Cover Page
Cover Page | 12 Months Ended |
Dec. 31, 2021shares | |
Document Information [Line Items] | |
Document Type | 40-F |
Amendment Flag | false |
Document Period End Date | Dec. 31, 2021 |
Document Fiscal Year Focus | 2021 |
Document Fiscal Period Focus | FY |
Trading Symbol | TRQ |
Entity Registrant Name | TURQUOISE HILL RESOURCES LTD. |
Entity Central Index Key | 0001158041 |
Current Fiscal Year End Date | --12-31 |
Entity Current Reporting Status | Yes |
Entity Emerging Growth Company | false |
Entity Common Stock, Shares Outstanding | 201,231,446 |
Entity Interactive Data Current | Yes |
Entity File Number | 001-32403 |
Entity Incorporation, State or Country Code | B0 |
Entity Address, Address Line One | Suite 3680 – 1 Place Ville Marie |
Entity Address, Address Line Two | Montreal |
Entity Address, City or Town | Quebec |
Entity Address, Postal Zip Code | H3B 3P2 |
City Area Code | 514 |
Local Phone Number | 848-1567 |
Document Annual Report | true |
Annual Information Form | true |
Audited Annual Financial Statements | true |
Document Registration Statement | false |
Entity Address, Country | CA |
Title of 12(b) Security | Common Shares without par value |
Security Exchange Name | NYSE |
ICFR Auditor Attestation Flag | true |
Auditor Name | KPMG LLP |
Auditor Location | Vancouver, British Columbia, Canada |
Auditor Firm ID | 85 |
Business Contact [Member] | |
Document Information [Line Items] | |
Contact Personnel Name | CT Corporation System |
Entity Address, Address Line One | 28 Liberty St 42nd Floor |
Entity Address, City or Town | New York |
Entity Address, Postal Zip Code | 10005 |
City Area Code | 212 |
Local Phone Number | 894-8700 |
Entity Address, State or Province | NY |
Consolidated Statements of Inco
Consolidated Statements of Income - USD ($) shares in Thousands, $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Profit or loss [abstract] | ||
Revenue | $ 1,971,042 | $ 1,078,192 |
Cost of sales | (622,329) | (669,394) |
Gross margin | 1,348,713 | 408,798 |
Operating expenses | (275,487) | (202,271) |
Corporate administration expenses | (37,699) | (30,602) |
Other (expenses) income | (37,577) | 482 |
Income before finance items and taxes | 997,950 | 176,407 |
Finance items | ||
Finance income | 2,998 | 17,349 |
Finance costs | (8,036) | (5,510) |
Finance income (cost) | (5,038) | 11,839 |
Income from operations before taxes | 992,912 | 188,246 |
Income and other taxes | (311,792) | 306,396 |
Income for the year | 681,120 | 494,642 |
Attributable to owners of Turquoise Hill Resources Ltd. | 524,890 | 406,288 |
Attributable to owner of non-controlling interest | 156,230 | 88,354 |
Income for the year | $ 681,120 | $ 494,642 |
Basic and diluted earnings per share attributable to Turquoise Hill Resources Ltd. | $ 2.61 | $ 2.02 |
Basic weighted average number of shares outstanding (000's) | 201,231 | 201,231 |
Consolidated Statements of Comp
Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of comprehensive income [abstract] | ||
Income for the year | $ 681,120 | $ 494,642 |
Other comprehensive income: | ||
Changes in the fair value of marketable securities at FVOCI | 2,945 | 2,231 |
Other comprehensive income for the year | 2,945 | 2,231 |
Total comprehensive income for the year | 684,065 | 496,873 |
Attributable to owners of Turquoise Hill | 527,835 | 408,519 |
Attributable to owner of non-controlling interest | 156,230 | 88,354 |
Total comprehensive income for the year | $ 684,065 | $ 496,873 |
Consolidated Statements of Co_2
Consolidated Statements of Comprehensive Income (Parenthetical) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of comprehensive income [abstract] | ||
Tax charges and credits | $ 0 | $ 0 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flow - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Statement of cash flows [abstract] | ||
Cash generated from operating activities before interest and tax | $ 1,210,790 | $ 371,169 |
Interest received | 2,735 | 20,407 |
Interest paid | (276,392) | (316,778) |
Income and other taxes paid | (361,040) | (33,855) |
Net cash generated from operating activities | 576,093 | 40,943 |
Cash flows from investing activities | ||
Receivable from related party: amounts withdrawn | 0 | 511,284 |
Expenditures on property, plant and equipment | (996,917) | (1,080,516) |
Pre-production sales proceeds | 69,726 | 26,091 |
Purchase of other financial assets | (206) | (399) |
Purchase of put options | (29,907) | 0 |
Other investing cash flows | 63 | 1,106 |
Cash used in investing activities | (957,241) | (542,434) |
Cash flows from financing activities | ||
Repayment of project finance facility | (43,489) | (23,289) |
Payment of lease liability | (4,085) | (4,344) |
Cash used in financing activities | (47,574) | (27,633) |
Effects of exchange rates on cash and cash equivalents | (603) | 760 |
Net decrease in cash and cash equivalents | (429,325) | (528,364) |
Cash and cash equivalents - beginning of year | 1,123,621 | 1,651,985 |
Cash and cash equivalents - end of year | 694,296 | 1,123,621 |
Cash and cash equivalents as presented in the consolidated balance sheets | $ 694,296 | $ 1,123,621 |
Consolidated Statements of Bala
Consolidated Statements of Balance Sheets - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | |
Current assets | |||
Cash and cash equivalents | $ 694,296 | $ 1,123,621 | |
Inventories | 290,017 | 197,962 | |
Trade and other receivables | 16,119 | 60,012 | |
Prepaid expenses and other assets | 120,606 | 127,274 | |
Other financial assets | 109 | 0 | |
Current assets | 1,121,147 | 1,508,869 | |
Non-current assets | |||
Property, plant and equipment | 11,974,480 | 10,927,512 | |
Inventories | 60,711 | 37,557 | |
Prepaid expenses | 348,671 | 0 | |
Deferred income tax assets | 602,862 | 880,705 | |
Other financial assets | 16,818 | 14,118 | |
Non-current assets | 13,003,542 | 11,859,892 | |
Total assets | 14,124,689 | 13,368,761 | |
Current liabilities | |||
Borrowings and other financial liabilities | 397,421 | 28,288 | |
Trade and other payables | 384,488 | 390,059 | |
Deferred revenue | 149,368 | 103,289 | |
Current liabilities | 931,277 | 521,636 | |
Non-current liabilities | |||
Borrowings and other financial liabilities | 3,785,358 | 4,173,491 | |
Deferred income tax liabilities | 145,434 | 111,717 | |
Decommissioning obligations | 153,662 | 133,964 | |
Non-current liabilities | 4,084,454 | 4,419,172 | [1] |
Total liabilities | 5,015,731 | 4,940,808 | |
Equity | |||
Share capital | 11,432,122 | 11,432,122 | |
Contributed surplus | 1,555,774 | 1,558,834 | |
Accumulated other comprehensive income | 4,363 | 1,418 | |
Deficit | (2,890,711) | (3,415,601) | |
Equity attributable to owners of Turquoise Hill | 10,101,548 | 9,576,773 | |
Attributable to non-controlling interest | (992,590) | (1,148,820) | |
Total equity | 9,108,958 | 8,427,953 | |
Total liabilities and equity | $ 14,124,689 | $ 13,368,761 | |
[1] | The Oyu Tolgoi segment’s non-current liabilities includes $7.3 billion of shareholder loan and accrued interest liability and the Corporate and other elimination segment’s non-current liabilities includes $7.3 billion of shareholder loan and accrued interest asset at December 31, 2020. |
Consolidated Statements of Equi
Consolidated Statements of Equity - USD ($) $ in Thousands | Total | Share capital [member] | Contributed surplus [member] | Accumulated other comprehensive income (loss) [member] | Deficit [member] | Attributable to owners of Turquoise Hill [member] | Non-controlling interest [member] |
Beginning balance at Dec. 31, 2019 | $ 7,931,057 | $ 11,432,122 | $ 1,558,811 | $ (813) | $ (3,821,889) | $ 9,168,231 | $ (1,237,174) |
Income for the year | 494,642 | 406,288 | 406,288 | 88,354 | |||
Other comprehensive income for the year | 2,231 | 2,231 | 2,231 | ||||
Employee share plans | 23 | 23 | 23 | ||||
Ending balance at Dec. 31, 2020 | 8,427,953 | 11,432,122 | 1,558,834 | 1,418 | (3,415,601) | 9,576,773 | (1,148,820) |
Income for the year | 681,120 | 524,890 | 524,890 | 156,230 | |||
Other comprehensive income for the year | 2,945 | 2,945 | 2,945 | ||||
Employee share plans | (3,060) | (3,060) | (3,060) | ||||
Ending balance at Dec. 31, 2021 | $ 9,108,958 | $ 11,432,122 | $ 1,555,774 | $ 4,363 | $ (2,890,711) | $ 10,101,548 | $ (992,590) |
Nature of operations and liquid
Nature of operations and liquidity risk | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Nature of operations and liquidity risk | 1. Nature of operations and liquidity risk Rio Tinto plc is the ultimate parent company and indirectly owned a 50.8% majority interest in Turquoise Hill Resources Ltd. (“Turquoise Hill”), as at December 31, 2021. Turquoise Hill, together with its subsidiaries (collectively referred to as “the Company”), is an international mining company focused principally on the operation and further development of the Oyu Tolgoi copper-gold mine in Southern Mongolia. Turquoise Hill’s head office is located at 1 Place Ville Marie, Suite 3680, Montreal, Quebec, Canada, H3B 3P2. Turquoise Hill’s registered office is located at 300-204 Turquoise Hill has its primary listing in Canada on the Toronto Stock Exchange and a secondary listing in the U.S. on the New York Stock Exchange. The consolidated financial statements of Turquoise Hill were authorized for issue in accordance with a directors’ resolution on March 2, 2022. Liquidity risk is the risk that the Company will not be able to meet its financial obligations as they become due. The Company manages liquidity risk by the preparation of internally generated short-term cash flow forecasts and taking measures in response to the review of forecasts. These short-term cash flow forecasts consider estimation of future operating costs, financing costs, sustaining and development capital, tax payments and cash receipts from sales revenue. Sensitivity analyses are performed over these estimates including the impact of estimated commodity prices on cash receipts. As at December 31, 2021, the Company had $0.7 billion of available liquidity, consisting of consolidated cash and cash equivalents. The Company’s current assets exceeded current liabilities by $0.2 billion at December 31, 2021. The Company’s short-term cash flow forecasts indicate that additional financing will be required to fund its planned activities. In addition to the Company’s liquidity position and cash flow generated from its existing open pit operations, the Company plans to access sources of funding that form part of the Amended and Restated Heads of Agreement (“Amended HOA”) that was signed between the Company and Rio Tinto on January 25, 2022. Access to these sources of funding is considered probable with an equity offering of at least $650 million expected to be completed by August 31, 2022. The Amended HOA also provides the Company with access to a $300 million short-term secured advance from Rio Tinto, in the period to achievement of sustainable production, which is expected in the first half of 2023. The Company also expects to complete re-profiling In addition, these short-term cash flow forecasts include the possible impact of the COVID-19 COVID-19 COVID-19 million to the estimate of underground development capital included in the Definitive Estimate. This increase includes the currently known, incremental, time-related costs of COVID-19 The short-term cash flow forecasts at December 31, 2021 included the impact of the previously reported delay to sustainable production for Panel 0 until the first half of 2023, as announced by the Company on October 14, 2021. Forecasts reflect the expected cash requirements at Oyu Tolgoi LLC (“Oyu Tolgoi”) based on the approved 2022 capital and operating plan and assumes cash inflows from the drawdown of concentrate inventories to target levels at some point during 2022. The short-term cash forecasts at December 31, 2021 include the assessment of the estimated impact on the timing of cash receipts resulting from the ongoing force majeure that was first announced by the Company on March 30, 2021. Oyu Tolgoi concentrate inventory levels increased towards the end of the year as a result of interruptions to shipments across the border as a result of COVID-19 on-going on-site COVID-19 On January 24, 2022 the Company announced that it had successfully concluded the negotiations with various Mongolian governmental bodies to resolve the remaining outstanding non-technical The Company believes the funding available under the amended HOA provides sufficient liquidity to meet its minimum obligations for a period of at least 12 months from the balance sheet date, and to meet requirements of the Company, including its operations and capital expenditures, over the same period. |
Summary of significant accounti
Summary of significant accounting policies | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Summary of significant accounting policies | 2. Summary of significant accounting policies (a) Statement of compliance These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements have been prepared on a going concern basis, and in making the assessment that the Company is a going concern, management have taken into account all available future information, which extends for a period of at least 12 months from December 31, 2021. Refer to Note 1. (b) Change in accounting policies A number of new standards, and amendments to standards and interpretations, are effective as of January 1, 2021, and have been applied in preparing these consolidated financial statements. None of these standards and amendments to standards and interpretations had a significant effect on the consolidated financial statements of the Company. (c) Areas of judgement and estimation uncertainty The preparation of consolidated financial statements in accordance with IFRS often requires management to make estimates about, and apply assumptions or subjective judgement to, future events and other matters that affect the reported amounts of the Company’s assets, liabilities, revenues, expenses and related disclosures. Assumptions, estimates and judgements are based on historical experience, expectations, current trends and other factors that management believes to be relevant at the time the Company’s consolidated financial statements are prepared. With the emergence of the new and more transmissible Omicron variant in Mongolia and elsewhere, COVID-19 non-governmental COVID-19. By their very nature, COVID-19 (i) Sources of estimation uncertainty Key sources of estimation uncertainty that have a risk of resulting in a material adjustment to the carrying amount of assets and liabilities within the next twelve months are summarized below: Going concern assessment The Company has made judgements, based on an internally generated short-term cash flow forecast, in concluding that there are no material uncertainties related to events or conditions that may cast significant doubt upon the Company’s ability to continue as a going concern. The short term cashflow forecast includes plans to access additional sources of funding under the amended HOA where management consider implementation of those plans to be probable. Judgements and estimates are made in forming assumptions of future activities, future cash flows and timing of those cash flows, including cash flows relating to the financing plans for re-profiling Recoverable amount of property, plant and equipment When there is an indicator of impairment or impairment reversal, the recoverable amount is assessed by reference to the higher of value in use (“VIU”) and fair value less costs of disposal (“FVLCD”). The VIU is the net present value of expected future pre-tax post-tax life-of-mine These inputs are based on the Company’s best estimates of what an independent market participant would consider appropriate. Changes to these inputs may alter the results of the test for impairment or impairment reversal, the amount of the impairment charge or impairment reversal recorded in the consolidated statement of income and the resulting carrying value of property, plant and equipment . An indicator of impairment was identified during the year ended December 31, 2021, and an assessment of recoverable amount was undertaken as at December 31, 2021; refer to Note 13. Recovery of deferred tax assets in Mongolia The Company assesses the recoverability of deferred tax assets at each reporting period-end Reserves and Resources Estimates of mineral reserves and resources are based on various assumptions relating to operating matters set forth in National Instrument 43-101. cut-off 43-101 Estimated mineral reserves and, in certain circumstances, resources are used to determine the depreciation of property, plant and equipment; to account for capitalized deferred stripping costs; to perform, when required, assessments of the recoverable amount of property, plant and equipment; as an input to the projection of future taxable profits which support assessments of deferred income tax recoverability; and to forecast the timing of the payment of decommissioning obligations. Depletion and depreciation of property, plant and equipment Property, plant and equipment is the largest component of the Company’s assets and, as such, the depreciation of these assets has a significant effect on the Company’s financial statements. Mining plant and equipment and other capital assets are depreciated over their expected economic lives using either the units of production method or the straight-line method. Depletion of each mineral property interest is provided on the units of production basis using estimated proven and probable reserves as the depletion basis. A change in the estimated useful life or residual value of a long-lived asset would result in a change in the rate of depreciation for that asset. For long-lived assets that are depleted or depreciated over proven and probable reserves using the units of production method, a change in the original estimate of proven and probable reserves would result in a change in the rate of depletion or depreciation. Decommissioning Costs The estimate of decommissioning costs is based on future expectations in the determination of closure provisions. Management makes a number of assumptions and judgements including estimating the amount of future reclamation costs and their timing, inflation rates and risk-free discount rates. These assumptions are formed based on environmental and regulatory requirements and the Company’s internal policies. The costs are more uncertain the further into the future the mine closure activities are to be carried out. Actual costs incurred in future periods in relation to the remediation of the Company’s existing assets could differ materially from their estimated undiscounted future value. Refer to Note 17 for the Company’s total decommissioning obligations recorded in the consolidated financial statements, the undiscounted values and the rate used to discount the liability. Net realizable value of inventories Ore stockpile inventory is valued at the lower of weighted average cost and net realizable value (“NRV”). If ore stockpiles are not expected to be processed within the 12 months after the balance sheet date, they are included within non-current (ii) Areas of judgement Impairment indicator of property, plant and equipment Judgement is required in assessing whether certain factors would be considered an indicator of impairment or impairment reversal. Management considers both internal and external information to determine whether there is an indicator of impairment and, accordingly, whether impairment testing is required. The information considered in assessing whether there is an indicator of impairment includes, but is not limited to, long-term commodity prices, the Company’s market capitalization relative to its net asset carrying amount, life of mine plans and changes in significant assumptions including reserves and resources, development capital estimates and scheduling and mine designs. The Company’s assessment for the year ended December 31, 2021 considered the approval by the Oyu Tolgoi board of directors of the operating program and budget for the 2022 financial year, including over $780 million to cover capital plans relating to the Oyu Tolgoi underground project, which will allow continued progression towards undercutting. The Company’s assessment also considered the information included within its announcement on January 17, 2022, in relation to its fourth quarter 2021 production and in which the Company provided an update on the Oyu Tolgoi mine and the status of negotiations with the Government of Mongolia as at December 31, 2021. The Company’s assessment also considered the information included within its January 17, 2022 announcement regarding the ongoing COVID-19 COVID-19 The Company’s assessment also considered the status of negotiations between the Company, Rio Tinto and the Government of Mongolia as at December 31, 2021. On December 30, 2021, the Mongolian Parliament passed Parliamentary Resolution 103 to authorize the Government of Mongolia to take certain measures in connection with Oyu Tolgoi, restricting additional shareholder or third-party debt financing at the Oyu Tolgoi level until commencement of sustainable production. The effect of the resolution required key negotiations to continue into 2022. Despite the positive progress made through the negotiations in 2021, management concluded that the potential for further delays and the resulting uncertainty as to the timing of underground project completion constituted an indicator of impairment at the Oyu Tolgoi cash generating unit level at December 31, 2021. Subsequent to year-end, Income taxes - provision for income taxes and composition of deferred income tax assets and liabilities The Company must make significant estimates in respect of the provision for income taxes and the composition of its deferred income tax assets and deferred income tax liabilities. The Company’s operations are, in part, subject to foreign tax laws where interpretations, regulations and legislation are complex and can be subject to change. As a result, there are usually some tax matters in question which may, on resolution in the future, result in adjustments to the amount of current or deferred income tax assets or liabilities, and those adjustments may be material to the Company’s balance sheet and results of operations. The Company recognizes potential liabilities and records tax liabilities for uncertain tax positions based on its judgement of whether, and the extent to which, additional taxes will be due. Consistent with IFRIC 23, Uncertainty Over Income Tax Treatments, Income taxes – utilization of tax losses carried forward The determination of the ability of the Company to utilize tax losses carried forward to offset income taxes payable in the future and to utilize temporary differences which will reverse in the future requires management to exercise judgement and make assumptions about the Company’s future performance. Management is required to assess whether it is probable that the Company is able to benefit from these tax losses and temporary differences. (d) Basis of consolidation The financial statements consist of the consolidation of intercompany transactions and balances between Turquoise Hill and its subsidiaries have been eliminated on consolidation. Where necessary, adjustments are made to assets, liabilities, and results of subsidiaries to bring their accounting policies into line with those used by the Company. Subsidiaries are entities controlled by Turquoise Hill. