gold production and a 6.9% drop in copper output. However, income improved to $72.3 million compared to a loss of $736.7 million in Q2 2019, aided by reduced operating costs and a decrease in capital expenditure. Gold production guidance for the year was raised to 155,000-180,000 ounces, reflecting operational adjustments. The company holds $1.5 billion in liquidity, sufficient to support operations through early 2022.
On July 24, 2020, Turquoise Hill Resources (TSX:TRQ) announced the results of its Annual Meeting of Shareholders. All seven management nominees were re-elected to the Board of Directors, with George Burns receiving 82.29% approval. The resolutions for KPMG LLP as auditor and the consolidation of common shares were approved. However, a proposal for minority shareholder director nominations was rejected, and Mr. Halbower's election was defeated with 64.61% voting against. The company aims to improve engagement with minority shareholders moving forward.
Turquoise Hill Resources will release its second quarter financial results on July 28, 2020, after market closure in North America. A conference call to discuss these results is scheduled for July 29, 2020, at 7:30 am EST. Investors and analysts can access the call via North America dial-in at +1 888 390 0546. The call will also be available as a live webcast on the company's website, with archived playback following the event.
Turquoise Hill Resources announced an increase in gold production guidance for 2020 to 155,000-180,000 ounces, up from 120,000-150,000 ounces, along with steady copper production targets of 140,000-170,000 tonnes. Cost guidance has improved, with C1 costs now estimated at $1.60-$2.00 per pound of copper. Despite challenges, including a 57% drop in gold production in Q2 2020 and impacts from COVID-19, the company reported $1.5 billion in liquidity, expected to cover operations into early 2022. Shareholder voting is encouraged at the upcoming AGM on July 24, 2020.
Turquoise Hill Resources has updated its Mineral Resources and Reserves following the Oyu Tolgoi Feasibility Study (OTFS20), which introduces a new block cave design for the Hugo North mine. This redesign has led to a decrease in the Mineral Reserves estimate due to structural pillars aimed to protect infrastructure. A substantial expansion capital cost of US$2.2 billion is anticipated, with total costs for the project ranging from US$1.3 to US$1.8 billion. The company noted ongoing COVID-19 impacts affecting operations. The NPV8 is projected at US$10 billion, maintaining a mine life of 31 years.
On June 28, 2020, Turquoise Hill Resources announced a significant agreement with the Government of Mongolia to prioritize the construction of a State Owned Power Plant (SOPP) for the Oyu Tolgoi mine. This project aims to ensure a reliable long-term power supply for both open pit operations and underground development. Key milestones include signing a Power Purchase Agreement by March 31, 2021, starting construction by July 1, 2021, and commissioning the SOPP within four years. This collaborative effort underscores the commitment of all parties to the mine's success.