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The Company controls an entity if it has power to direct the activities of the entity in a manner that significantly affects its returns, has exposure or rights to variable returns from its involvement with the entity and has the ability to use its power to affect those returns. The Company consolidates all subsidiaries. The Company’s principal operating subsidiary is Oyu Tolgoi. Wholly owned subsidiaries of Turquoise Hill together hold a 66.0% interest in Oyu Tolgoi, whose principal asset is the Oyu Tolgoi copper-gold mine located in Southern Mongolia. The remaining 34% non-controlling interest in Oyu Tolgoi is owned by Erdenes Oyu Tolgoi LLC (“Erdenes”), a company controlled by the Mongolian government. The Company has historically funded 100% of the Oyu Tolgoi copper-gold mine’s exploration and development costs via equity and debt investments in Oyu Tolgoi and non-recourse loans to Erdenes. Income or loss of Oyu Tolgoi is attributed to the controlling and non-controlling shareholders based on ownership percentage. Non-recourse loans advanced to Erdenes upon the issuance of additional equity interests to Erdenes are accounted for separately and recorded as an offset to non-controlling interest in equity. Unrealized interest on the non-recourse loans to Erdenes, which are recoverable principally through dividends from Oyu Tolgoi or sale by Erdenes of its interests in Oyu Tolgoi, is recognized when payment of the interest can be reliably determined. Subsequent to December 31, 2021, the Company waived these non-recourse (e) Currency translation and foreign exchange The Company has determined the U.S. dollar to be the functional currency of Turquoise Hill and its significant subsidiaries as it is the currency of the primary economic environment in which Turquoise Hill and all of its significant subsidiaries operate. Accordingly, monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect at the date of the balance sheet and non-monetary (f) Revenue The Company generates revenue from the sale of concentrate containing copper, gold and silver. Sales revenue is recognized on individual sales to depict the transfer of promised goods to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. The Company considers five steps in assessing whether all of the revenue recognition criteria are met: · identify the contract with a customer; · identify the performance obligations in the contract; · determine the transaction price; · allocate the transaction price to performance obligations; and · recognize revenue when or as a performance obligation is satisfied. The Company satisfies its performance obligation and sales revenue is recognized at the point in time when the product is delivered as specified by the customer, which is typically upon loading of the product to the customer’s truck, train or vessel. The Company considers that control has passed when there is a present obligation to pay from the customer’s perspective; physical possession, legal title and the risks and rewards of ownership have all passed to the customer; and the customer has accepted the concentrate. The Company recognizes deferred revenue in the event it receives payment from a customer before a sales transaction meets all the criteria for revenue recognition. Concentrate is provisionally priced whereby the selling price is subject to final adjustment at the end of a period normally ranging from 30 to 180 days after delivery to the customer as defined in the sales contract. The final price is based on the market price at the relevant quotation point stipulated in the Mining royalties paid to the government of Mongolia are included in operating expenses. (g) Exploration and evaluation All direct costs related to the acquisition of mineral property interests are capitalized in the period incurred. Exploration and evaluation costs are charged to operations in the period incurred until such time as it has been determined that a mineral property has proven and probable reserves and the property is economically viable, in which case subsequent evaluation costs incurred to develop a mineral property are capitalized. Exploration and evaluation costs include value-added taxes incurred in foreign jurisdictions when recoverability of those taxes is uncertain. (h) Property, plant and equipment Property, plant and equipment are recorded at cost, less accumulated depletion and depreciation and accumulated impairment losses. The cost of property, plant and equipment includes the estimated close down and restoration costs associated with the asset. Once an undeveloped mining project has been established as commercially viable, including that it has established proven and probable reserves and approval to mine by governmental authorities has been given, expenditure (including qualifying exploration and evaluation costs) other than on land, buildings, plant and equipment is capitalized under “Mineral property interests.” Ore reserves may be declared for an undeveloped mining project before its commercial viability has been fully determined and approval to mine has been given. Evaluation costs may be capitalized during the period between declaration of reserves and approval to mine as further work is undertaken in order to refine the development case to maximize the project’s return. Project development expenditures, including costs to acquire and construct buildings and equipment are capitalized under “Capital works in progress” provided that the project has been established as commercially viable. Capital works in progress are not categorized as mineral property interests, mining plant and equipment or other capital assets until the capital asset is in the condition and location necessary for its intended use. Sales of concentrate and associated costs, which are incurred during the commissioning phase, that are necessary for the successful commissioning of new assets, are capitalized. Development costs incurred after the commencement of production are capitalized to the extent they are expected to give rise to a future economic benefit. Borrowing costs related to construction or development of a qualifying asset are capitalized until the point when substantially all the activities that are necessary to make the asset ready for its intended use are complete. Where funds have been borrowed specifically to finance an asset, the amount capitalized is the actual interest on borrowings incurred, net of any returns on invested funds. Where the funds used to finance an asset form part of general borrowings, the amount capitalized is calculated using a weighted average of rates applicable to relevant general borrowings of the Company during the period. (i) Deferred stripping In open pit mining operations, it is necessary to remove overburden and other waste materials to access ore from which minerals can be extracted economically. The process of mining overburden and waste materials is referred to as stripping. During the development of an open pit mine, before production commences, stripping costs are capitalized as part of mineral property interests and are subsequently amortized over the life of the mine on a units of production basis. During the production phase, stripping activity is undertaken for the dual purpose of extracting inventory for current production as well as improving access to the ore body. Stripping costs incurred for the purpose of extracting current inventories are included in the costs of inventory produced during the period the stripping costs are incurred. In order for production phase stripping costs to qualify for capitalization as a stripping activity asset, three criteria must be met: · it must be probable that economic benefit will be realized in a future accounting period as a result of improved access to the ore body created by the stripping activity; · it must be possible to identify the “component” of the ore body for which access has been improved; and · it must be possible to reliably measure the costs that relate to the stripping activity. When the cost of stripping related to development which has a future benefit is not distinguishable from the cost of producing current inventories, the stripping costs are allocated to each activity based on a relevant production measure. Generally, the measure would be calculated based on a ratio obtained by dividing the tonnage of waste mined for the component for the period by the quantity of ore mined for the component. Stripping costs incurred in the period related to the component are deferred to the extent that the current period ratio exceeds the historical life of component ratio. The stripping activity asset is depreciated on a units of production basis based on expected production of ore over the useful life of the component that has been made more accessible as a result of the stripping activity. The life of component ratios are based on proven and probable reserves based on the mine plan; they are a function of the mine design and therefore changes to that design will generally result in changes to the ratios. Changes in other technical or economic parameters that impact reserves may also impact the life of component ratios. Changes to the life of component ratios are accounted for prospectively. Deferred stripping costs are included in “Mineral property interests” within property, plant and equipment. Amortization of deferred stripping costs is included as a cost of production in the period. (j) Depreciation and depletion Property, plant and equipment is depreciated over its useful life, or over the remaining life of the mine if that is shorter. The useful lives of the major assets of a cash-generating unit are often dependent on the life of the ore body to which they relate. Where this is the case, the lives of mining properties, and their associated concentrators and other long lived processing equipment generally relate to the expected life of the ore body. The life of the ore body, in turn, is estimated on the basis of the life-of-mine Development costs that relate to a discrete section of an ore body, and which only provide benefit over the life of those reserves, are depreciated over the estimated life of that discrete section. Development costs incurred that relate to the entire ore body are depreciated over the estimated life of the entire ore body. Assets within operations for which production is not expected to fluctuate significantly from one year to another or which have a physical life shorter than the mine are depreciated on a straight-line basis. Depreciation commences when an asset is available for use. (k) Impairment of non-current Property, plant and equipment is reviewed for impairment when events or changes in circumstances indicate that the full carrying amount may not be recoverable. Non-current assets that have previously been impaired are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may have reversed. Impairment is assessed at the level of cash-generating units which are identified as the smallest identifiable group of assets capable of generating cash inflows which are largely independent of the cash inflows from other assets. When an impairment review is undertaken, the recoverable amount is assessed by reference to the higher of VIU and FVLCD. The VIU is the net present value of expected future pre-tax The best evidence of FVLCD is often the value obtained from an active market or binding sale agreement. Where this is not the case, or where neither an active market nor a binding sale agreement exists, FVLCD is based on the best information available to reflect the amount a market participant would pay for the cash-generating unit in an arm’s length transaction. This is often estimated using discounted post tax cash flow techniques based on detailed life-of-mine The cash flow forecasts are based on management’s best estimates of expected future revenues and costs, including the future cash costs of production and capital expenditure, which for FVLCD purposes management believe approximate those of a market participant. Forecast cash flows for impairment purposes are generally based on management’s price forecasts of commodity prices, which assume short term observable market prices will revert to the Company’s assessment of the long term price, generally over a period of three to five years. These long-term forecast commodity prices are derived from industry analyst consensus. The discount rates applied to the future cash flow forecasts represent an estimate of the rate the market would apply having regard to the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted. (l) Decommissioning obligations The Company recognizes liabilities for statutory, contractual, legal or constructive obligations associated with the retirement of property, plant and equipment, when those obligations result from the acquisition, construction, development or normal operation of the assets. Initially, a provision for a decommissioning obligation is recognized at its net present value in the period in which it is incurred, using a discounted cash flow technique with market-based risk-free discount rates and estimates of the timing and amount of the settlement of the obligation. Upon initial recognition of the liability, the corresponding decommissioning cost is added to the carrying amount of the related asset. Following initial recognition of the decommissioning obligation, the carrying amount of the liability is increased for the passage of time and adjusted for changes to significant estimates including the current discount rate, the amount or timing of the underlying cash flows needed to settle the obligation and the requirements of the relevant legal and regulatory framework. Subsequent changes in the provisions resulting from new disturbance, updated cost estimates, changes to estimated lives of operations and revisions to discount rates are also capitalized to the related property, plant and equipment. Amounts capitalized to the related property, plant and equipment are depreciated over the lives of the assets to which they relate. The amortization or unwinding of the discount applied in establishing the net present value of provisions is charged to expense and is included within finance costs in the consolidated statement of income. (m) Inventories Concentrate inventory is valued at the lower of weighted average cost and net realizable value. Cost comprises production and processing costs, which includes direct and indirect labour, operating materials and supplies, applicable transportation costs and apportionment of operating overheads, including depreciation and depletion. Net realizable value is the expected average selling price of the concentrate inventory less applicable selling and transportation costs. Stockpiles represent ore that has been extracted and is available for further processing. Stockpiles are valued at the lower of weighted average production cost and net realizable value. Production cost includes direct and indirect labour, operating materials and supplies, applicable transportation costs, and apportionment of operating overheads, including depreciation and depletion. Net realizable value is the expected average selling price of the finished product less the costs to get the product into saleable form and to the selling location. If the ore will not be processed and sold within 12 months after the consolidated balance sheet date it is included within non-current Mine stores and supplies are valued at the lower of the weighted average cost and net realizable value. (n) Taxation Income tax expense comprises current and deferred tax. Current tax and deferred taxes are recognized in the consolidated statement of income except to the extent that they relate to items recognized directly in equity or in other comprehensive income. Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date. Deferred tax is recognized in respect of unused tax losses and credits, as well as temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on enacted or substantively enacted laws at the reporting date. The Company computes the provision for deferred income taxes under the liability method. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, only to the extent that it is probable that future taxable profits will be available against which they can be utilized. Future taxable profits are estimated using an income forecast derived from cash flow projections, based on detailed life-of-mine Deferred tax is not recognized for the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries, associates and joint arrangements to the extent that it is probable that they will not reverse in the foreseeable future. The Company is subject to assessments by various taxation authorities, who may interpret tax legislation differently from the Company. The final amount of taxes to be paid depends on a number of factors, including the outcomes of audits, appeals or negotiated settlements. Such differences are accounted for based on management’s best estimate of the probable outcome of these matters. The Company must make significant estimates and judgements in respect of its provision for income taxes and the composition and measurement of its deferred income tax assets and liabilities. The Company’s operations are, in part, subject to foreign tax laws where interpretations, regulations and legislation are complex and subject to change. As a result, there are some tax matters in question that may, upon resolution in the future, result in adjustments to the amount of deferred income tax assets and liabilities; those adjustments may be material. (o) Employee benefits Wages, salaries, contributions to government pension and social insurance funds, compensated absences and bonuses are accrued in the year in which the employees render the associated services. (p) Cash and cash equivalents For the purposes of the consolidated balance sheet, cash and cash equivalents comprise cash on hand, demand deposits and short term, highly liquid investments with an initial maturity of three months or less that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value. (q) Financial instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss, fair value through other comprehensive income or at amortized cost. Classification The Company determines the classification of financial instruments at initial recognition. The classification of debt instruments is driven by the Company’s business model for managing the financial assets and their contractual cash flow characteristics. A debt instrument is measured at amortized cost if the objective of the business model is to hold the debt instrument for the collection of contractual cash flows, and the asset’s contractual cash flows are comprised solely of payments of principal and interest (“SPPI”). A debt instrument held under a business model under which financial assets may be either held to collect contractual cash flows or sold is classified as held at fair value through other comprehensive income if the SPPI criteria are met. Any other financial assets are classified at fair value through profit or loss. Debt instruments held to maturity are classified as current or non-current instrument-by-instrument Financial liabilities are measured at amortized cost, unless they are required to be measured at fair value through profit or loss (such as instruments held for trading or derivatives) or where the Company has opted to measure at fair value through profit or loss. Measurement (i) Financial assets and liabilities at fair value through profit or loss Financial assets and liabilities at fair value through profit or loss are initially recognized at fair value and transaction costs are expensed in the consolidated statements of income. Realized and unrealized gains and losses arising from changes in fair value are included in the consolidated statement of income in the period in which they arise. Where the Company has elected to recognize a financial liability at fair value through profit or loss, any changes associated with the Company’s own credit risk will be recognized in other comprehensive income. (ii) Financial assets at fair value through other comprehensive income Investments in equity instruments at fair value through other comprehensive income are initially recognized at fair value plus transaction costs. Subsequent to initial recognition, they are measured at fair value, with gains and losses recognized in other comprehensive income. (iii) Financial assets and liabilities at amortized cost Financial assets and liabilities at amortized cost are initially recognized at f |
Operating segment
Operating segment | 12 Months Ended |
Dec. 31, 2021 | |
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Operating segment | 3. Operating segment Year Ended December 31, 2021 Corporate and other Oyu Tolgoi eliminations Consolidated Revenue $ 1,971,042 $ - $ 1,971,042 Cost of sales (622,329 ) - (622,329 ) Gross margin 1,348,713 - 1,348,713 Operating (expenses) income (321,257 ) 45,770 (275,487 ) Corporate administration expenses - (37,699 ) (37,699 ) Other expenses (7,575 ) (30,002 ) (37,577 ) Income (loss) before finance items and taxes 1,019,881 (21,931 ) 997,950 Finance items Finance income 1,783 1,215 2,998 Finance costs (282,606 ) 274,570 (8,036 ) Income from operations before taxes $ 739,058 $ 253,854 $ 992,912 Income and other taxes (279,559 ) (32,233 ) (311,792 ) Income for the year $ 459,499 $ 221,621 $ 681,120 Depreciation and depletion 165,269 97 165,366 Capital additions 1,263,698 - 1,263,698 Current assets 497,845 623,302 1,121,147 Non-current 13,375,066 (371,524 ) 13,003,542 Current liabilities 909,328 21,949 931,277 Non-current 12,443,023 (8,358,569 ) 4,084,454 Net increase (decrease) in cash 25,245 (454,570 ) (429,325 ) (a) The Oyu Tolgoi segment’s non- current non-current asset . Revenue by geographic destination is based on the ultimate country of destination, if known. If the destination of the concentrate sold through traders is not known, then revenue is allocated to the location of the concentrate at the time when revenue is recognized. During the years ended December 31, 2021 and 2020, principally all of Oyu Tolgoi’s revenue arose from concentrate sales to customers in China and revenue from individual customers in excess of 10% of Oyu Tolgoi’s revenue was $234.2 million, $226.0 Substantially all long-lived assets of the Oyu Tolgoi segment, other than financial instruments and deferred tax assets, are located in Year Ended December 31, 2020 Corporate and other Oyu Tolgoi eliminations Consolidated Revenue $ 1,078,192 $ - $ 1,078,192 Cost of sales (669,394 ) - (669,394 ) Gross margin 408,798 - 408,798 Operating (expenses) income (245,718 ) 43,447 (202,271 ) Corporate administration expenses - (30,602 ) (30,602 ) Other income (expenses) 3,254 (2,772 ) 482 Income before finance items and taxes 166,334 10,073 176,407 Finance items Finance income 4,292 13,057 17,349 Finance costs (257,765 ) 252,255 (5,510 ) Income (loss) from operations before taxes $ (87,139) $ 275,385 $ 188,246 Income and other taxes 347,003 (40,607 ) 306,396 Income for the year $ 259,864 $ 234,778 $ 494,642 Depreciation and depletion 181,146 114 181,260 Capital additions 1,326,274 - 1,326,274 Current assets 431,271 1,077,598 1,508,869 Non-current 12,025,763 (165,871 ) 11,859,892 Current liabilities 501,013 20,623 521,636 Non-current 11,954,961 (7,535,789 ) 4,419,172 Net decrease in cash (38,563 ) (489,801 ) (528,364 ) (a) The Oyu Tolgoi segment’s non-current billion of shareholder loan and accrued interest liability and the Corporate and other elimination non-current billion of shareholder loan and accrued interest asset at December 31, 2020. |
Revenue
Revenue | 12 Months Ended |
Dec. 31, 2021 | |
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Revenue | 4. Revenue Year Ended December 31, 2021 Revenue from contracts with customers Other Total revenue Total revenue: Copper $ 1,151,118 $ 53,401 $ 1,204,519 Gold 754,345 (5,763 ) 748,582 Silver 18,127 (186 ) 17,941 $ 1,923,590 $ 47,452 $ 1,971,042 Year Ended December 31, 2020 Revenue from contracts with customers Other Total revenue Total revenue: Copper $ 755,874 $ 41,423 $ 797,297 Gold 260,055 5,593 265,648 Silver 14,575 672 15,247 $ 1,030,504 $ 47,688 $ 1,078,192 (a) Other revenue relates to gains (losses) on the revaluation of trade receivables. |
Cost of sales
Cost of sales | 12 Months Ended |
Dec. 31, 2021 | |
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Cost of sales | 5. Cost of sales Year Ended December 31, 2021 2020 Production and delivery $ 459,322 $ 493,370 Depreciation and depletion 163,007 176,024 $ 622,329 $ 669,394 |
Operating expenses
Operating expenses | 12 Months Ended |
Dec. 31, 2021 | |
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Operating expenses | 6. Operating expenses Year Ended December 31, 2021 2020 Oyu Tolgoi administration expenses $ 156,066 $ 124,889 Royalty expenses 105,399 63,420 Inventory reversals (a) (3,465 ) (2,703 ) Selling expenses 15,041 11,147 Depreciation 2,359 5,236 Other 87 282 $ 275,487 $ 202,271 (a) Inventory reversals include net adjustments to the carrying value of ore stockpile inventories and materials and supplies; refer to Note 9. |
Finance items
Finance items | 12 Months Ended |
Dec. 31, 2021 | |
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Finance items | 7. Finance items Year Ended December 31, 2021 2020 Finance income: Interest income (a) $ 2,998 $ 17,349 $ 2,998 $ 17,349 Finance costs: Interest expense and similar charges $ (299,618 ) $ (340,040 ) Amounts capitalized to property, plant and equipment (b) 297,392 337,727 Accretion of decommissioning obligations (Note 17) (5,810 ) (3,197 ) $ (8,036 ) $ (5,510 ) (a) Finance income for the year ended December 31, 2021 does not include interest on the related party receivable. For the year ended December 31, 2020, f (b) The majority of the costs capitalized to property, plant and equipment were capitalized at the weighted average rate of the Company’s general borrowings of 8.1% (2020: 8.3%) (refer to Note 13). |
Cash and cash equivalents
Cash and cash equivalents | 12 Months Ended |
Dec. 31, 2021 | |
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Cash and cash equivalents | 8. Cash and cash equivalents December 1 December 0 Cash at bank and on hand 101,745 $ 61,783 Money market funds 193,243 667,542 Other cash equivalents 399,308 394,296 $ 694,296 $ 1,123,621 |
Inventories
Inventories | 12 Months Ended |
Dec. 31, 2021 | |
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Inventories | 9. Inventories December 31, December 31, Current Concentrate $ 148,270 $ 48,504 Ore stockpiles 27,911 44,846 Materials and supplies 185,797 180,038 Provision against carrying value of materials and supplies (71,961 ) (75,426 ) $ 290,017 $ 197,962 Non-current Ore stockpiles $ 60,711 $ 37,557 $ 60,711 $ 37,557 During the year ended December 31, 2021, $622.3 million (2020 - $669.4 million) of inventory was charged to cost of sales (Note 5). During the year ended December 31, 2021, net reversals of $3.5 million (2020 - $2.7 million) were recognized in the consolidated statement of income relating to inventory write off and movement in provisions against carrying value. During the year ended December 31, 2021 , inventory (2020 - $ million) with a provision against its carrying value was sold. |
Trade and other receivables
Trade and other receivables | 12 Months Ended |
Dec. 31, 2021 | |
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Trade and other receivables | 10. Trade and other receivables December 31, December 31, Trade receivables from provisionally priced sales $ 13,645 $ 50,459 Other receivables 2,435 8,701 Due from related parties (Note 22) 39 852 $ 16,119 $ 60,012 |
Prepaid expenses and other asse
Prepaid expenses and other assets | 12 Months Ended |
Dec. 31, 2021 | |
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Prepaid expenses and other assets | 11. Prepaid expenses and other assets December 31, December 31, Current Prepaid Expenses: Prepaid expenses $ 38,881 $ 44,130 Amounts prepaid to related parties (Note 22) 81,725 83,144 $ 120,606 $ 127,274 Non-current Prepaid Mongolian corporate tax (Note 23) $ 348,171 $ - Other 500 - $ 348,671 $ - |
Other non-current financial ass
Other non-current financial assets | 12 Months Ended |
Dec. 31, 2021 | |
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Other non-current financial assets | 12. Other non-current December 31, December 31, Current assets: Commodity put options $ 109 $ - $ 109 $ - Non-current Marketable securities $ 9,323 $ 6,379 Other 7,495 7,739 $ 16,818 $ 14,118 |
Property, plant and equipment
Property, plant and equipment | 12 Months Ended |
Dec. 31, 2021 | |
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Property, plant and equipment | 13. Property, plant and equipment Oyu Tolgoi Year Ended December 31, 2021 Mineral Plant and Capital works Other capital Total Net book value: January 1, 2021 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Additions (a) 33,208 13,906 919,192 - 966,306 Interest capitalized (Note 7) - - 297,392 - 297,392 Changes to decommissioning obligations (Note 17) 13,888 - - - 13,888 Depreciation for the period (48,967) (181,405) - (97) (230,469) Disposals and write offs - (149) - - (149) Transfers and other movements - 148,720 (148,720) - - December 31, 2021 $ 693,681 $ 2,992,594 $ 8,287,366 $ 839 $ 11,974,480 Cost 1,350,231 5,023,101 8,652,073 1,131 15,026,536 Accumulated depreciation / impairment (656,550) (2,030,507 ) (364,707) (292) (3,052,056 ) December 31, 2021 $ 693,681 $ 2,992,594 $ 8,287,366 $ 839 $ 11,974,480 Non-current $ 693,681 $ 2,992,594 $ 8,287,366 $ - $ 11,973,641 Oyu Tolgoi Year Ended December 31, 2020 Mineral Plant and Capital works Other capital Total Net book value: January 1, 2020 $ 723,516 $ 3,126,331 $ 5,931,750 $ 1,050 $ 9,782,647 Additions (a) 5,965 - 982,582 - 988,547 Interest capitalized (Note 7) - - 337,727 - 337,727 Changes to decommissioning obligations (Note 17) 26,529 - - - 26,529 Depreciation for the period (60,458) (145,979) - (114) (206,551) Disposals and write offs - (858) (529) - (1,387) Transfers and other movements - 32,028 (32,028) - - December 31, 2020 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Cost 1,303,134 4,868,370 7,584,209 1,131 13,756,844 Accumulated depreciation / impairment (607,582) (1,856,848) (364,707) (195) (2,829,332) December 31, 2020 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Non-current $ 695,552 $ 3,011,522 $ 7,219,502 $ - $ 10,926,576 (a) Pre-production (b) In addition to property, plant and equipment, at December 31, 2021 current and non-current (c) Plant and equipment comprise owned and leased assets: December 31, December 31, 2021 2020 Plant and equipment owned $ 11,961,967 $ 10,923,294 Right of use assets 12,513 4,218 $ 11,974,480 $ 10,927,512 The Company leases certain assets including warehouse and office facilities as well as transportation equipment, substantially all at Oyu Tolgoi. Information about leases for which the Company is a lessee is presented below: Year Ended December 31, Plant and equipment: 2021 2020 Opening Carrying Amount $ 4,218 $ 8,710 Additions 13,945 - Depreciation for the period (5,650 ) (4,492 ) $ 12,513 $ 4,218 (d) Impairment charges As disclosed in the press release on December 13, 2021, Turquoise Hill and Rio Tinto made a joint offer to the Government of Mongolia to conclude negotiations over the non-technical The recoverable amount was determined by a fair value less cost of disposal (FVLCD) model using post-tax life-of-mine post-tax The Company’s assessment of recoverable amount at December 31, 2021 did not result in any additional impairment or impairment reversal being recorded at December 31, 2021. The recoverable amount was estimated taking into account technical risks associated with the mine plan through to ramp-up COVID-19 Together with operating costs, development capital, and scheduling and mine design, other significant assumptions in the determination of recoverable amount include the discount rate, long-term commodity prices and the inclusion of mineral resources (in addition to mineral reserves). Reasonably possible movements in the assumptions disclosed in Note 2 - impairment could have changed the calculated recoverable amount. An increase in the post-tax real discount rate by %, with all other inputs remaining constant, would reduce the recoverable amount by $1.6 billion. A 5% decrease to the long-term copper and gold prices, with all other inputs remaining constant, would reduce the recoverable amount by 1.1 billion. A 5% increase to the long-term copper and gold prices, with all other inputs remaining constant, would increase the recoverable amount by $1.1 billion. |
Trade and other payables
Trade and other payables | 12 Months Ended |
Dec. 31, 2021 | |
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Trade and other payables | 14. Trade and other payables December 31, December 31, 2021 2020 Trade payables and accrued liabilities $ 320,791 $ 315,570 Interest payable on long-term borrowings 7,280 7,266 Payable to related parties (Note 22) 54,153 65,552 Other 2,264 1,671 $ 384,488 $ 390,059 |
Borrowings and other financial
Borrowings and other financial liabilities | 12 Months Ended |
Dec. 31, 2021 | |
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Borrowings and other financial liabilities | 15. Borrowings and other financial liabilities December 31, December 31, 2021 2020 Current liabilities: Project finance facility (a) $ 387,561 $ 27,567 Lease liabilities (b) 9,860 721 $ 397,421 $ 28,288 Non-current Project finance facility (a) $ 3,769,783 $ 4,157,344 Lease liabilities (b) 15,575 16,147 $ 3,785,358 $ 4,173,491 (a) Project finance facility On December 14, 2015, Oyu Tolgoi signed a $4.4 billion project finance facility. The facility is provided by a syndicate of international financial institutions and export credit agencies representing the governments of Canada, the United States and Australia, along with 15 commercial banks. The project finance lenders have agreed a debt cap of $6.0 billion. In addition to the funding drawn down to date there is an additional $0.1 billion available, subject to certain conditions (refer to Note 26 – Subsequent events), under the Company’s facility with the Export-Import Bank of the United States, and the potential for an additional $1.6 billion of supplemental debt in the future. Under the terms of the project finance facility held by Oyu Tolgoi, there are certain restrictions on the ability of Oyu Tolgoi to make shareholder distributions. Subsequent to December 31, 2021, Oyu Tolgoi notified its lenders of a potential event of default. Refer to Note 26. At December 31, 2021, Oyu Tolgoi has drawn down $ billion December 31, 2021 Original Annual interest rate Facility Carrying Value (i) Fair Value (i) Term (ii) Pre-completion Post-completion International Financial Institutions $ 775,836 $ 820,958 15 years LIBOR + 3.78% LIBOR + 4.78% Export Credit Agencies 865,801 921,116 14 years LIBOR LIBOR + 4.65% Loan 277,511 311,637 13 years 2.3% 2.3% MIGA Insured Loan (iii) 673,248 711,980 12 years LIBOR + 2.65% LIBOR Commercial Banks 1,564,948 1,672,455 12 years LIBOR + 3.4% LIBOR + 4.4% - B Loan Includes $50 million 15-year loan at A Loan rate $ 4,157,344 $ 4,438,146 (i) The carrying value of borrowings under the project finance facility differs from fair value due to amortized transaction costs, and changes in the estimate of fair value between the initial recognition date and the balance sheet date. Project finance borrowings were initially recognized at fair value less transaction costs on the relevant draw down dates, with aggregate initial fair value being $4,348.9 million before transaction costs. At December 31, 2021, these borrowings are stated net of $124.8 million unamortized transaction costs. At December 31, 2021, the fair value of the Company’s borrowings has been estimated with reference to a market yield, the variability of which is considered a reasonable indicator, over the pre-completion in-country pre-completion pre-completion (ii) The project finance facility provides for interest only payments for the first five years followed by minimum repayments according to a stepped amortization schedule for the remaining life of the facility. The maturity analysis of principal repayments is as follows: December 31, December 31, Maturity analysis - Project Finance facility (1) Less than one year $ 403,483 $ 43,489 One to five years 2,610,445 2,418,861 More than five years 1,268,212 1,863,279 $ 4,282,140 $ 4,325,629 (1) The rows are represented in dates as follows: As at December 31, 2021: 12 months to December 31, 2022; 48 months between January 1, 2023 and December 31, 2026; Beyond January 1, 2027. As at December 31, 2020: 12 months to December 31, 2021; 48 months between January 1, 2022 and December 31, 2025; Beyond January 1, 2026. (iii) The Multilateral Investment Guarantee Agency (“MIGA”) provides political risk insurance for commercial banks. The Company is required to pay an annual insurance premium of 1.4% of the MIGA Insured Loan for the remaining life of the facility. (b) Lease liabilities December 31, December 31, Maturity analysis - contractual undiscounted cash flows (1) Less than one year $ 10,727 $ 1,121 One to five years 20,752 19,631 More than five years 306 205 Total undiscounted lease liabilities $ 31,785 $ 20,957 Lease liabilities included in the Consolidated balance sheet $ 25,435 $ 16,868 Current $ 9,860 $ 721 Non-Current $ 15,575 $ 16,147 (1) The rows are represented in dates as follows: As at December 31, 2021: 12 months to December 31, 2022; 48 months between January 1, 2023 and December 31, 2026; Beyond January 1, 2027. As at December 31, 2020: 12 months to December 31, 2021; 48 months between January 1, 2022 and December 31, 2025; Beyond January 1, 2026. Lease liabilities are discounted at the weighted average incremental borrowing rate of 7.6% (2020: 7.8%). |
Income taxes
Income taxes | 12 Months Ended |
Dec. 31, 2021 | |
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Income taxes | 16. Income taxes (a) Tax expense (benefit) Year Ended December 31, 2021 2020 Current (i) $ 232 $ 7,694 Deferred Temporary differences including tax losses (ii) 277,843 (346,627 ) Withholding taxes (iii) 33,717 32,537 $ 311,560 $ (314,090 ) Net income statement expense (benefit) for income taxes $ 311,792 $ (306,396 ) (i) Current taxes In 2021, a cash payment of $0.2 million (2020 - $28.3 million) was made in respect of current taxes payable. Deferred tax liabilities for withholding taxes are reclassified to current tax prior to settlement. (ii) Deferred tax assets 2021 – Mongolia Deferred tax assets of $561.9 million were recognized at December 31, 2021 in Mongolia, comprised of $150.7 million relating to tax losses that expire if not recovered against taxable income within eight years and $411.2 million relating to accrued but unpaid interest expense and other temporary The Company recognized deferred tax assets at December 31, 2021 to the extent recovery is considered probable. In assessing the probability of recovery, future taxable income, derived from cash flows from detailed life-of-mine During the year ended December 31, 2021, the Company de de Thi s was partially offset by , which The adjustment to the previously recognized deferred tax asset for prior year losses and other temporary differences was due in part to the utilization of prior year losses carried forward against taxable income in the year combined with the changes made to mine plan operating assumptions, which led to an increase in the amount of loss carry forwards and temporary differences estimated to expire unutilized. 2020 – Mongolia Deferred tax assets of $841.3 million were recognized at December 31, 2020 in Mongolia, comprised of $389.3 million relating to tax losses that expire if not recovered against taxable income within eight years and $452.0 million relating to accrued but unpaid interest expense and other temporary differences. During the year ended December 31, 2020, the Company increased its recognized Mongolian deferred tax assets by $347.3 million. The movement in the Mongolian deferred tax asset represented an increase of $270.7 million in the recognized deferred tax asset for prior year losses and other temporary differences and an increase of $76.6 million related to current year activity. The adjustment to the Mongolian deferred tax was primarily due to an overall strengthening in taxable income forecasts during 2020 driven by improved commodity price projections and updated operating assumptions in mine planning and scheduling. The improvement in taxable income forecasts led to an increase in the amount of loss carry forwards and temporary differences estimated to be utilized prior to expiration. 2021 – Canada Deferred tax assets of $41.0 million were recognized at December 31, 2021 in Canada comprised of $39.5 million relating to non-capital in additional non-capital incurred in the year, only part of which is estimated to be utilized prior to expiration. Non-capital 2020 – Canada Deferred tax assets at December 31, 2020 were $39.4 non-capital (iii) Withholding taxes Withholding tax is accrued on interest owing on shareholder loans and recognized within deferred tax liabilities as interest accrues. Mongolian withholding tax will be due upon receipt of loan interest. (b) Reconciliation of income taxes calculated at the statutory rates to the actual tax provision Year Ended December 31, 2021 2020 Income (loss) from operations before taxes $ 992,912 $ 188,246 Tax at Canadian combined federal and provincial income tax rate (2021: 26.5%; 2020: 26.5%) 263,122 49,885 Tax effect of: Change in amount of deferred tax recognized 151,117 (276,945 ) Difference in tax rates and treatment in foreign jurisdictions (140,903 ) (116,208 ) Withholding taxes 33,717 32,537 Non deductible losses and expense 4,739 4,335 $ 311,792 $ (306,396 ) (c) Recognized and unrecognized deferred tax assets and liabilities Recognized and unrecognized deferred tax assets and liabilities are shown in the table below: Recognized Unrecognized December 31, December 31, December 31, December 31, 2021 2020 2021 2020 Deferred tax assets Non-capital $ 190,203 $ 427,695 $ 152,853 $ 281,643 Capital losses - - 117,517 117,945 Other temporary differences including accrued interest 412,659 453,010 319,227 63,471 $ 602,862 $ 880,705 $ 589,597 $ 463,059 Deferred tax liabilities (ii) Withholding tax (145,434 ) (111,717 ) - - $ (145,434 ) $ (111,717 ) $ - $ - (i) Unrecognized deferred tax assets relating to non-capital (c) Recognized and unrecognized deferred tax assets and liabilities (ii) At December 31, 2021, the Company has not recognized a deferred tax liability on unremitted earnings in subsidiaries of In addition to the above, the Company has $812.1 December 31, 2021 (2020 – $812.1 million). Income taxes |
Decommissioning obligations
Decommissioning obligations | 12 Months Ended |
Dec. 31, 2021 | |
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Decommissioning obligations | 17. Decommissioning obligations Year Ended December 31, 2021 2020 Opening carrying amount $ 133,964 $ 104,238 Changes in estimates 13,888 26,529 Accretion of present value discount 5,810 3,197 $ 153,662 $ 133,964 All decommissioning obligations relate to Oyu Tolgoi. Reclamation and closure costs have been estimated based on the Company’s interpretation of current regulatory requirements and other commitments made to stakeholders , and are measured as the net present value of estimated future cash expenditures upon reclamation and closure. Estimated future cash expenditures of $349.7 million (2020 - $227.8 million), before discounting, have been discounted from anticipated closure dates that range from 2070 to 2101 (2020 – anticipated closure date 2055) to their present value at a real rate of 1.5% (December 31, 2020 – 1.5%). |
Share capital
Share capital | 12 Months Ended |
Dec. 31, 2021 | |
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Share capital | 18. Share capital The authorized share capital of Turquoise Hill consists of an unlimited number of Common Shares without par value and an unlimited number of Preferred Shares. On October (or reverse stock split) of the Company’s issued and outstanding common shares at a pre-consolidation (“Share Consolidation”). The Share Consolidation reduced the number of issued and outstanding common shares of the Company from shares to shares. As at December 31, 2021, there were 201,231,446 Common Shares and no Preferred Shares issued and outstanding (2020: 201,231,446 Common Shares and no Preferred Shares issued and outstanding). |
Non-controlling interests
Non-controlling interests | 12 Months Ended |
Dec. 31, 2021 | |
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Non-controlling interests | 19. Non-controlling Non-controlling Oyu Tolgoi (a) Year Ended December 31, 2021 2020 Balance, January 1 $ (1,148,820 ) $ (1,237,174 ) Non-controlling income 156,230 88,354 Common share investments funded on behalf of non-controlling 20,400 137,700 Funded amounts repayable to the Company (a) (20,400 ) (137,700 ) Balance, December 31 $ (992,590 ) $ (1,148,820 ) (a) Since 2011, the Company has funded common share investments in Oyu Tolgoi on behalf of Erdenes. In accordance with the Amended and Restated Shareholders Agreement dated June 8, 2011, such funded amounts earn interest at an effective annual rate of LIBOR plus 6.5% and we d Common share investments funded on behalf of Erdenes have been non-controlling was expected to be ould not On January 24, 2022 the Company announced the start of underground mining operations at Oyu Tolgoi and agreements that reset the relationship with the Government of Mongolia. These agreements included a waiver of the common share investments funded on behalf of Erdenes, together with the accrued interest relating to this funding – see Note 26. |
Cash flow information
Cash flow information | 12 Months Ended |
Dec. 31, 2021 | |
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Cash flow information | 20. Cash flow information (a) Reconciliation of net income to net cash flow generated from operating activities before interest and tax Year Ended December 31, 2021 2020 Income (loss) for the year $ 681,120 $ 494,642 Adjustments for: Depreciation and amortization 165,366 181,260 Finance items: Interest income (2,998 ) (17,349 ) Interest and accretion expense 8,036 5,510 Unrealized foreign exchange (gain) loss 2,228 (4,297 ) Inventory write down reversals (3,465 ) (2,703 ) Write off of property, plant and equipment 87 282 Realized and unrealized losses on commodity put options 29,797 - Income and other taxes 311,792 (306,396 ) Other items 258 2,403 Net change in non-cash (Increase) decrease in: Inventories (109,212 ) (26,534 ) Trade, other receivables and prepaid expenses 52,148 (43,456 ) (Decrease) increase in: Trade and other payables 29,554 12,414 Deferred revenue 46,079 75,393 Cash generated from operating activities before interest and tax $ 1,210,790 $ 371,169 (b) Supplementary information regarding other non-cash The non-cash Year Ended December 31 2021 2020 Investing activities Change in accounts payable and accrued liabilities related to purchase of property, plant and equipment $ (40,022 ) $ (79,879) Additions to property, plant and equipment - leased assets 13,945 - |
Earnings per share
Earnings per share | 12 Months Ended |
Dec. 31, 2021 | |
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Earnings per share | 21. Earnings per share Basic earnings per share is computed by dividing the net income attributable to owners of Turquoise Hill by the weighted average number of common shares outstanding during the period. Pursuant to the Share Consolidation (refer to Note 18), the reduction in the number of issued and outstanding common shares was retrospectively incorporated into the determination of the basic weighted average number of shares outstanding for the purpose of calculating basic and diluted earnings per share attributable to Turquoise Hill Resources Ltd. As of December 31, 2021 and 2020, the Company had not issued any equity instruments that are potentially dilutive to earnings per share. |
Related parties
Related parties | 12 Months Ended |
Dec. 31, 2021 | |
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Related parties | 22. Related parties As at December 31, 2021, Rio Tinto plc’s indirect equity ownership in the Company was 50.8% (December 31, 2020: 50.8%). The following tables present the consolidated financial statements line items within which transactions with a Rio Tinto entity or entities (“Rio Tinto”) are reported. Rio Tinto entities comprise Rio Tinto plc, Rio Tinto Limited and their respective subsidiaries other than Turquoise Hill and its subsidiaries. Year Ended December 31, Statements of Income 2021 2020 Operating and corporate administration expenses: Cost recoveries - Turquoise Hill $ 1,151 $ 2,803 Management services payment (i) (29,706 ) (28,305 ) Cost recoveries - Rio Tinto (ii) (66,362 ) (38,213 ) Finance income: Cash and cash equivalents (iii) - 2,329 Receivable from Rio Tinto (iv) - 2,123 Finance costs: Completion support fee (v) (109,315 ) (110,054 ) $ (204,232 ) $ (169,317 ) Year Ended December 31, Statements of Cash Flows 2021 2020 Cash generated from operating activities Interest received (iii, iv) $ - $ 9,848 Interest paid (v) (107,896 ) (107,948 ) Cash flows from investing activities Receivable from related party: amounts withdrawn (iv) - 511,284 Expenditures on property, plant and equipment: Management services payment and cost recoveries - Rio Tinto (i), (ii) (37,302 ) (75,470 ) Balance Sheets December 31, December 31, Trade and other receivables (Note 10) $ 39 $ 852 Prepaid expenses and other assets (Note 11) 81,725 83,144 Trade and other payables (Note 14) Management services payment - Rio Tinto (i) (14,584 ) (13,137 ) Cost recoveries - Rio Tinto (ii) (39,569 ) (52,415 ) $ 27,611 $ 18,444 (i) In accordance with the Amended and Restated Shareholders’ Agreement, which was signed on June 8, 2011, and other related agreements, Turquoise Hill is required to make a management services payment to Rio Tinto equal to a percentage of all capital costs and operating costs incurred by Oyu Tolgoi from March 31, 2010 onwards. After signing the Underground Mine Development and Financing Plan on May 18, 2015, the management services payment to Rio Tinto has been calculated as 1.5% applied to underground development and sustaining (ii) Rio Tinto recovers the costs of providing general corporate support services and mine management services to Turquoise Hill. Mine management services are provided by Rio Tinto in its capacity as the manager of Oyu Tolgoi. (iii) In addition to placing cash and cash equivalents on deposit with banks or investing funds with other financial institutions, Turquoise Hill may deposit cash and cash equivalents with Rio Tinto in accordance with an agreed upon policy and strategy for the management of liquid resources. Funds deposited with Rio Tinto earn interest at rates equivalent to those offered by financial institutions or short-term corporate debt. At December 31, 2021 and December 31, 2020, there were no funds deposited with wholly owned subsidiaries of Rio Tinto. (iv) As part of project finance (Note 15), Turquoise Hill appointed 9539549 Canada Inc., a wholly owned subsidiary of Rio Tinto, as service provider to provide post-drawdown cash management services in connection with net proceeds from the project finance facility, which were placed with 9539549 Canada Inc. and shall be returned to Turquoise Hill as required for purposes of Oyu Tolgoi underground mine development and funding. Rio Tinto International Holdings Limited, a wholly owned subsidiary of Rio Tinto, agreed to guarantee the obligations of the service provider under this agreement. At December 31, 2021 and December 31, 2020, there were no amounts due from 9539549 Canada Inc. Amounts due had been earning interest at an effective annual rate of LIBOR plus 2.45%. The interest rate reflected: interest receivable at LIBOR minus 0.05%; plus a benefit of 2.5% arising on amounts receivable from 9539549 Canada Inc. under the Cash Management Services Agreement, which are net settled with the 2.5% completion support fee described in (v) below. (v) As part of the project finance agreements (Note 15), Rio Tinto agreed to provide a guarantee, known as the completion support undertaking (“CSU”) in favour of the Commercial Banks and the Export Credit Agencies. In consideration for providing the CSU, the Company is required to pay Rio Tinto a fee equal to 2.5% of the amounts drawn under the facility. The annual completion support fee of 2.5% on amounts drawn under the facility is accounted for as a borrowing cost and included within interest expense and similar charges (refer to Note 7). The fee is settled net of a benefit arising on amounts receivable from 9539549 Canada Inc. under the Cash Management Services Agreement described in (iv) above. The fee payment obligation will terminate on the date Rio Tinto’s CSU obligations to the project lenders terminate. The above noted transactions were carried out in the normal course of operations and were measured at the transaction amount, which is the amount of consideration established and agreed to by the related parties. |
Commitments and contingencies
Commitments and contingencies | 12 Months Ended |
Dec. 31, 2021 | |
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Commitments and contingencies | 23. Commitments and contingencies (a) Capital commitments At December 31, 2021, the Company had capital expenditure commitments at the balance sheet date of $ million. These commitments represent minimum non-cancellable obligations and exit costs for cancellable obligations. At December 31, 2021, the Company had minimum non-cancellable (b) Mongolian Tax Assessments On January 16, 2018, the Company announced that Oyu Tolgoi received a tax assessment for approximately $155 million (which was converted from Mongolian Tugrik to U.S. dollars at the exchange rate on that date) from the “MTA” as a result of a general tax audit for the period covering 2013 through 2015 (“2013 to 2015 Tax Assessment”). In January 2018 Oyu Tolgoi paid an amount of $4.8 million to settle unpaid taxes, fines , The Company was of the opinion that Oyu Tolgoi had paid all taxes and charges required under the 2009 Oyu Tolgoi Investment Agreement (“Investment Agreement”), the Amended and Restated Shareholder Agreement (“ARSHA”), the Underground Mine Development and Financing Plan and Mongolian Law (“UDP”). Following engagement with the MTA, Oyu Tolgoi was advised that the MTA could not resolve Oyu Tolgoi’s objections to the 2013 to 2015 Tax Assessment. On February 20, 2020, the Company announced that Oyu Tolgoi had proceeded with the initiation of a formal international arbitration proceeding in accordance with the dispute resolution provisions within Chapter 14 of the Investment Agreement, entered into with the Government of Mongolia in 2009 and Chapter 8 of the UDP, entered into with the Government of Mongolia in 2015. The dispute resolution provisions call for arbitration under the United Nations Commission on International Trade Law (“UNCITRAL”) seated in London before a panel of three arbitrators. By agreeing to resolve certain matters within the 2013 to 2015 Tax Assessment dispute under UNCITRAL Arbitration Rules, both parties agreed that the arbitral award shall be final and binding on both parties and the parties shall carry out the award without delay. On December 23, 2020, the Company announced that Oyu Tolgoi had received a tax assessment for approximately $228 million (which was converted from Mongolian Tugrik to U.S. dollars at the exchange rate on that date) from the MTA relating to an audit on taxes imposed and paid by Oyu Tolgoi between 2016 and 2018 (“2016 to 2018 Tax Assessment”). The MTA also proposed a $1.4 billion adjustment to the balance of Oyu Tolgoi’s carried forward tax losses. The adjustments are to disallow or defer certain tax deductions claimed in the 2016 to 2018 years. On January 11, 2021, the Company announced that Oyu Tolgoi had evaluated the 2016 to 2018 Tax Assessment claim and confirmed that Oyu Tolgoi had given notice of its intention to apply to the Tribunal in the Arbitration for leave to amend its Statement of Claim to include certain matters raised in the 2016 to 2018 Tax Assessment. Most of the matters raised in respect of the 2016 to 2018 Tax Assessment are of a similar nature to the matters that were raised in the 2013 to 2015 Tax Assessment. Oyu Tolgoi’s application to include these matters in the Arbitration for the 2013 to 2015 Tax Assessment was accepted. In addition to those matters included within the Statement of Claim, there were certain limited tax matters included in the 2013 to 2015 and 2016 to 2018 Tax Assessments which were being addressed in local Mongolian tax courts. The Company has expensed certain amounts related to these matters and has also adjusted its loss carry forwards. In February 2021, Oyu Tolgoi received notices of payment totalling $228 million (which were converted from Mongolian Tugrik to U.S. dollars at the exchange rate on the relevant dates) relating to amounts disputed under the 2016 to 2018 Tax Assessment. In March 2021, Oyu Tolgoi received notices of payment totalling $126 million (which were converted from Mongolian Tugrik to U.S. dollars at the exchange rate on the relevant dates) relating to amounts disputed under the 2013 to 2015 Tax Assessment. Under the Mongolian General Tax Law, the amounts were due and paid by Oyu Tolgoi LLC within 10 business days from the dates of the notices of payment. Under the same legislation, Oyu Tolgoi LLC would be entitled to recover the amounts, including via offset against future tax liabilities, in the event of a favourable decision from the relevant dispute resolution authorities. These payments were recorded within non-current On May 3, 2021, the Company announced that the Government of Mongolia filed its statement of defence together with a counterclaim (“GOM Defence and Counterclaim”) in relation to the international tax arbitration proceeding brought by Oyu Tolgoi against the Government of Mongolia on February 20, 2020, as amended. Turquoise Hill was not a party to that arbitration, but the GOM Defence and Counterclaim requested that the arbitral tribunal add both Turquoise Hill and a member of the Rio Tinto Group as parties to the tax arbitration. The principal thrust of the GOM Defence and Counterclaim is to seek the rejection of Oyu Tolgoi’s tax claims in their entirety. As part of the counterclaim, the Government of Mongolia makes assertions surrounding previously reported allegations of historical improper payments made to Government of Mongolia officials and seeks unquantified damages. Also, in the event Oyu Tolgoi’s tax claims are not dismissed in their entirety, the Government of Mongolia is seeking in the counterclaim an alternative declaration that the 2009 Investment Agreement is void. Turquoise Hill denied the allegations relating to the Company in the GOM Defence and Counterclaim and filed submissions to the arbitral tribunal to oppose the Government of Mongolia’s request that it be added to the tax arbitration. As announced by the Company on January 17, 2022, the arbitral tribunal issued a ruling deciding that Turquoise Hill not be added as a party to the arbitration. On December 30, 2021, the Parliament of Mongolia passed a resolution (“Resolution 103”) authorizing certain measures to be completed by the Government of Mongolia in order for Resolution 92 to be considered formally implemented. As announced by the Company on January 24, 2022, the Company remains committed to continue the work with the Government of Mongolia and Rio Tinto to finalize the remaining outstanding matters of Resolution 103, including resolution of the outstanding tax arbitration. On February 11, 2022, at the request of the parties to the tax arbitration, the arbitral tribunal issued an order suspending the tax arbitration for six months or until 21 days from when the tribunal receives notice from Oyu Tolgoi LLC or the Government of Mongolia to terminate the suspension (refer to Note 26 – Subsequent events). Management remains of the opinion that the tax positions adopted by Oyu Tolgoi in its tax filings were correct and that Oyu Tolgoi has paid all taxes and charges as required under the Investment Agreement, ARSHA, the UDP and Mongolian law. In the opinion of the Company, at December 31, 2021, a provision is not required for the amounts disputed by the Company under arbitration proceedings relating to the years 2013 through 2015. In addition, a provision is not required for the amounts disputed under the arbitration proceedings relating to the years 2016 through 2018, any reduction in available carried forward losses or any additional amounts related to 2019 through December 31, 2021. The final amount of taxes to be paid depends on a number of factors, including the outcome of discussions with the Government of Mongolia and the outcome of the international arbitration proceedings. Changes in management’s assessment of the outcome of this matter could result in material adjustments to the Company’s statements of income and financial position. (c) Power Source Framework Agreement Oyu Tolgoi is obliged under the 2009 Oyu Tolgoi Investment Agreement to secure a long-term domestic source of power for the Oyu Tolgoi mine. The Power Source Framework Agreement (PSFA) entered into between Oyu Tolgoi and the Government of Mongolia on December 31, 2018 provides a binding framework and pathway for long-term power supply to the Oyu Tolgoi mine. The PSFA originally contemplated the construction of a power plant at Tavan Tolgoi (TTPP), which would be majority-owned by Oyu Tolgoi and situated close to the Tavan Tolgoi coal mining district located approximately 150 kilometres from the Oyu Tolgoi mine. In April 2020, the Government of Mongolia advised that it was unwilling to support Oyu Tolgoi’s proposal to develop TTPP and announced its intention to fund and construct a State-owned Power Plant (SOPP) at Tavan Tolgoi. On June 26, 2020, Oyu Tolgoi and the Government of Mongolia amended the PSFA (PSFA Amendment) to reflect their agreement to jointly prioritise and progress SOPP, in accordance with and subject to agreed milestones, as the domestic source of power for the Oyu Tolgoi mine. The PSFA Amendment provides that if certain agreed milestones are not met in a timely manner (subject to extension for Delay Events as defined) then Oyu Tolgoi will be entitled to select from, and implement, the alternative power solutions specified in the PSFA (as amended), comprising an Oyu Tolgoi-led In relation to the PSFA Amendment that was executed in , the first PSFA Amendment milestones (execution of the extension of the IMPIC supply arrangements, execution of the SOPP PPA and start of SOPP construction) were not met by the original dates of March , , March , and July , respectively. Oyu Tolgoi continued to engage with the Ministry of Energy at a sub-working While the Mongolian grid prepares to connect the Oyu Tolgoi mine, OT LLC expects to continue to import its power from Inner Mongolia, China. As at December 31, 2021, the Company had no capital commitments related to the PSFA Amendment. (d) Class Action Complaints In October 2020, a class action complaint was filed in the U.S. District Court, Southern District of New York against the Company, certain of its current and former officers as well as Rio Tinto and certain of its officers. The complaint alleges that the defendants made material misstatements and material omissions with respect to, among other things, the schedule, cost and progress to completion of the development of Oyu Tolgoi in violation of Section 10(b) of the U.S. Securities Exchange Act of 1934, as amended (the Exchange Act) and Rule 10b-5 In January 2021, a proposed class action was initiated in the Superior Court in the District of Montreal against the Company and certain of its current and former officers. An amended complaint was filed on July 27, 2021 which did not substantially alter the claim. The claim alleges that the Company and its current and former officers named therein as defendants made material misstatements and material omissions with respect to, among other things, the schedule, cost and progress to completion of Oyu Tolgoi, in violation of, among other things, sections 225.8, 225.9 and 225.11 of the Securities Act (Quebec). On January 7, 2022 the plaintiff re-amended Due to the size, complexity and nature of Turquoise Hill’s operations, various legal and tax matters arise in the ordinary course of business. Turquoise Hill recognizes a liability with respect to such matters when an outflow of economic resources is assessed as probable and the amount can be reliably estimated. In the opinion of management, these matters will not have a material effect on the consolidated financial statements of the Company. |
Financial instruments and fair
Financial instruments and fair value measurements | 12 Months Ended |
Dec. 31, 2021 | |
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Financial instruments and fair value measurements | 24. Financial instruments and fair value measurements Certain of the Company’s financial assets and liabilities are measured at fair value on a recurring basis and classified in their entirety based on the lowest level of input that is significant to the fair value measurement. Certain non-financial non-recurring The fair value of financial assets and financial liabilities measured at amortized cost is determined in accordance with accepted pricing models based on discounted cash flow analysis or using prices from observable current market transactions. Except as otherwise specified, the Company considers that the carrying amount of cash, other receivables, trade payables and other financial assets measured at amortized cost approximates their fair value because of the demand nature or short-term maturity of these instruments. The following tables provide an analysis of the Company’s financial assets that are measured subsequent to initial recognition at fair value on a recurring basis, grouped into Level 1 to 3 based on the degree to which the significant inputs used to determine the fair value are observable. · Level 1 fair value measurements are those derived from quoted prices in active markets for identical assets or liabilities. · Level 2 fair value measurements are those derived from inputs other than quoted prices included within Level 1, that are observable either directly or indirectly. · Level 3 fair value measurements are those derived from valuation techniques that include significant inputs that are not based on observable market data. Fair Value at December 31, 2021 Total Level 1 Level 2 Level 3 Money market funds (a) $ 193,243 $ 193,243 $ - $ - Marketable securities (a) 9,323 9,323 - - Trade receivables (b) 13,645 - 13,645 - Commodity put options (c) 109 - 109 - $ 216,320 $ 202,566 $ 13,754 $ - Fair Value at December 31, 2020 Total Level 1 Level 2 Level 3 Money market funds (a) $ 667,542 $ 667,542 $ - $ - Marketable securities (a) 6,379 6,379 - - Trade receivables (b) 50,459 - 50,459 - $ 724,380 $ 673,921 $ 50,459 $ - (a) The Company’s money market funds and marketable securities are classified within level 1 of the fair value hierarchy as they are valued using quoted market prices in active markets. (b) Trade receivables from provisionally priced concentrate sales are included in level 2 of the fair value hierarchy as the basis of valuation uses quoted commodity prices. (c) In 2021 the Company purchased copper and gold put options to establish a synthetic copper and gold price floor in order to provide increased certainty around the Company’s liquidity horizon. During the year ended December 31, 2021 the Company recognized a realized loss of $23.9 million and an unrealized loss of $5.9 million within Other income ( expenses ) in the consolidated statement of income, and a financial asset of $0.1 million within current Other financial assets in the consolidated balance sheet as at December 31, 2021. Commodity put options are included in level 2 of the fair value hierarchy as the basis of valuation uses quoted prices. Financial risk management Certain of the Company’s activities expose it to a number of financial risks, which include liquidity risk, foreign exchange risk, interest rate risk, credit risk and commodity price risk. During the year ended December 31, 2021, the Company purchased copper and gold put options to establish a synthetic copper and gold price floor in order to provide increased certainty around the Company’s liquidity horizon. In the event of a significant downturn in the price of copper or gold, the expected revenues to be received by the Company for either commodity would have a floor on the portion of associated production and help provide additional certainty with respect to the Company’s expectation of having sufficient liquidity to meet its requirements, including its operations and underground development. Liquidity risk Liquidity risk is the risk that the Company will not be able to meet its obligations The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted and include contractual interest payments. Interest payments on variable interest rate loans reflect interest rates at the reporting date and these amounts may change as market interest rates change. Refer to additional disclosures around liquidity risk in Note 1. Between 1 At December 31, 2021 Less than 1 year and 5 years After 5 years Total Carrying amount Non-derivative Trade and other payables $ 384,488 $ - $ - $ 384,488 $ 384,488 Expected lease liability 10,727 20,752 306 31,785 25,435 Borrowings 564,742 3,059,498 1,373,049 4,997,289 4,157,344 Total $ 959,957 $ 3,080,250 $ 1,373,355 $ 5,413,562 $ 4,567,267 Between 1 At December 31, 2020 Less than 1 year and 5 After 5 years Total Carrying amount Non-derivative Trade and other payables $ 390,059 $ - $ - $ 390,059 $ 390,059 Expected lease liability 1,121 19,631 205 20,957 16,868 Borrowings 204,035 2,935,929 2,048,916 5,188,880 4,184,911 Total $ 595,215 $ 2,955,560 $ 2,049,121 $ 5,599,896 $ 4,591,838 Foreign exchange risk The Company operates on an international basis and therefore foreign exchange risk exposures arise from transactions not denominated in U.S. dollars, its functional currency. The Company is only exposed to foreign exchange risk on its trade payables and accrued liabilities not denominated in U.S. dollars. As at December , , the effect on income for the year of a % strengthening in the Mongolian Tugrik against the U.S. dollar, with all other variables held constant, would be a charge of $ million $ million). Interest rate risk Interest rate risk is the risk that the value of a financial instrument or cash flows associated with the instrument will fluctuate due to changes in market interest rates. As at December 31, 2021, The Company is exposed to interest rate risk on its third-party project finance borrowings, the majority of which are at variable rates. As at December 31, 2021, the effect on income for the year of a 100 basis point increase in LIBOR interest rates, with all other variables held constant, would be a charge of $41.5 million (2020 – $40.7 million). Cash and cash equivalents have limited interest rate risk due to their short-term nature and receive interest based upon market interest rates or rates equivalent to those offered by financial institutions. As at December 31, 2021, the effect on income would not be significant. Credit risk Credit risk is the risk that a counterparty will not meet its obligations under a financial instrument or customer contract, leading to a financial loss. The Company is exposed to credit risk from its operating activities (primarily from customer receivables) and from its financing activities, including deposits with (and / or receivables from) banks and other financial institutions, other short term liquid investments and other financial instruments. The Company manages its customer credit risk subject to the Company’s established policy, procedures and controls relating to customer credit risk management. Credit limits are established for all customers based on internal or external rating criteria. The Company deposits its cash and cash equivalents with high credit quality counterparties as referenced by ratings agencies. The Company’s maximum balance sheet exposure to credit risk at December 31, 2021 is the carrying value of its cash and cash equivalents, and its trade and other receivables (refer to Note 1). Expected credit losses on trade and other receivables do not have a material impact on the Company’s consolidated financial statements at December 31, 2021. Commodity price risk The Company is exposed to commodity price risk from fluctuations in market prices of the commodities that the Company produces. Copper concentrate is “provisionally priced” whereby the selling price is subject to final adjustment at the end of a period normally ranging from to days after delivery to the customer as defined in the sales contract. The final price is based on the market price at the relevant quotation point stipulated in the contract. At each reporting date, the receivable is re-measured at its fair value based on the forward selling price for the quotation period stipulated in the contract. As at December , , the Company had thousand tonnes thousand tonnes) of copper in concentrate sales that were provisionally priced. The Company does not have a material exposure to commodity price risk on its provisionally priced copper in concentrate sales at December , . Capital risk management The Company’s objectives when managing capital risk are to safeguard its ability to continue as a going concern, to provide an adequate return to shareholders and to support any growth plans. The Company considers its capital to be share capital and third-party borrowings. To effectively manage capital requirements, the Company has in place a planning and budgeting process to help determine the funds required to ensure the Company has the appropriate liquidity to meet its operating needs. The Company seeks to ensure that there is sufficient borrowing capacity and cash to meet its short-term business requirements, taking into account its anticipated cash flows from operations and its holdings of cash and cash equivalents. Refer to additional disclosures around capital risk management in Note 1. |
Key management compensation
Key management compensation | 12 Months Ended |
Dec. 31, 2021 | |
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Key management compensation | 25. Key management compensation The compensation for key management, which comprises Turquoise Hill’s directors, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, and Chief Legal Officer in respect of employee services is as follows: Year 2021 2020 Salaries, director fees and other short term benefits $ 6,776 $ 3,186 Post-employment benefits 193 293 Share based payment 1,412 1,628 $ 8,381 $ 5,107 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2021 | |
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Subsequent Events | 26. Subsequent events On January 24, 2022 the Company announced the start of underground mine operations at Oyu Tolgoi, a renewed partnership with the Government of Mongolia and agreement with Rio Tinto on the Amended HOA, the latter providing a comprehensive funding arrangement to address the Company’s estimated funding requirements. In conjunction with this announcement, the board of directors of Oyu Tolgoi LLC (“Oyu Tolgoi”) unanimously approved: ● commencement of the undercut, namely commencement of blasting that will start the Oyu Tolgoi underground mine production; ● the start of formal discussions with Senior Project Finance lenders in relation to the Amended HOA; and ● signing of an Electricity Supply Agreement to provide Oyu Tolgoi with a long-term source of power from the Mongolian grid on terms fully agreed with the Government of Mongolia. (a) Commencement of undercutting Following the announcements on January 24, 2022, Oyu Tolgoi started operations at the Oyu Tolgoi underground mine on January 25, 2022 with the commencement of blasting to begin caving operations and the start of Oyu Tolgoi underground mine production. With the successful completion of this milestone, the Company continues to expect that the underground mine will achieve sustainable production for Panel 0 in the first half of 2023. Oyu Tolgoi has notified the senior project finance lenders that the commencement of undercutting the underground mine may constitute an event of default under the Common Terms Agreement as a material amendment to the Mine Plan that existed at the time project finance was secured and could indirectly result in Oyu Tolgoi’s inability to meet the original project completion longstop date specified in the project finance agreements. This potential event of default does not impact the existing repayment schedule for project finance debt but would allow the project finance lenders to restrict further drawdown of any funds that are still available – see Note 15 (a). Oyu Tolgoi has sent a waiver request in relation to this potential event of default to Sumitomo Mitsui Banking Corporation in their capacity as Intercreditor Agent. (b) Agreement with Rio Tinto on an Amended and Restated Heads of Agreement Turquoise Hill and Rio Tinto entered into an Amended HOA on January 24, 2022, replacing the prior Heads of Agreement dated April 9, 2021. This Amended HOA is binding and delineates a comprehensive funding arrangement to address the Company’s estimated incremental funding requirements. Key elements of the Amended HOA include: ● pursuing the rescheduling of principal repayments of existing debt (“Re-profiling”) ● seeking to raise up to $500 million of senior supplemental debt (“SSD”); ● Rio Tinto committing to provide a co-lending Re-profiling ● Rio Tinto committing to provide a short-term secured advance directly to the Company by way of one or more secured advances up to a maximum of $300 million, which would be available during the debt funding restriction period i in Resolution 103 and would be indirectly repaid out of the proceeds of the million co-lending facility; and ● the Company agreeing to conduct an equity offering in a form of its choosing of at least $650 million (including a Rio Tinto pro rata participation) by no later than August 31, 2022. ● In the event that additional funding was required, the Amended HOA provides that, if necessary, Turquoise Hill could be required to $1.5 billion (less the amount raised in the initial equity offering) via equity in a form of its choosing. (c) Electricity Supply Agreement On January 26, 2022, Oyu Tolgoi entered into an Electricity Supply Agreement (ESA) with, amongst others, Southern Region Electricity Distribution Network (SOJSC) to provide Oyu Tolgoi with power from the Mongolian grid. Power will be delivered pursuant to the ESA once certain technical conditions are satisfied. The ESA has a term of 20 years from the date on which supply commences and provides a pathway to meeting Oyu Tolgoi’s long-term power requirements from domestic power sources. While the Mongolian grid undergoes an upgrade to be in a position to provide stable and reliable power to the Oyu Tolgoi mine, Oyu Tolgoi will continue to import its power from Inner Mongolia, China. An z (d) Key terms agreed with the Government of Mongolia As part of the agreements with the Government of Mongolia, Turquoise Hill waived in full the US$2,363 million non-recourse Turquoise Hill’s funding of common share investments in Oyu Tolgoi on behalf of Erdenes took the form of non-recourse Further, the parties have also agreed to improve cooperation with EOT in monitoring the OT underground development and enhancing ESG matters. (e) Suspension of tax arbitration As announced by the Company on January 17, 2022, the arbitral tribunal issued a ruling deciding that Turquoise Hill would not be added as a party to the arbitration. On February 11, 2022, the arbitral tribunal issued a Partial Award confirming its earlier ruling that Turquoise Hill not be added as a party to the tax arbitration. On the same day, at the request of the parties to the tax arbitration, the arbitral tribunal issued an order suspending the tax arbitration for six months or until 21 days from when the tribunal receives notice from Oyu Tolgoi LLC or the Government of Mongolia to terminate the suspension. |
Summary of significant accoun_2
Summary of significant accounting policies (Policies) | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Statement of compliance | (a) Statement of compliance These consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”) as issued by the International Accounting Standards Board (“IASB”). These consolidated financial statements have been prepared on a going concern basis, and in making the assessment that the Company is a going concern, management have taken into account all available future information, which extends for a period of at least 12 months from December 31, 2021. Refer to Note 1. |
Change in accounting policies | (b) Change in accounting policies A number of new standards, and amendments to standards and interpretations, are effective as of January 1, 2021, and have been applied in preparing these consolidated financial statements. None of these standards and amendments to standards and interpretations had a significant effect on the consolidated financial statements of the Company. |
Areas of judgement and estimation uncertainty | (c) Areas of judgement and estimation uncertainty The preparation of consolidated financial statements in accordance with IFRS often requires management to make estimates about, and apply assumptions or subjective judgement to, future events and other matters that affect the reported amounts of the Company’s assets, liabilities, revenues, expenses and related disclosures. Assumptions, estimates and judgements are based on historical experience, expectations, current trends and other factors that management believes to be relevant at the time the Company’s consolidated financial statements are prepared. With the emergence of the new and more transmissible Omicron variant in Mongolia and elsewhere, COVID-19 non-governmental COVID-19. By their very nature, COVID-19 (i) Sources of estimation uncertainty Key sources of estimation uncertainty that have a risk of resulting in a material adjustment to the carrying amount of assets and liabilities within the next twelve months are summarized below: Going concern assessment The Company has made judgements, based on an internally generated short-term cash flow forecast, in concluding that there are no material uncertainties related to events or conditions that may cast significant doubt upon the Company’s ability to continue as a going concern. The short term cashflow forecast includes plans to access additional sources of funding under the amended HOA where management consider implementation of those plans to be probable. Judgements and estimates are made in forming assumptions of future activities, future cash flows and timing of those cash flows, including cash flows relating to the financing plans for re-profiling Recoverable amount of property, plant and equipment When there is an indicator of impairment or impairment reversal, the recoverable amount is assessed by reference to the higher of value in use (“VIU”) and fair value less costs of disposal (“FVLCD”). The VIU is the net present value of expected future pre-tax post-tax life-of-mine These inputs are based on the Company’s best estimates of what an independent market participant would consider appropriate. Changes to these inputs may alter the results of the test for impairment or impairment reversal, the amount of the impairment charge or impairment reversal recorded in the consolidated statement of income and the resulting carrying value of property, plant and equipment . An indicator of impairment was identified during the year ended December 31, 2021, and an assessment of recoverable amount was undertaken as at December 31, 2021; refer to Note 13. Recovery of deferred tax assets in Mongolia The Company assesses the recoverability of deferred tax assets at each reporting period-end Reserves and Resources Estimates of mineral reserves and resources are based on various assumptions relating to operating matters set forth in National Instrument 43-101. cut-off 43-101 Estimated mineral reserves and, in certain circumstances, resources are used to determine the depreciation of property, plant and equipment; to account for capitalized deferred stripping costs; to perform, when required, assessments of the recoverable amount of property, plant and equipment; as an input to the projection of future taxable profits which support assessments of deferred income tax recoverability; and to forecast the timing of the payment of decommissioning obligations. Depletion and depreciation of property, plant and equipment Property, plant and equipment is the largest component of the Company’s assets and, as such, the depreciation of these assets has a significant effect on the Company’s financial statements. Mining plant and equipment and other capital assets are depreciated over their expected economic lives using either the units of production method or the straight-line method. Depletion of each mineral property interest is provided on the units of production basis using estimated proven and probable reserves as the depletion basis. A change in the estimated useful life or residual value of a long-lived asset would result in a change in the rate of depreciation for that asset. For long-lived assets that are depleted or depreciated over proven and probable reserves using the units of production method, a change in the original estimate of proven and probable reserves would result in a change in the rate of depletion or depreciation. Decommissioning Costs The estimate of decommissioning costs is based on future expectations in the determination of closure provisions. Management makes a number of assumptions and judgements including estimating the amount of future reclamation costs and their timing, inflation rates and risk-free discount rates. These assumptions are formed based on environmental and regulatory requirements and the Company’s internal policies. The costs are more uncertain the further into the future the mine closure activities are to be carried out. Actual costs incurred in future periods in relation to the remediation of the Company’s existing assets could differ materially from their estimated undiscounted future value. Refer to Note 17 for the Company’s total decommissioning obligations recorded in the consolidated financial statements, the undiscounted values and the rate used to discount the liability. Net realizable value of inventories Ore stockpile inventory is valued at the lower of weighted average cost and net realizable value (“NRV”). If ore stockpiles are not expected to be processed within the 12 months after the balance sheet date, they are included within non-current (ii) Areas of judgement Impairment indicator of property, plant and equipment Judgement is required in assessing whether certain factors would be considered an indicator of impairment or impairment reversal. Management considers both internal and external information to determine whether there is an indicator of impairment and, accordingly, whether impairment testing is required. The information considered in assessing whether there is an indicator of impairment includes, but is not limited to, long-term commodity prices, the Company’s market capitalization relative to its net asset carrying amount, life of mine plans and changes in significant assumptions including reserves and resources, development capital estimates and scheduling and mine designs. The Company’s assessment for the year ended December 31, 2021 considered the approval by the Oyu Tolgoi board of directors of the operating program and budget for the 2022 financial year, including over $780 million to cover capital plans relating to the Oyu Tolgoi underground project, which will allow continued progression towards undercutting. The Company’s assessment also considered the information included within its announcement on January 17, 2022, in relation to its fourth quarter 2021 production and in which the Company provided an update on the Oyu Tolgoi mine and the status of negotiations with the Government of Mongolia as at December 31, 2021. The Company’s assessment also considered the information included within its January 17, 2022 announcement regarding the ongoing COVID-19 COVID-19 The Company’s assessment also considered the status of negotiations between the Company, Rio Tinto and the Government of Mongolia as at December 31, 2021. On December 30, 2021, the Mongolian Parliament passed Parliamentary Resolution 103 to authorize the Government of Mongolia to take certain measures in connection with Oyu Tolgoi, restricting additional shareholder or third-party debt financing at the Oyu Tolgoi level until commencement of sustainable production. The effect of the resolution required key negotiations to continue into 2022. Despite the positive progress made through the negotiations in 2021, management concluded that the potential for further delays and the resulting uncertainty as to the timing of underground project completion constituted an indicator of impairment at the Oyu Tolgoi cash generating unit level at December 31, 2021. Subsequent to year-end, Income taxes - provision for income taxes and composition of deferred income tax assets and liabilities The Company must make significant estimates in respect of the provision for income taxes and the composition of its deferred income tax assets and deferred income tax liabilities. The Company’s operations are, in part, subject to foreign tax laws where interpretations, regulations and legislation are complex and can be subject to change. As a result, there are usually some tax matters in question which may, on resolution in the future, result in adjustments to the amount of current or deferred income tax assets or liabilities, and those adjustments may be material to the Company’s balance sheet and results of operations. The Company recognizes potential liabilities and records tax liabilities for uncertain tax positions based on its judgement of whether, and the extent to which, additional taxes will be due. Consistent with IFRIC 23, Uncertainty Over Income Tax Treatments, Income taxes – utilization of tax losses carried forward The determination of the ability of the Company to utilize tax losses carried forward to offset income taxes payable in the future and to utilize temporary differences which will reverse in the future requires management to exercise judgement and make assumptions about the Company’s future performance. Management is required to assess whether it is probable that the Company is able to benefit from these tax losses and temporary differences. |
Basis of consolidation | (d) Basis of consolidation The financial statements consist of the consolidation of intercompany transactions and balances between Turquoise Hill and its subsidiaries have been eliminated on consolidation. Where necessary, adjustments are made to assets, liabilities, and results of subsidiaries to bring their accounting policies into line with those used by the Company. Subsidiaries are entities controlled by Turquoise Hill. The financial statements of subsidiaries are included in the consolidated financial statements from the date that control commences until the date that control ceases. The Company controls an entity if it has power to direct the activities of the entity in a manner that significantly affects its returns, has exposure or rights to variable returns from its involvement with the entity and has the ability to use its power to affect those returns. The Company consolidates all subsidiaries. The Company’s principal operating subsidiary is Oyu Tolgoi. Wholly owned subsidiaries of Turquoise Hill together hold a 66.0% interest in Oyu Tolgoi, whose principal asset is the Oyu Tolgoi copper-gold mine located in Southern Mongolia. The remaining 34% non-controlling interest in Oyu Tolgoi is owned by Erdenes Oyu Tolgoi LLC (“Erdenes”), a company controlled by the Mongolian government. The Company has historically funded 100% of the Oyu Tolgoi copper-gold mine’s exploration and development costs via equity and debt investments in Oyu Tolgoi and non-recourse loans to Erdenes. Income or loss of Oyu Tolgoi is attributed to the controlling and non-controlling shareholders based on ownership percentage. Non-recourse loans advanced to Erdenes upon the issuance of additional equity interests to Erdenes are accounted for separately and recorded as an offset to non-controlling interest in equity. Unrealized interest on the non-recourse loans to Erdenes, which are recoverable principally through dividends from Oyu Tolgoi or sale by Erdenes of its interests in Oyu Tolgoi, is recognized when payment of the interest can be reliably determined. Subsequent to December 31, 2021, the Company waived these non-recourse |
Currency translation and foreign exchange | (e) Currency translation and foreign exchange The Company has determined the U.S. dollar to be the functional currency of Turquoise Hill and its significant subsidiaries as it is the currency of the primary economic environment in which Turquoise Hill and all of its significant subsidiaries operate. Accordingly, monetary assets and liabilities denominated in foreign currencies are translated into U.S. dollars at the exchange rate in effect at the date of the balance sheet and non-monetary |
Revenue | (f) Revenue The Company generates revenue from the sale of concentrate containing copper, gold and silver. Sales revenue is recognized on individual sales to depict the transfer of promised goods to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those goods. The Company considers five steps in assessing whether all of the revenue recognition criteria are met: · identify the contract with a customer; · identify the performance obligations in the contract; · determine the transaction price; · allocate the transaction price to performance obligations; and · recognize revenue when or as a performance obligation is satisfied. The Company satisfies its performance obligation and sales revenue is recognized at the point in time when the product is delivered as specified by the customer, which is typically upon loading of the product to the customer’s truck, train or vessel. The Company considers that control has passed when there is a present obligation to pay from the customer’s perspective; physical possession, legal title and the risks and rewards of ownership have all passed to the customer; and the customer has accepted the concentrate. The Company recognizes deferred revenue in the event it receives payment from a customer before a sales transaction meets all the criteria for revenue recognition. Concentrate is provisionally priced whereby the selling price is subject to final adjustment at the end of a period normally ranging from 30 to 180 days after delivery to the customer as defined in the sales contract. The final price is based on the market price at the relevant quotation point stipulated in the Mining royalties paid to the government of Mongolia are included in operating expenses. |
Exploration and evaluation | (g) Exploration and evaluation All direct costs related to the acquisition of mineral property interests are capitalized in the period incurred. Exploration and evaluation costs are charged to operations in the period incurred until such time as it has been determined that a mineral property has proven and probable reserves and the property is economically viable, in which case subsequent evaluation costs incurred to develop a mineral property are capitalized. Exploration and evaluation costs include value-added taxes incurred in foreign jurisdictions when recoverability of those taxes is uncertain. |
Property, plant and equipment | (h) Property, plant and equipment Property, plant and equipment are recorded at cost, less accumulated depletion and depreciation and accumulated impairment losses. The cost of property, plant and equipment includes the estimated close down and restoration costs associated with the asset. Once an undeveloped mining project has been established as commercially viable, including that it has established proven and probable reserves and approval to mine by governmental authorities has been given, expenditure (including qualifying exploration and evaluation costs) other than on land, buildings, plant and equipment is capitalized under “Mineral property interests.” Ore reserves may be declared for an undeveloped mining project before its commercial viability has been fully determined and approval to mine has been given. Evaluation costs may be capitalized during the period between declaration of reserves and approval to mine as further work is undertaken in order to refine the development case to maximize the project’s return. Project development expenditures, including costs to acquire and construct buildings and equipment are capitalized under “Capital works in progress” provided that the project has been established as commercially viable. Capital works in progress are not categorized as mineral property interests, mining plant and equipment or other capital assets until the capital asset is in the condition and location necessary for its intended use. Sales of concentrate and associated costs, which are incurred during the commissioning phase, that are necessary for the successful commissioning of new assets, are capitalized. Development costs incurred after the commencement of production are capitalized to the extent they are expected to give rise to a future economic benefit. Borrowing costs related to construction or development of a qualifying asset are capitalized until the point when substantially all the activities that are necessary to make the asset ready for its intended use are complete. Where funds have been borrowed specifically to finance an asset, the amount capitalized is the actual interest on borrowings incurred, net of any returns on invested funds. Where the funds used to finance an asset form part of general borrowings, the amount capitalized is calculated using a weighted average of rates applicable to relevant general borrowings of the Company during the period. |
Deferred stripping | (i) Deferred stripping In open pit mining operations, it is necessary to remove overburden and other waste materials to access ore from which minerals can be extracted economically. The process of mining overburden and waste materials is referred to as stripping. During the development of an open pit mine, before production commences, stripping costs are capitalized as part of mineral property interests and are subsequently amortized over the life of the mine on a units of production basis. During the production phase, stripping activity is undertaken for the dual purpose of extracting inventory for current production as well as improving access to the ore body. Stripping costs incurred for the purpose of extracting current inventories are included in the costs of inventory produced during the period the stripping costs are incurred. In order for production phase stripping costs to qualify for capitalization as a stripping activity asset, three criteria must be met: · it must be probable that economic benefit will be realized in a future accounting period as a result of improved access to the ore body created by the stripping activity; · it must be possible to identify the “component” of the ore body for which access has been improved; and · it must be possible to reliably measure the costs that relate to the stripping activity. When the cost of stripping related to development which has a future benefit is not distinguishable from the cost of producing current inventories, the stripping costs are allocated to each activity based on a relevant production measure. Generally, the measure would be calculated based on a ratio obtained by dividing the tonnage of waste mined for the component for the period by the quantity of ore mined for the component. Stripping costs incurred in the period related to the component are deferred to the extent that the current period ratio exceeds the historical life of component ratio. The stripping activity asset is depreciated on a units of production basis based on expected production of ore over the useful life of the component that has been made more accessible as a result of the stripping activity. The life of component ratios are based on proven and probable reserves based on the mine plan; they are a function of the mine design and therefore changes to that design will generally result in changes to the ratios. Changes in other technical or economic parameters that impact reserves may also impact the life of component ratios. Changes to the life of component ratios are accounted for prospectively. Deferred stripping costs are included in “Mineral property interests” within property, plant and equipment. Amortization of deferred stripping costs is included as a cost of production in the period. |
Depreciation and depletion | (j) Depreciation and depletion Property, plant and equipment is depreciated over its useful life, or over the remaining life of the mine if that is shorter. The useful lives of the major assets of a cash-generating unit are often dependent on the life of the ore body to which they relate. Where this is the case, the lives of mining properties, and their associated concentrators and other long lived processing equipment generally relate to the expected life of the ore body. The life of the ore body, in turn, is estimated on the basis of the life-of-mine Development costs that relate to a discrete section of an ore body, and which only provide benefit over the life of those reserves, are depreciated over the estimated life of that discrete section. Development costs incurred that relate to the entire ore body are depreciated over the estimated life of the entire ore body. Assets within operations for which production is not expected to fluctuate significantly from one year to another or which have a physical life shorter than the mine are depreciated on a straight-line basis. Depreciation commences when an asset is available for use. |
Impairment of non-current assets | (k) Impairment of non-current Property, plant and equipment is reviewed for impairment when events or changes in circumstances indicate that the full carrying amount may not be recoverable. Non-current assets that have previously been impaired are tested for possible reversal of the impairment whenever events or changes in circumstances indicate that the impairment may have reversed. Impairment is assessed at the level of cash-generating units which are identified as the smallest identifiable group of assets capable of generating cash inflows which are largely independent of the cash inflows from other assets. When an impairment review is undertaken, the recoverable amount is assessed by reference to the higher of VIU and FVLCD. The VIU is the net present value of expected future pre-tax The best evidence of FVLCD is often the value obtained from an active market or binding sale agreement. Where this is not the case, or where neither an active market nor a binding sale agreement exists, FVLCD is based on the best information available to reflect the amount a market participant would pay for the cash-generating unit in an arm’s length transaction. This is often estimated using discounted post tax cash flow techniques based on detailed life-of-mine The cash flow forecasts are based on management’s best estimates of expected future revenues and costs, including the future cash costs of production and capital expenditure, which for FVLCD purposes management believe approximate those of a market participant. Forecast cash flows for impairment purposes are generally based on management’s price forecasts of commodity prices, which assume short term observable market prices will revert to the Company’s assessment of the long term price, generally over a period of three to five years. These long-term forecast commodity prices are derived from industry analyst consensus. The discount rates applied to the future cash flow forecasts represent an estimate of the rate the market would apply having regard to the time value of money and the risks specific to the asset for which the future cash flow estimates have not been adjusted. |
Decommissioning obligations | (l) Decommissioning obligations The Company recognizes liabilities for statutory, contractual, legal or constructive obligations associated with the retirement of property, plant and equipment, when those obligations result from the acquisition, construction, development or normal operation of the assets. Initially, a provision for a decommissioning obligation is recognized at its net present value in the period in which it is incurred, using a discounted cash flow technique with market-based risk-free discount rates and estimates of the timing and amount of the settlement of the obligation. Upon initial recognition of the liability, the corresponding decommissioning cost is added to the carrying amount of the related asset. Following initial recognition of the decommissioning obligation, the carrying amount of the liability is increased for the passage of time and adjusted for changes to significant estimates including the current discount rate, the amount or timing of the underlying cash flows needed to settle the obligation and the requirements of the relevant legal and regulatory framework. Subsequent changes in the provisions resulting from new disturbance, updated cost estimates, changes to estimated lives of operations and revisions to discount rates are also capitalized to the related property, plant and equipment. Amounts capitalized to the related property, plant and equipment are depreciated over the lives of the assets to which they relate. The amortization or unwinding of the discount applied in establishing the net present value of provisions is charged to expense and is included within finance costs in the consolidated statement of income. |
Inventories | (m) Inventories Concentrate inventory is valued at the lower of weighted average cost and net realizable value. Cost comprises production and processing costs, which includes direct and indirect labour, operating materials and supplies, applicable transportation costs and apportionment of operating overheads, including depreciation and depletion. Net realizable value is the expected average selling price of the concentrate inventory less applicable selling and transportation costs. Stockpiles represent ore that has been extracted and is available for further processing. Stockpiles are valued at the lower of weighted average production cost and net realizable value. Production cost includes direct and indirect labour, operating materials and supplies, applicable transportation costs, and apportionment of operating overheads, including depreciation and depletion. Net realizable value is the expected average selling price of the finished product less the costs to get the product into saleable form and to the selling location. If the ore will not be processed and sold within 12 months after the consolidated balance sheet date it is included within non-current Mine stores and supplies are valued at the lower of the weighted average cost and net realizable value. |
Taxation | (n) Taxation Income tax expense comprises current and deferred tax. Current tax and deferred taxes are recognized in the consolidated statement of income except to the extent that they relate to items recognized directly in equity or in other comprehensive income. Current tax is the expected tax payable or receivable on the taxable income or loss for the year, using tax rates enacted or substantively enacted at the reporting date. Deferred tax is recognized in respect of unused tax losses and credits, as well as temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes. Deferred tax is measured at the tax rates that are expected to be applied to temporary differences when they reverse, based on enacted or substantively enacted laws at the reporting date. The Company computes the provision for deferred income taxes under the liability method. A deferred tax asset is recognized for unused tax losses, tax credits and deductible temporary differences, only to the extent that it is probable that future taxable profits will be available against which they can be utilized. Future taxable profits are estimated using an income forecast derived from cash flow projections, based on detailed life-of-mine Deferred tax is not recognized for the initial recognition of assets or liabilities in a transaction that is not a business combination and that affects neither accounting nor taxable profit or loss, and differences relating to investments in subsidiaries, associates and joint arrangements to the extent that it is probable that they will not reverse in the foreseeable future. The Company is subject to assessments by various taxation authorities, who may interpret tax legislation differently from the Company. The final amount of taxes to be paid depends on a number of factors, including the outcomes of audits, appeals or negotiated settlements. Such differences are accounted for based on management’s best estimate of the probable outcome of these matters. The Company must make significant estimates and judgements in respect of its provision for income taxes and the composition and measurement of its deferred income tax assets and liabilities. The Company’s operations are, in part, subject to foreign tax laws where interpretations, regulations and legislation are complex and subject to change. As a result, there are some tax matters in question that may, upon resolution in the future, result in adjustments to the amount of deferred income tax assets and liabilities; those adjustments may be material. |
Employee benefits | (o) Employee benefits Wages, salaries, contributions to government pension and social insurance funds, compensated absences and bonuses are accrued in the year in which the employees render the associated services. |
Cash and cash equivalents | (p) Cash and cash equivalents For the purposes of the consolidated balance sheet, cash and cash equivalents comprise cash on hand, demand deposits and short term, highly liquid investments with an initial maturity of three months or less that are readily convertible into known amounts of cash and which are subject to insignificant risk of changes in value. |
Financial instruments | (q) Financial instruments The Company classifies its financial instruments in the following categories: at fair value through profit or loss, fair value through other comprehensive income or at amortized cost. Classification The Company determines the classification of financial instruments at initial recognition. The classification of debt instruments is driven by the Company’s business model for managing the financial assets and their contractual cash flow characteristics. A debt instrument is measured at amortized cost if the objective of the business model is to hold the debt instrument for the collection of contractual cash flows, and the asset’s contractual cash flows are comprised solely of payments of principal and interest (“SPPI”). A debt instrument held under a business model under which financial assets may be either held to collect contractual cash flows or sold is classified as held at fair value through other comprehensive income if the SPPI criteria are met. Any other financial assets are classified at fair value through profit or loss. Debt instruments held to maturity are classified as current or non-current instrument-by-instrument Financial liabilities are measured at amortized cost, unless they are required to be measured at fair value through profit or loss (such as instruments held for trading or derivatives) or where the Company has opted to measure at fair value through profit or loss. Measurement (i) Financial assets and liabilities at fair value through profit or loss Financial assets and liabilities at fair value through profit or loss are initially recognized at fair value and transaction costs are expensed in the consolidated statements of income. Realized and unrealized gains and losses arising from changes in fair value are included in the consolidated statement of income in the period in which they arise. Where the Company has elected to recognize a financial liability at fair value through profit or loss, any changes associated with the Company’s own credit risk will be recognized in other comprehensive income. (ii) Financial assets at fair value through other comprehensive income Investments in equity instruments at fair value through other comprehensive income are initially recognized at fair value plus transaction costs. Subsequent to initial recognition, they are measured at fair value, with gains and losses recognized in other comprehensive income. (iii) Financial assets and liabilities at amortized cost Financial assets and liabilities at amortized cost are initially recognized at fair value net of transaction costs, and subsequently carried at amortized cost less any impairment charges. (iv) Derivative financial instruments Derivatives are classified as fair value through profit or loss. Derivatives embedded in financial liabilities are treated as separate derivatives when their risks and characteristics are not closely related to their host contracts. Commodity-based derivatives resulting from provisionally priced concentrate are classified as fair value through profit or loss with changes in value recognized in revenue. Impairment of financial assets The Company recognizes a loss allowance for expected credit losses on financial assets that are measured at amortized cost. At each reporting date, the Company measures the loss allowance for the financial asset at an amount equal to the 12 month expected credit loss for performing assets and the lifetime expected credit loss if the credit risk on the financial asset has increased significantly since initial recognition. For financial assets that are credit impaired at inception, the Company recognizes the expected lifetime credit loss allowance and any interest income is calculated on the net carrying amount. Impairment losses on financial assets carried at amortized cost are reversed in subsequent periods if the expected credit losses are reversed after the impairment was recognized. Derecognition Financial assets are derecognized when the investments mature or are sold, and substantially all the risks and rewards of ownership have been transferred. A financial liability is derecognized when the obligation under the liability is discharged, canceled or expired. Gains and losses on derecognition are recognized within finance income and finance costs, respectively. Gains or losses on equity instruments designated as fair value through other comprehensive income remain within accumulated other comprehensive income. |
Share based payments | (r) Share based payments The Company has a Performance Share Unit (“PSU”) Plan, a Restricted Share Unit (“RSU”) plan, and a Director Deferred Share Unit (“DDSU”) Plan. The PSUs, RSUs, and DDSUs are accounted for at fair value upon issuance and remeasured each reporting period, based on the fair market value of a common share of the Company, and recognized as an expense on a straight-line basis over the vesting period. |
Segment reporting | (s) Segment reporting An operating segment is a component of the Company that engages in business activities from which it may earn revenues and incur expenses, including revenues and expenses that relate to transactions with any of the Company’s other components. Operating segments are reported consistently with internal information provided to the chief operating decision maker (“CODM”). The CODM, who is responsible for allocating resources and assessing performance, has been identified as Turquoise Hill’s Chief Executive Officer. Based upon management’s assessment of the above criteria, the Company has one operating segment, Oyu Tolgoi, with its copper-gold mine in Southern Mongolia. |
Leases | (t) Leases At inception of the contract, the Company assesses whether a contract is, or contains, a lease. The contract contains a lease if it conveys the right to control the use of an identified asset for a period of time in exchange for consideration. To assess this, the Company considers whether: – The contract involves the use of an identified asset; – the Company has the right to obtain substantially all the economic benefits from use of the asset throughout the period of use; and – the Company has the right to direct the use of the asset. The Company recognizes a right of use asset and a lease liability at the lease commencement date. The right of use asset is initially measured at cost. The right of use asset is subsequently depreciated using the straight-line method from the commencement date to the end of the useful life or the end of the lease term. The estimated useful lives of right of use assets are determined on the same basis as those of property, plant and equipment. In addition, they are periodically reduced by any impairment losses and adjusted for certain re-measurements The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted at the weighted average incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise: fixed payments; variable lease payments that depend on an index or a rate; amounts expected to be payable under any residual value guarantee, and the exercise price under any purchase option that the Company would be reasonably certain to exercise; lease payments in any optional renewal period if the Company is reasonably certain to exercise an extension option; and penalties for any early termination of a lease unless the Company is reasonably certain not to terminate early. The lease liability is measured at amortized cost using the effective interest rate method. It is re-measured When the lease liability is re-measured The Company presents right of use assets in Property, plant, and equipment and lease liabilities in Borrowings and other financial liabilities in the consolidated balance sheet. |
New standards and interpretations not yet adopted | (u) New standards and interpretations not yet adopted IAS 16, Property, Plant and Equipmen t Proceeds before Intended Use is em This amendment is effective for the Company’s annual reporting periods beginning January 1, 2022 with retrospective application required as it relates to items of property, plant and equipment that are brought to the location and condition necessary for them to be capable of operating in the manner intended by management on or after January 1, 202 1 The impact of adjustments to amounts recorded within opening balances at January 1, 2021 are expected to decrease the deficit reported within equity by $21 million and to increase capital work in progress within property, plant and equipment by $21 million. Upon adoption of the amendment for reporting periods starting from January 1, 2022, the restatement of the Company’s Consolidated Statement of Income and Consolidated Balance Sheet as at and for the year ended December 31, $70 million increase to revenue, a $15 million increase in cost of sales and a $55 million increase to capital work in progress within property, plant and equipment. |
Operating segment (Tables)
Operating segment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Operating Segments | Year Ended December 31, 2021 Corporate and other Oyu Tolgoi eliminations Consolidated Revenue $ 1,971,042 $ - $ 1,971,042 Cost of sales (622,329 ) - (622,329 ) Gross margin 1,348,713 - 1,348,713 Operating (expenses) income (321,257 ) 45,770 (275,487 ) Corporate administration expenses - (37,699 ) (37,699 ) Other expenses (7,575 ) (30,002 ) (37,577 ) Income (loss) before finance items and taxes 1,019,881 (21,931 ) 997,950 Finance items Finance income 1,783 1,215 2,998 Finance costs (282,606 ) 274,570 (8,036 ) Income from operations before taxes $ 739,058 $ 253,854 $ 992,912 Income and other taxes (279,559 ) (32,233 ) (311,792 ) Income for the year $ 459,499 $ 221,621 $ 681,120 Depreciation and depletion 165,269 97 165,366 Capital additions 1,263,698 - 1,263,698 Current assets 497,845 623,302 1,121,147 Non-current 13,375,066 (371,524 ) 13,003,542 Current liabilities 909,328 21,949 931,277 Non-current 12,443,023 (8,358,569 ) 4,084,454 Net increase (decrease) in cash 25,245 (454,570 ) (429,325 ) (a) The Oyu Tolgoi segment’s non- current non-current asset . Year Ended December 31, 2020 Corporate and other Oyu Tolgoi eliminations Consolidated Revenue $ 1,078,192 $ - $ 1,078,192 Cost of sales (669,394 ) - (669,394 ) Gross margin 408,798 - 408,798 Operating (expenses) income (245,718 ) 43,447 (202,271 ) Corporate administration expenses - (30,602 ) (30,602 ) Other income (expenses) 3,254 (2,772 ) 482 Income before finance items and taxes 166,334 10,073 176,407 Finance items Finance income 4,292 13,057 17,349 Finance costs (257,765 ) 252,255 (5,510 ) Income (loss) from operations before taxes $ (87,139) $ 275,385 $ 188,246 Income and other taxes 347,003 (40,607 ) 306,396 Income for the year $ 259,864 $ 234,778 $ 494,642 Depreciation and depletion 181,146 114 181,260 Capital additions 1,326,274 - 1,326,274 Current assets 431,271 1,077,598 1,508,869 Non-current 12,025,763 (165,871 ) 11,859,892 Current liabilities 501,013 20,623 521,636 Non-current 11,954,961 (7,535,789 ) 4,419,172 Net decrease in cash (38,563 ) (489,801 ) (528,364 ) (a) The Oyu Tolgoi segment’s non-current billion of shareholder loan and accrued interest liability and the Corporate and other elimination non-current billion of shareholder loan and accrued interest asset at December 31, 2020. |
Revenue (Tables)
Revenue (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Revenue | Year Ended December 31, 2021 Revenue from contracts with customers Other Total revenue Total revenue: Copper $ 1,151,118 $ 53,401 $ 1,204,519 Gold 754,345 (5,763 ) 748,582 Silver 18,127 (186 ) 17,941 $ 1,923,590 $ 47,452 $ 1,971,042 Year Ended December 31, 2020 Revenue from contracts with customers Other Total revenue Total revenue: Copper $ 755,874 $ 41,423 $ 797,297 Gold 260,055 5,593 265,648 Silver 14,575 672 15,247 $ 1,030,504 $ 47,688 $ 1,078,192 (a) Other revenue relates to gains (losses) on the revaluation of trade receivables. |
Cost of sales (Tables)
Cost of sales (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Cost of Sales | Year Ended December 31, 2021 2020 Production and delivery $ 459,322 $ 493,370 Depreciation and depletion 163,007 176,024 $ 622,329 $ 669,394 |
Operating expenses (Tables)
Operating expenses (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Operating Expenses | Year Ended December 31, 2021 2020 Oyu Tolgoi administration expenses $ 156,066 $ 124,889 Royalty expenses 105,399 63,420 Inventory reversals (a) (3,465 ) (2,703 ) Selling expenses 15,041 11,147 Depreciation 2,359 5,236 Other 87 282 $ 275,487 $ 202,271 (a) Inventory reversals include net adjustments to the carrying value of ore stockpile inventories and materials and supplies; refer to Note 9. |
Finance items (Tables)
Finance items (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Finance Items | Year Ended December 31, 2021 2020 Finance income: Interest income (a) $ 2,998 $ 17,349 $ 2,998 $ 17,349 Finance costs: Interest expense and similar charges $ (299,618 ) $ (340,040 ) Amounts capitalized to property, plant and equipment (b) 297,392 337,727 Accretion of decommissioning obligations (Note 17) (5,810 ) (3,197 ) $ (8,036 ) $ (5,510 ) (a) Finance income for the year ended December 31, 2021 does not include interest on the related party receivable. For the year ended December 31, 2020, f (b) The majority of the costs capitalized to property, plant and equipment were capitalized at the weighted average rate of the Company’s general borrowings of 8.1% (2020: 8.3%) (refer to Note 13). |
Cash and cash equivalents (Tabl
Cash and cash equivalents (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Schedule of Cash and Cash Equivalents | December 1 December 0 Cash at bank and on hand 101,745 $ 61,783 Money market funds 193,243 667,542 Other cash equivalents 399,308 394,296 $ 694,296 $ 1,123,621 |
Inventories (Tables)
Inventories (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Inventories | December 31, December 31, Current Concentrate $ 148,270 $ 48,504 Ore stockpiles 27,911 44,846 Materials and supplies 185,797 180,038 Provision against carrying value of materials and supplies (71,961 ) (75,426 ) $ 290,017 $ 197,962 Non-current Ore stockpiles $ 60,711 $ 37,557 $ 60,711 $ 37,557 |
Trade and other receivables (Ta
Trade and other receivables (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Trade and Other Receivables | December 31, December 31, Trade receivables from provisionally priced sales $ 13,645 $ 50,459 Other receivables 2,435 8,701 Due from related parties (Note 22) 39 852 $ 16,119 $ 60,012 |
Prepaid expenses and other as_2
Prepaid expenses and other assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Prepaid expenses and other assets | December 31, December 31, Current Prepaid Expenses: Prepaid expenses $ 38,881 $ 44,130 Amounts prepaid to related parties (Note 22) 81,725 83,144 $ 120,606 $ 127,274 Non-current Prepaid Mongolian corporate tax (Note 23) $ 348,171 $ - Other 500 - $ 348,671 $ - |
Other non-current financial a_2
Other non-current financial assets (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Other non-current financial assets | December 31, December 31, Current assets: Commodity put options $ 109 $ - $ 109 $ - Non-current Marketable securities $ 9,323 $ 6,379 Other 7,495 7,739 $ 16,818 $ 14,118 |
Property, plant and equipment (
Property, plant and equipment (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Property, Plant and Equipment | Oyu Tolgoi Year Ended December 31, 2021 Mineral Plant and Capital works Other capital Total Net book value: January 1, 2021 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Additions (a) 33,208 13,906 919,192 - 966,306 Interest capitalized (Note 7) - - 297,392 - 297,392 Changes to decommissioning obligations (Note 17) 13,888 - - - 13,888 Depreciation for the period (48,967) (181,405) - (97) (230,469) Disposals and write offs - (149) - - (149) Transfers and other movements - 148,720 (148,720) - - December 31, 2021 $ 693,681 $ 2,992,594 $ 8,287,366 $ 839 $ 11,974,480 Cost 1,350,231 5,023,101 8,652,073 1,131 15,026,536 Accumulated depreciation / impairment (656,550) (2,030,507 ) (364,707) (292) (3,052,056 ) December 31, 2021 $ 693,681 $ 2,992,594 $ 8,287,366 $ 839 $ 11,974,480 Non-current $ 693,681 $ 2,992,594 $ 8,287,366 $ - $ 11,973,641 Oyu Tolgoi Year Ended December 31, 2020 Mineral Plant and Capital works Other capital Total Net book value: January 1, 2020 $ 723,516 $ 3,126,331 $ 5,931,750 $ 1,050 $ 9,782,647 Additions (a) 5,965 - 982,582 - 988,547 Interest capitalized (Note 7) - - 337,727 - 337,727 Changes to decommissioning obligations (Note 17) 26,529 - - - 26,529 Depreciation for the period (60,458) (145,979) - (114) (206,551) Disposals and write offs - (858) (529) - (1,387) Transfers and other movements - 32,028 (32,028) - - December 31, 2020 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Cost 1,303,134 4,868,370 7,584,209 1,131 13,756,844 Accumulated depreciation / impairment (607,582) (1,856,848) (364,707) (195) (2,829,332) December 31, 2020 $ 695,552 $ 3,011,522 $ 7,219,502 $ 936 $ 10,927,512 Non-current $ 695,552 $ 3,011,522 $ 7,219,502 $ - $ 10,926,576 (a) Pre-production (b) In addition to property, plant and equipment, at December 31, 2021 current and non-current (c) Plant and equipment comprise owned and leased assets: |
Schedule of detailed information about property and plant equipment and leased assets | December 31, December 31, 2021 2020 Plant and equipment owned $ 11,961,967 $ 10,923,294 Right of use assets 12,513 4,218 $ 11,974,480 $ 10,927,512 The Company leases certain assets including warehouse and office facilities as well as transportation equipment, substantially all at Oyu Tolgoi. Information about leases for which the Company is a lessee is presented below: Year Ended December 31, Plant and equipment: 2021 2020 Opening Carrying Amount $ 4,218 $ 8,710 Additions 13,945 - Depreciation for the period (5,650 ) (4,492 ) $ 12,513 $ 4,218 |
Summary of quantitative information about right- of-use assets |
Trade and other payables (Table
Trade and other payables (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Trade and Other Payables | December 31, December 31, 2021 2020 Trade payables and accrued liabilities $ 320,791 $ 315,570 Interest payable on long-term borrowings 7,280 7,266 Payable to related parties (Note 22) 54,153 65,552 Other 2,264 1,671 $ 384,488 $ 390,059 |
Borrowings and other financia_2
Borrowings and other financial liabilities (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Detailed Information about Borrowings and Project Finance Facility | December 31, December 31, 2021 2020 Current liabilities: Project finance facility (a) $ 387,561 $ 27,567 Lease liabilities (b) 9,860 721 $ 397,421 $ 28,288 Non-current Project finance facility (a) $ 3,769,783 $ 4,157,344 Lease liabilities (b) 15,575 16,147 $ 3,785,358 $ 4,173,491 (a) Project finance facility On December 14, 2015, Oyu Tolgoi signed a $4.4 billion project finance facility. The facility is provided by a syndicate of international financial institutions and export credit agencies representing the governments of Canada, the United States and Australia, along with 15 commercial banks. The project finance lenders have agreed a debt cap of $6.0 billion. In addition to the funding drawn down to date there is an additional $0.1 billion available, subject to certain conditions (refer to Note 26 – Subsequent events), under the Company’s facility with the Export-Import Bank of the United States, and the potential for an additional $1.6 billion of supplemental debt in the future. Under the terms of the project finance facility held by Oyu Tolgoi, there are certain restrictions on the ability of Oyu Tolgoi to make shareholder distributions. Subsequent to December 31, 2021, Oyu Tolgoi notified its lenders of a potential event of default. Refer to Note 26. At December 31, 2021, Oyu Tolgoi has drawn down $ billion December 31, 2021 Original Annual interest rate Facility Carrying Value (i) Fair Value (i) Term (ii) Pre-completion Post-completion International Financial Institutions $ 775,836 $ 820,958 15 years LIBOR + 3.78% LIBOR + 4.78% Export Credit Agencies 865,801 921,116 14 years LIBOR LIBOR + 4.65% Loan 277,511 311,637 13 years 2.3% 2.3% MIGA Insured Loan (iii) 673,248 711,980 12 years LIBOR + 2.65% LIBOR Commercial Banks 1,564,948 1,672,455 12 years LIBOR + 3.4% LIBOR + 4.4% - B Loan Includes $50 million 15-year loan at A Loan rate $ 4,157,344 $ 4,438,146 (i) The carrying value of borrowings under the project finance facility differs from fair value due to amortized transaction costs, and changes in the estimate of fair value between the initial recognition date and the balance sheet date. Project finance borrowings were initially recognized at fair value less transaction costs on the relevant draw down dates, with aggregate initial fair value being $4,348.9 million before transaction costs. At December 31, 2021, these borrowings are stated net of $124.8 million unamortized transaction costs. At December 31, 2021, the fair value of the Company’s borrowings has been estimated with reference to a market yield, the variability of which is considered a reasonable indicator, over the pre-completion in-country pre-completion pre-completion (ii) The project finance facility provides for interest only payments for the first five years followed by minimum repayments according to a stepped amortization schedule for the remaining life of the facility. The maturity analysis of principal repayments is as follows: December 31, December 31, Maturity analysis - Project Finance facility (1) Less than one year $ 403,483 $ 43,489 One to five years 2,610,445 2,418,861 More than five years 1,268,212 1,863,279 $ 4,282,140 $ 4,325,629 (1) The rows are represented in dates as follows: As at December 31, 2021: 12 months to December 31, 2022; 48 months between January 1, 2023 and December 31, 2026; Beyond January 1, 2027. As at December 31, 2020: 12 months to December 31, 2021; 48 months between January 1, 2022 and December 31, 2025; Beyond January 1, 2026. (iii) The Multilateral Investment Guarantee Agency (“MIGA”) provides political risk insurance for commercial banks. The Company is required to pay an annual insurance premium of 1.4% of the MIGA Insured Loan for the remaining life of the facility. |
Summary of maturity principal repayments of borrowings | The maturity analysis of principal repayments is as follows: December 31, December 31, Maturity analysis - Project Finance facility (1) Less than one year $ 403,483 $ 43,489 One to five years 2,610,445 2,418,861 More than five years 1,268,212 1,863,279 $ 4,282,140 $ 4,325,629 (1) The rows are represented in dates as follows: As at December 31, 2021: 12 months to December 31, 2022; 48 months between January 1, 2023 and December 31, 2026; Beyond January 1, 2027. As at December 31, 2020: 12 months to December 31, 2021; 48 months between January 1, 2022 and December 31, 2025; Beyond January 1, 2026. |
Schedule of Lease Liabilities | (b) Lease liabilities December 31, December 31, Maturity analysis - contractual undiscounted cash flows (1) Less than one year $ 10,727 $ 1,121 One to five years 20,752 19,631 More than five years 306 205 Total undiscounted lease liabilities $ 31,785 $ 20,957 Lease liabilities included in the Consolidated balance sheet $ 25,435 $ 16,868 Current $ 9,860 $ 721 Non-Current $ 15,575 $ 16,147 (1) The rows are represented in dates as follows: As at December 31, 2021: 12 months to December 31, 2022; 48 months between January 1, 2023 and December 31, 2026; Beyond January 1, 2027. As at December 31, 2020: 12 months to December 31, 2021; 48 months between January 1, 2022 and December 31, 2025; Beyond January 1, 2026. |
Income taxes (Tables)
Income taxes (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Components of Tax Expenses and Benefit | (i) Current taxes In 2021, a cash payment of $0.2 million (2020 - $28.3 million) was made in respect of current taxes payable. Deferred tax liabilities for withholding taxes are reclassified to current tax prior to settlement. (ii) Deferred tax assets 2021 – Mongolia Deferred tax assets of $561.9 million were recognized at December 31, 2021 in Mongolia, comprised of $150.7 million relating to tax losses that expire if not recovered against taxable income within eight years and $411.2 million relating to accrued but unpaid interest expense and other temporary The Company recognized deferred tax assets at December 31, 2021 to the extent recovery is considered probable. In assessing the probability of recovery, future taxable income, derived from cash flows from detailed life-of-mine During the year ended December 31, 2021, the Company de de Thi s was partially offset by , which The adjustment to the previously recognized deferred tax asset for prior year losses and other temporary differences was due in part to the utilization of prior year losses carried forward against taxable income in the year combined with the changes made to mine plan operating assumptions, which led to an increase in the amount of loss carry forwards and temporary differences estimated to expire unutilized. 2020 – Mongolia Deferred tax assets of $841.3 million were recognized at December 31, 2020 in Mongolia, comprised of $389.3 million relating to tax losses that expire if not recovered against taxable income within eight years and $452.0 million relating to accrued but unpaid interest expense and other temporary differences. During the year ended December 31, 2020, the Company increased its recognized Mongolian deferred tax assets by $347.3 million. The movement in the Mongolian deferred tax asset represented an increase of $270.7 million in the recognized deferred tax asset for prior year losses and other temporary differences and an increase of $76.6 million related to current year activity. The adjustment to the Mongolian deferred tax was primarily due to an overall strengthening in taxable income forecasts during 2020 driven by improved commodity price projections and updated operating assumptions in mine planning and scheduling. The improvement in taxable income forecasts led to an increase in the amount of loss carry forwards and temporary differences estimated to be utilized prior to expiration. 2021 – Canada Deferred tax assets of $41.0 million were recognized at December 31, 2021 in Canada comprised of $39.5 million relating to non-capital in additional non-capital incurred in the year, only part of which is estimated to be utilized prior to expiration. Non-capital 2020 – Canada Deferred tax assets at December 31, 2020 were $39.4 non-capital (iii) Withholding taxes Withholding tax is accrued on interest owing on shareholder loans and recognized within deferred tax liabilities as interest accrues. Mongolian withholding tax will be due upon receipt of loan interest. |
Disclosure of Reconciliation of Average Effective Tax Rate and Applicable Tax Rate | (b) Reconciliation of income taxes calculated at the statutory rates to the actual tax provision Year Ended December 31, 2021 2020 Income (loss) from operations before taxes $ 992,912 $ 188,246 Tax at Canadian combined federal and provincial income tax rate (2021: 26.5%; 2020: 26.5%) 263,122 49,885 Tax effect of: Change in amount of deferred tax recognized 151,117 (276,945 ) Difference in tax rates and treatment in foreign jurisdictions (140,903 ) (116,208 ) Withholding taxes 33,717 32,537 Non deductible losses and expense 4,739 4,335 $ 311,792 $ (306,396 ) |
Summary of Deferred Tax Assets and Liabilities | Recognized and unrecognized deferred tax assets and liabilities are shown in the table below: Recognized Unrecognized December 31, December 31, December 31, December 31, 2021 2020 2021 2020 Deferred tax assets Non-capital $ 190,203 $ 427,695 $ 152,853 $ 281,643 Capital losses - - 117,517 117,945 Other temporary differences including accrued interest 412,659 453,010 319,227 63,471 $ 602,862 $ 880,705 $ 589,597 $ 463,059 Deferred tax liabilities (ii) Withholding tax (145,434 ) (111,717 ) - - $ (145,434 ) $ (111,717 ) $ - $ - (i) Unrecognized deferred tax assets relating to non-capital (ii) At December 31, 2021, the Company has not recognized a deferred tax liability on unremitted earnings in subsidiaries of In addition to the above, the Company has $812.1 December 31, 2021 (2020 – $812.1 million). Income taxes |
Decommissioning obligations (Ta
Decommissioning obligations (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Detailed Information about Decommissioning Obligations | Year Ended December 31, 2021 2020 Opening carrying amount $ 133,964 $ 104,238 Changes in estimates 13,888 26,529 Accretion of present value discount 5,810 3,197 $ 153,662 $ 133,964 |
Non-controlling interests (Tabl
Non-controlling interests (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Non-Controlling Interests in Subsidiaries | Non-controlling Oyu Tolgoi (a) Year Ended December 31, 2021 2020 Balance, January 1 $ (1,148,820 ) $ (1,237,174 ) Non-controlling income 156,230 88,354 Common share investments funded on behalf of non-controlling 20,400 137,700 Funded amounts repayable to the Company (a) (20,400 ) (137,700 ) Balance, December 31 $ (992,590 ) $ (1,148,820 ) (a) Since 2011, the Company has funded common share investments in Oyu Tolgoi on behalf of Erdenes. In accordance with the Amended and Restated Shareholders Agreement dated June 8, 2011, such funded amounts earn interest at an effective annual rate of LIBOR plus 6.5% and we d |
Cash flow information (Tables)
Cash flow information (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Reconciliation of Net Income (Loss) to Net Cash Flow Generated from Operating Activities and Other Non-cash Transactions | (a) Reconciliation of net income to net cash flow generated from operating activities before interest and tax Year Ended December 31, 2021 2020 Income (loss) for the year $ 681,120 $ 494,642 Adjustments for: Depreciation and amortization 165,366 181,260 Finance items: Interest income (2,998 ) (17,349 ) Interest and accretion expense 8,036 5,510 Unrealized foreign exchange (gain) loss 2,228 (4,297 ) Inventory write down reversals (3,465 ) (2,703 ) Write off of property, plant and equipment 87 282 Realized and unrealized losses on commodity put options 29,797 - Income and other taxes 311,792 (306,396 ) Other items 258 2,403 Net change in non-cash (Increase) decrease in: Inventories (109,212 ) (26,534 ) Trade, other receivables and prepaid expenses 52,148 (43,456 ) (Decrease) increase in: Trade and other payables 29,554 12,414 Deferred revenue 46,079 75,393 Cash generated from operating activities before interest and tax $ 1,210,790 $ 371,169 (b) Supplementary information regarding other non-cash The non-cash Year Ended December 31 2021 2020 Investing activities Change in accounts payable and accrued liabilities related to purchase of property, plant and equipment $ (40,022 ) $ (79,879) Additions to property, plant and equipment - leased assets 13,945 - |
Related parties (Tables)
Related parties (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Disclosure of Related Party Transactions by Financial Statement Line Item | As at December 31, 2021, Rio Tinto plc’s indirect equity ownership in the Company was 50.8% (December 31, 2020: 50.8%). The following tables present the consolidated financial statements line items within which transactions with a Rio Tinto entity or entities (“Rio Tinto”) are reported. Rio Tinto entities comprise Rio Tinto plc, Rio Tinto Limited and their respective subsidiaries other than Turquoise Hill and its subsidiaries. Year Ended December 31, Statements of Income 2021 2020 Operating and corporate administration expenses: Cost recoveries - Turquoise Hill $ 1,151 $ 2,803 Management services payment (i) (29,706 ) (28,305 ) Cost recoveries - Rio Tinto (ii) (66,362 ) (38,213 ) Finance income: Cash and cash equivalents (iii) - 2,329 Receivable from Rio Tinto (iv) - 2,123 Finance costs: Completion support fee (v) (109,315 ) (110,054 ) $ (204,232 ) $ (169,317 ) Year Ended December 31, Statements of Cash Flows 2021 2020 Cash generated from operating activities Interest received (iii, iv) $ - $ 9,848 Interest paid (v) (107,896 ) (107,948 ) Cash flows from investing activities Receivable from related party: amounts withdrawn (iv) - 511,284 Expenditures on property, plant and equipment: Management services payment and cost recoveries - Rio Tinto (i), (ii) (37,302 ) (75,470 ) Balance Sheets December 31, December 31, Trade and other receivables (Note 10) $ 39 $ 852 Prepaid expenses and other assets (Note 11) 81,725 83,144 Trade and other payables (Note 14) Management services payment - Rio Tinto (i) (14,584 ) (13,137 ) Cost recoveries - Rio Tinto (ii) (39,569 ) (52,415 ) $ 27,611 $ 18,444 (i) In accordance with the Amended and Restated Shareholders’ Agreement, which was signed on June 8, 2011, and other related agreements, Turquoise Hill is required to make a management services payment to Rio Tinto equal to a percentage of all capital costs and operating costs incurred by Oyu Tolgoi from March 31, 2010 onwards. After signing the Underground Mine Development and Financing Plan on May 18, 2015, the management services payment to Rio Tinto has been calculated as 1.5% applied to underground development and sustaining (ii) Rio Tinto recovers the costs of providing general corporate support services and mine management services to Turquoise Hill. Mine management services are provided by Rio Tinto in its capacity as the manager of Oyu Tolgoi. (iii) In addition to placing cash and cash equivalents on deposit with banks or investing funds with other financial institutions, Turquoise Hill may deposit cash and cash equivalents with Rio Tinto in accordance with an agreed upon policy and strategy for the management of liquid resources. Funds deposited with Rio Tinto earn interest at rates equivalent to those offered by financial institutions or short-term corporate debt. At December 31, 2021 and December 31, 2020, there were no funds deposited with wholly owned subsidiaries of Rio Tinto. (iv) As part of project finance (Note 15), Turquoise Hill appointed 9539549 Canada Inc., a wholly owned subsidiary of Rio Tinto, as service provider to provide post-drawdown cash management services in connection with net proceeds from the project finance facility, which were placed with 9539549 Canada Inc. and shall be returned to Turquoise Hill as required for purposes of Oyu Tolgoi underground mine development and funding. Rio Tinto International Holdings Limited, a wholly owned subsidiary of Rio Tinto, agreed to guarantee the obligations of the service provider under this agreement. At December 31, 2021 and December 31, 2020, there were no amounts due from 9539549 Canada Inc. Amounts due had been earning interest at an effective annual rate of LIBOR plus 2.45%. The interest rate reflected: interest receivable at LIBOR minus 0.05%; plus a benefit of 2.5% arising on amounts receivable from 9539549 Canada Inc. under the Cash Management Services Agreement, which are net settled with the 2.5% completion support fee described in (v) below. (v) As part of the project finance agreements (Note 15), Rio Tinto agreed to provide a guarantee, known as the completion support undertaking (“CSU”) in favour of the Commercial Banks and the Export Credit Agencies. In consideration for providing the CSU, the Company is required to pay Rio Tinto a fee equal to 2.5% of the amounts drawn under the facility. The annual completion support fee of 2.5% on amounts drawn under the facility is accounted for as a borrowing cost and included within interest expense and similar charges (refer to Note 7). The fee is settled net of a benefit arising on amounts receivable from 9539549 Canada Inc. under the Cash Management Services Agreement described in (iv) above. The fee payment obligation will terminate on the date Rio Tinto’s CSU obligations to the project lenders terminate. |
Financial instruments and fai_2
Financial instruments and fair value measurements (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
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Summary of Financial Instruments and Fair Value Measurements | Fair Value at December 31, 2021 Total Level 1 Level 2 Level 3 Money market funds (a) $ 193,243 $ 193,243 $ - $ - Marketable securities (a) 9,323 9,323 - - Trade receivables (b) 13,645 - 13,645 - Commodity put options (c) 109 - 109 - $ 216,320 $ 202,566 $ 13,754 $ - Fair Value at December 31, 2020 Total Level 1 Level 2 Level 3 Money market funds (a) $ 667,542 $ 667,542 $ - $ - Marketable securities (a) 6,379 6,379 - - Trade receivables (b) 50,459 - 50,459 - $ 724,380 $ 673,921 $ 50,459 $ - (a) The Company’s money market funds and marketable securities are classified within level 1 of the fair value hierarchy as they are valued using quoted market prices in active markets. (b) Trade receivables from provisionally priced concentrate sales are included in level 2 of the fair value hierarchy as the basis of valuation uses quoted commodity prices. (c) In 2021 the Company purchased copper and gold put options to establish a synthetic copper and gold price floor in order to provide increased certainty around the Company’s liquidity horizon. During the year ended December 31, 2021 the Company recognized a realized loss of $23.9 million and an unrealized loss of $5.9 million within Other income ( expenses ) in the consolidated statement of income, and a financial asset of $0.1 million within current Other financial assets in the consolidated balance sheet as at December 31, 2021. Commodity put options are included in level 2 of the fair value hierarchy as the basis of valuation uses quoted prices. |
Summary of contractual maturities of financial liabilities | The following are the remaining contractual maturities of financial liabilities at the reporting date. The amounts are gross and undiscounted and include contractual interest payments. Interest payments on variable interest rate loans reflect interest rates at the reporting date and these amounts may change as market interest rates change. Refer to additional disclosures around liquidity risk in Note 1. Between 1 At December 31, 2021 Less than 1 year and 5 years After 5 years Total Carrying amount Non-derivative Trade and other payables $ 384,488 $ - $ - $ 384,488 $ 384,488 Expected lease liability 10,727 20,752 306 31,785 25,435 Borrowings 564,742 3,059,498 1,373,049 4,997,289 4,157,344 Total $ 959,957 $ 3,080,250 $ 1,373,355 $ 5,413,562 $ 4,567,267 Between 1 At December 31, 2020 Less than 1 year and 5 After 5 years Total Carrying amount Non-derivative Trade and other payables $ 390,059 $ - $ - $ 390,059 $ 390,059 Expected lease liability 1,121 19,631 205 20,957 16,868 Borrowings 204,035 2,935,929 2,048,916 5,188,880 4,184,911 Total $ 595,215 $ 2,955,560 $ 2,049,121 $ 5,599,896 $ 4,591,838 |
Key management compensation (Ta
Key management compensation (Tables) | 12 Months Ended |
Dec. 31, 2021 | |
Text block [abstract] | |
Schedule of Key Management Compensation | The compensation for key management, which comprises Turquoise Hill’s directors, Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, and Chief Legal Officer in respect of employee services is as follows: Year 2021 2020 Salaries, director fees and other short term benefits $ 6,776 $ 3,186 Post-employment benefits 193 293 Share based payment 1,412 1,628 $ 8,381 $ 5,107 |
Nature of operations and liqu_2
Nature of operations and liquidity risk - Additional Information (Detail) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Nature of operations [line items] | ||
Working capital balance | $ 200 | |
Minimum Equity offering common stock subscriptions | $ 650 | |
Estimated equity Offering Date | Aug. 31, 2022 | |
Notional amount | $ 300 | |
Oyu Tolgoi Copper Gold Mine Under Ground Development Project [Member] | ||
Nature of operations [line items] | ||
Cummulative increase to the estimate of Commited Capital | 175 | |
Cash [member] | ||
Nature of operations [line items] | ||
Liquidity amount available | $ 700 | |
Rio Tinto [member] | ||
Nature of operations [line items] | ||
Percentage of ownership interest held by ultimate parent entity | 50.80% | 50.80% |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | ||
Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 | |
Disclosure of summary of significant accounting policies [line items] | |||
Accumulated adjustment to equity | $ 9,108,958 | $ 8,427,953 | $ 7,931,057 |
Property, plant and equipment | 11,974,480 | 10,927,512 | 9,782,647 |
Revenue | 1,971,042 | 1,078,192 | |
Cost of sales | 622,329 | 669,394 | |
Revision of Prior Period, Adjustment [Member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Revenue | 70,000 | ||
Increase (decrease) due to changes in accounting policy required by IFRSs [member] | Property, Plant and Equipment-Proceeds before Intended Use [member] | Construction in progress [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Property, plant and equipment | 21,000 | ||
Increase Decrease Upon The Adoption Of Amendments To IAS16 [Member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Revenue | 15,000 | ||
Cost of sales | 55,000 | ||
Retained earnings [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Accumulated adjustment to equity | (2,890,711) | (3,415,601) | (3,821,889) |
Retained earnings [member] | Increase (decrease) due to changes in accounting policy required by IFRSs [member] | Property, Plant and Equipment-Proceeds before Intended Use [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Accumulated adjustment to equity | 21,000 | ||
Oyu Tolgoi [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Authorised capital plans but not contracted for | $ 780,000 | ||
Percentage of ownership interest in subsidiary | 66.00% | ||
Percentage of ownership interest, held by non-controlling interest | 34.00% | ||
Percentage of fund provided for mine exploration and development costs of subsidiary | 100.00% | ||
Oyu Tolgoi [member] | Construction in progress [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Property, plant and equipment | $ 8,287,366 | $ 7,219,502 | $ 5,931,750 |
Bottom of range [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Final adjustment period of selling price | 30 days | ||
Top of range [member] | |||
Disclosure of summary of significant accounting policies [line items] | |||
Final adjustment period of selling price | 180 days |
Operating Segment - Schedule of
Operating Segment - Schedule of Operating Segments (Detail) - USD ($) $ in Thousands | 12 Months Ended | |||
Dec. 31, 2021 | Dec. 31, 2020 | |||
Disclosure of operating segments [line items] | ||||
Revenue | $ 1,971,042 | $ 1,078,192 | ||
Cost of sales | (622,329) | (669,394) | ||
Gross margin | 1,348,713 | 408,798 | ||
Operating (expenses) income | (275,487) | (202,271) | ||
Corporate administration expenses | (37,699) | (30,602) | ||
Other (expenses) income | (37,577) | 482 | ||
Income (loss) before finance items and taxes | 997,950 | 176,407 | ||
Finance income | 2,998 | 17,349 | ||
Finance costs | (8,036) | (5,510) | ||
Income from operations before taxes | 992,912 | 188,246 | ||
Income and other taxes | (311,792) | 306,396 | ||
Income for the year | 681,120 | 494,642 | ||
Depreciation and depletion | 165,366 | 181,260 | ||
Capital additions | 1,263,698 | 1,326,274 | ||
Current assets | 1,121,147 | 1,508,869 | ||
Non-current assets | 13,003,542 | 11,859,892 | ||
Current liabilities | 931,277 | 521,636 | ||
Non-current liabilities | 4,084,454 | 4,419,172 | [1] | |
Net increase (decrease) in cash | (429,325) | (528,364) | ||
Operating segments [member] | Oyu Tolgoi [member] | ||||
Disclosure of operating segments [line items] | ||||
Revenue | 1,971,042 | 1,078,192 | ||
Cost of sales | (622,329) | (669,394) | ||
Gross margin | 1,348,713 | 408,798 | ||
Operating (expenses) income | (321,257) | (245,718) | ||
Corporate administration expenses | 0 | |||
Other (expenses) income | (7,575) | 3,254 | ||
Income (loss) before finance items and taxes | 1,019,881 | 166,334 | ||
Finance income | 1,783 | 4,292 | ||
Finance costs | (282,606) | (257,765) | ||
Income from operations before taxes | 739,058 | (87,139) | ||
Income and other taxes | (279,559) | 347,003 | ||
Income for the year | 459,499 | 259,864 | ||
Depreciation and depletion | 165,269 | 181,146 | ||
Capital additions | 1,263,698 | 1,326,274 | ||
Current assets | 497,845 | 431,271 | ||
Non-current assets | 13,375,066 | 12,025,763 | ||
Current liabilities | 909,328 | 501,013 | ||
Non-current liabilities | 12,443,023 | [2] | 11,954,961 | [1] |
Net increase (decrease) in cash | 25,245 | (38,563) | ||
Corporate and other eliminations [member] | ||||
Disclosure of operating segments [line items] | ||||
Revenue | 0 | |||
Cost of sales | 0 | |||
Gross margin | 0 | |||
Operating (expenses) income | 45,770 | 43,447 | ||
Corporate administration expenses | (37,699) | (30,602) | ||
Other (expenses) income | (30,002) | (2,772) | ||
Income (loss) before finance items and taxes | (21,931) | 10,073 | ||
Finance income | 1,215 | 13,057 | ||
Finance costs | 274,570 | 252,255 | ||
Income from operations before taxes | 253,854 | 275,385 | ||
Income and other taxes | (32,233) | (40,607) | ||
Income for the year | 221,621 | 234,778 | ||
Depreciation and depletion | 97 | 114 | ||
Capital additions | 0 | |||
Current assets | 623,302 | 1,077,598 | ||
Non-current assets | (371,524) | (165,871) | ||
Current liabilities | 21,949 | 20,623 | ||
Non-current liabilities | (8,358,569) | [2] | (7,535,789) | [1] |
Net increase (decrease) in cash | $ (454,570) | $ (489,801) | ||
[1] | The Oyu Tolgoi segment’s non-current liabilities includes $7.3 billion of shareholder loan and accrued interest liability and the Corporate and other elimination segment’s non-current liabilities includes $7.3 billion of shareholder loan and accrued interest asset at December 31, 2020. | |||
[2] | The Oyu Tolgoi segment’s non-current liabilities includes $8.1 billion of shareholder loan and accrued interest liability and the Corporate and other elimination segment’s non-current liabilities includes $8.1 billion of shareholder loan and accrued interest asset at December 31, 2021. |
Operating Segment - Schedule _2
Operating Segment - Schedule of Operating Segments (Parenthetical) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of operating segments [line items] | ||
Revenue | $ 1,971,042 | $ 1,078,192 |
Material reconciling items [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | 0 | |
Shareholders loan and accrued interest liability | 8,100,000 | 7,300,000 |
Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | 1,971,042 | 1,078,192 |
Shareholders loan and accrued interest liability | $ 8,100,000 | $ 7,300,000 |
CHINA | Bottom of range [member] | Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Percentage of revenue | 10.00% | 10.00% |
CHINA | Customer one [member] | Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | $ 234,200 | $ 230,700 |
CHINA | Customer two [member] | Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | 226,000 | 177,400 |
CHINA | Customer three [member] | Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | 216,900 | 110,500 |
CHINA | Customer four [member] | Oyu Tolgoi [member] | Operating segments [member] | ||
Disclosure of operating segments [line items] | ||
Revenue | $ 214,500 | $ 106,200 |
Revenue - Schedule of Revenue (
Revenue - Schedule of Revenue (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of revenue [line items] | ||
Copper | $ 1,204,519 | $ 797,297 |
Gold | 748,582 | 265,648 |
Silver | 17,941 | 15,247 |
Revenue | 1,971,042 | 1,078,192 |
Revenue from contracts with customers [member] | ||
Disclosure of revenue [line items] | ||
Copper | 1,151,118 | 755,874 |
Gold | 754,345 | 260,055 |
Silver | 18,127 | 14,575 |
Revenue | 1,923,590 | 1,030,504 |
Other revenue [member] | ||
Disclosure of revenue [line items] | ||
Copper | 53,401 | 41,423 |
Gold | (5,763) | 5,593 |
Silver | (186) | 672 |
Revenue | $ 47,452 | $ 47,688 |
Cost of Sales - Schedule of Cos
Cost of Sales - Schedule of Cost of Sales (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Analysis of income and expense [abstract] | ||
Production and delivery | $ 459,322 | $ 493,370 |
Depreciation and depletion | 163,007 | 176,024 |
Cost of sales | $ 622,329 | $ 669,394 |
Operating Expenses - Schedule o
Operating Expenses - Schedule of Operating Expenses (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Expenses by nature [abstract] | ||
Oyu Tolgoi administration expenses | $ 156,066 | $ 124,889 |
Royalty expenses | 105,399 | 63,420 |
Inventory reversals | (3,465) | (2,703) |
Selling expenses | 15,041 | 11,147 |
Depreciation | 2,359 | 5,236 |
Other | 87 | 282 |
Total | $ 275,487 | $ 202,271 |
Finance Items - Schedule of Fin
Finance Items - Schedule of Finance Income and Finance Costs (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Finance income: | ||
Interest income | $ 2,998 | $ 17,349 |
Finance income | 2,998 | 17,349 |
Finance costs: | ||
Interest expense and similar charges | (299,618) | (340,040) |
Amounts capitalized to property, plant and equipment | 297,392 | 337,727 |
Accretion of decommissioning obligations | (5,810) | (3,197) |
Finance costs | $ (8,036) | $ (5,510) |
Finance Items - Schedule of F_2
Finance Items - Schedule of Finance Income and Finance Costs (Parenthetical) (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Finance income and cost expense [Line Items] | ||
Finance income | $ 2,998 | $ 17,349 |
Rio Tinto Limited [Member] | ||
Finance income and cost expense [Line Items] | ||
Weighted average rate of general borrowings | 8.10% | 8.30% |
Finance income | $ 0 | $ 2,100 |
Cash and Cash Equivalents - Sch
Cash and Cash Equivalents - Schedule of Cash and Cash Equivalents (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Cash and cash equivalents [abstract] | |||
Cash at bank and on hand | $ 101,745 | $ 61,783 | |
Money market funds | 193,243 | 667,542 | |
Other cash equivalents | 399,308 | 394,296 | |
Cash and cash equivalents | $ 694,296 | $ 1,123,621 | $ 1,651,985 |
Inventories - Summary of Invent
Inventories - Summary of Inventories (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Classes of current inventories [abstract] | ||
Concentrate | $ 148,270 | $ 48,504 |
Ore stockpiles | 27,911 | 44,846 |
Materials and supplies | 185,797 | 180,038 |
Provision against carrying value of materials and supplies | (71,961) | (75,426) |
Inventories | 290,017 | 197,962 |
Ore stockpiles | 60,711 | 37,557 |
Inventories | $ 60,711 | $ 37,557 |
Inventories - Additional Inform
Inventories - Additional Information (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Classes of current inventories [abstract] | ||
Cost of sales | $ 622,329 | $ 669,394 |
Inventory write-downs, net of charges/reversals | (3,465) | (2,703) |
Amount of inventories on which there was a provision against carrying value which was sold and recognized in cost of sales for the period | $ 0 | $ 100 |
Trade and Other Receivables - S
Trade and Other Receivables - Summary of Trade and Other Receivables (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Trade and other receivables [abstract] | ||
Trade receivables from provisionally priced sales | $ 13,645 | $ 50,459 |
Other receivables | 2,435 | 8,701 |
Total | 16,119 | 60,012 |
Due from related parties (Note 22) | $ 39 | $ 852 |
Prepaid Expenses and Other As_3
Prepaid Expenses and Other Assets - Summary of Prepaid Expenses and Other Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current Prepaid Expenses: | ||
Prepaid expenses | $ 38,881 | $ 44,130 |
Amounts prepaid to related parties | 81,725 | 83,144 |
Other current prepaid expenses | 120,606 | 127,274 |
Non-current prepaid Expenses: | ||
Prepaid Foreign Tax Noncurrent | 348,171 | 0 |
Other | 500 | 0 |
Other non-current prepaid expenses | $ 348,671 | $ 0 |
Other Non-current Financial A_3
Other Non-current Financial Assets - Summary of Other Non-current Financial Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current assets: | ||
Commodity put options | $ 109 | $ 0 |
Other current financial assets | 109 | 0 |
Other non-current financial assets: | ||
Marketable securities | 9,323 | 6,379 |
Other | 7,495 | 7,739 |
Other non-current financial assets | $ 16,818 | $ 14,118 |
Property, Plant and Equipment -
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | $ 10,927,512 | $ 9,782,647 |
Additions | 966,306 | 988,547 |
Interest capitalized | 297,392 | 337,727 |
Changes to decommissioning obligations | 13,888 | 26,529 |
Depreciation for the period | (230,469) | (206,551) |
Disposals and write offs | (149) | (1,387) |
Property, plant and equipment at end of period | 11,974,480 | 10,927,512 |
Non-current assets pledged as security | 11,973,641 | 10,926,576 |
Cost [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 13,756,844 | |
Property, plant and equipment at end of period | 15,026,536 | 13,756,844 |
Accumulated depreciation / Impairment [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | (2,829,332) | |
Property, plant and equipment at end of period | (3,052,056) | (2,829,332) |
Mining Property Interests [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 695,552 | 723,516 |
Additions | 33,208 | 5,965 |
Changes to decommissioning obligations | 13,888 | 26,529 |
Depreciation for the period | (48,967) | (60,458) |
Property, plant and equipment at end of period | 693,681 | 695,552 |
Non-current assets pledged as security | 693,681 | 695,552 |
Mining Property Interests [member] | Cost [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 1,303,134 | |
Property, plant and equipment at end of period | 1,350,231 | 1,303,134 |
Mining Property Interests [member] | Accumulated depreciation / Impairment [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | (607,582) | |
Property, plant and equipment at end of period | (656,550) | (607,582) |
Plant and equipment [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 3,011,522 | 3,126,331 |
Additions | 13,906 | |
Depreciation for the period | (181,405) | (145,979) |
Disposals and write offs | (149) | (858) |
Transfers and other movements | 148,720 | 32,028 |
Property, plant and equipment at end of period | 2,992,594 | 3,011,522 |
Non-current assets pledged as security | 2,992,594 | 3,011,522 |
Plant and equipment [member] | Cost [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 4,868,370 | |
Property, plant and equipment at end of period | 5,023,101 | 4,868,370 |
Plant and equipment [member] | Accumulated depreciation / Impairment [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | (1,856,848) | |
Property, plant and equipment at end of period | (2,030,507) | (1,856,848) |
Capital works in progress [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 7,219,502 | 5,931,750 |
Additions | 919,192 | 982,582 |
Interest capitalized | 297,392 | 337,727 |
Disposals and write offs | (529) | |
Transfers and other movements | (148,720) | (32,028) |
Property, plant and equipment at end of period | 8,287,366 | 7,219,502 |
Non-current assets pledged as security | 8,287,366 | 7,219,502 |
Capital works in progress [member] | Cost [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 7,584,209 | |
Property, plant and equipment at end of period | 8,652,073 | 7,584,209 |
Capital works in progress [member] | Accumulated depreciation / Impairment [member] | Oyu Tolgoi [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | (364,707) | |
Property, plant and equipment at end of period | (364,707) | (364,707) |
Plant and equipment [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 936 | 1,050 |
Depreciation for the period | (97) | (114) |
Property, plant and equipment at end of period | 839 | 936 |
Plant and equipment [member] | Cost [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | 1,131 | |
Property, plant and equipment at end of period | 1,131 | 1,131 |
Plant and equipment [member] | Accumulated depreciation / Impairment [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Property, plant and equipment at beginning of period | (195) | |
Property, plant and equipment at end of period | $ (292) | $ (195) |
Property, Plant and Equipment_2
Property, Plant and Equipment - Summary of Property, Plant and Equipment (Parenthetical) (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about property, plant and equipment [line items] | ||
Preproduction revenue | $ 69.7 | $ 26.1 |
Preproduction costs | 14.9 | 5.4 |
Cash On Hand And Bank [Member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Assets pledged | 72.9 | 47.7 |
Current Inventory [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Inventory pledged as security | 290 | 197.9 |
Non-current Inventory [member] | ||
Disclosure of detailed information about property, plant and equipment [line items] | ||
Inventory pledged as security | $ 60.7 | $ 37.6 |
Property, plant and equipment_3
Property, plant and equipment - Schedule Of Detailed Information About Property Plant Equipment And Leased Assets (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of detailed information about property, plant and equipment [line items] | |||
Property, plant and equipment | $ 11,974,480 | $ 10,927,512 | $ 9,782,647 |
Plant and equipment owned [Member] | |||
Disclosure of detailed information about property, plant and equipment [line items] | |||
Property, plant and equipment | 11,961,967 | 10,923,294 | |
Right of use assets [Member] | |||
Disclosure of detailed information about property, plant and equipment [line items] | |||
Property, plant and equipment | $ 12,513 | $ 4,218 |
Property, plant and equipment_4
Property, plant and equipment - Summary Of Quantitative Information About Right Use Assets (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about property, plant and equipment [abstract] | ||
Beginning Balance | $ 4,218 | $ 8,710 |
Additions | 13,945 | |
Depreciation for the period | (5,650) | (4,492) |
Ending Balance | $ 12,513 | $ 4,218 |
Property, Plant and Equipment_5
Property, Plant and Equipment - Additional Information (Detail) | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Reduction In Recoverable amount | |
Long term forecast copper price per pound | 3.43 |
Percent of total recoverable amount | 8.00% |
Long term forecast gold price per ounce | 1,601 |
Increase percentage of copper and gold prices | 19.00% |
Fair value estimate changes | |
Fair value estimate changes | |
Copper [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Fair value estimate changes, Rate | 5.00% |
Fair value estimate changes, Rate | 5.00% |
Gold [Member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Fair value estimate changes, Rate | 5.00% |
Fair value estimate changes, Rate | 5.00% |
Bottom of range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Post-tax real discount rate | 1.00% |
Top of range [member] | |
Disclosure of detailed information about property, plant and equipment [line items] | |
Post-tax real discount rate | 9.00% |
Trade and Other Payables - Summ
Trade and Other Payables - Summary of Trade and Other Payables (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Trade and other payables [abstract] | ||
Trade payables and accrued liabilities | $ 320,791 | $ 315,570 |
Interest payable on long-term borrowings | 7,280 | 7,266 |
Payable to related parties | 54,153 | 65,552 |
Other | 2,264 | 1,671 |
Trade and other current payables | $ 384,488 | $ 390,059 |
Borrowings and Other Financia_3
Borrowings and Other Financial Liabilities - Detailed Information about Borrowings (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Current liabilities [abstract] | ||
Project finance facility | $ 387,561 | $ 27,567 |
Lease liabilities | 9,860 | 721 |
Current Borrowings And Other Financial Liabilities | 397,421 | 28,288 |
Non-current liabilities [abstract] | ||
Project finance facility | 3,769,783 | 4,157,344 |
Lease liabilities | 15,575 | 16,147 |
Total Non-current borrowings and other financial liabilities | $ 3,785,358 | $ 4,173,491 |
Borrowings and Other Financia_4
Borrowings and Other Financial Liabilities - Detailed Information about Borrowings (Parenthetical) (Detail) - Oyu Tolgoi [member] $ in Billions | Dec. 15, 2015USD ($) |
Disclosure of detailed information about borrowings [line items] | |
Project finance facility | $ 4.4 |
Debt cap | 6 |
Supplemental debt | 1.6 |
Additional drawn down amount available under borrowing facility | $ 0.1 |
Borrowings and Other Financia_5
Borrowings and Other Financial Liabilities - Additional Information (Detail) - Oyu Tolgoi [member] - USD ($) $ in Billions | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of detailed information about borrowings [line items] | ||
Amount drawn down under project finance facility | $ 4.3 | |
Weighted average incremental borrowing rate | 7.60% | 7.80% |
Borrowings and Other Financia_6
Borrowings and Other Financial Liabilities - Detailed Information about Project Finance Facility (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 3,769,783 | $ 4,157,344 |
Fair Value | 4,282,140 | $ 4,325,629 |
Gross carrying amount [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | 4,157,344 | |
International Financial Institutions A Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 775,836 | |
Original Term | 15 years | |
14 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 865,801 | |
Original Term | 14 years | |
13 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 277,511 | |
Original Term | 13 years | |
MIGA Insured Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 673,248 | |
Original Term | 12 years | |
Commercial Banks B Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 1,564,948 | |
Original Term | 12 years | |
Interest rate pre completion [member] | International Financial Institutions A Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 3.78% | |
Annual interest rate, basis | LIBOR | |
Interest rate pre completion [member] | 14 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 3.65% | |
Annual interest rate, basis | LIBOR | |
Interest rate pre completion [member] | 13 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate | 2.30% | |
Interest rate pre completion [member] | MIGA Insured Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 2.65% | |
Annual interest rate, basis | LIBOR | |
Interest rate pre completion [member] | Commercial Banks B Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 3.40% | |
Annual interest rate, basis | LIBOR | |
Borrowings maturity | 15-year loan at A Loan rate | |
Interest rate post completion [member] | International Financial Institutions A Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 4.78% | |
Annual interest rate, basis | LIBOR | |
Interest rate post completion [member] | 14 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 4.65% | |
Annual interest rate, basis | LIBOR | |
Interest rate post completion [member] | 13 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate | 2.30% | |
Interest rate post completion [member] | MIGA Insured Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Annual interest rate, adjustment to basis | 3.65% | |
Annual interest rate, basis | LIBOR | |
Interest rate post completion [member] | Commercial Banks B Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Carrying Value | $ 50,000 | |
Annual interest rate, adjustment to basis | 4.40% | |
Annual interest rate, basis | LIBOR | |
At fair value [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | $ 4,438,146 | |
At fair value [member] | International Financial Institutions A Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | 820,958 | |
At fair value [member] | 14 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | 921,116 | |
At fair value [member] | 13 years export credit agencies loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | 311,637 | |
At fair value [member] | MIGA Insured Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | 711,980 | |
At fair value [member] | Commercial Banks B Loan [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Fair Value | $ 1,672,455 |
Borrowings and Other Financia_7
Borrowings and Other Financial Liabilities - Detailed Information about Project Finance Facility (Parenthetical) (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Oyu Tolgoi [member] | |
Disclosure of detailed information about borrowings [line items] | |
Aggregate initial fair value of borrowings less transaction costs | $ 4,348.9 |
Amortized transaction costs | $ 124.8 |
Borrowing facility, interest-only payments period | 5 years |
MIGA Insured Loan [member] | |
Disclosure of detailed information about borrowings [line items] | |
Annual insurance premium | 1.40% |
Borrowings and other financia_8
Borrowings and other financial liabilities - Summary of Maturity Principal Repayments of Borrowings (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Maturity analysis - Project Finance facility | ||
Borrowings | $ 4,282,140 | $ 4,325,629 |
Less than one year [member] | ||
Maturity analysis - Project Finance facility | ||
Borrowings | 403,483 | 43,489 |
1 to 5 years [member] | ||
Maturity analysis - Project Finance facility | ||
Borrowings | 2,610,445 | 2,418,861 |
More than 5 years [member] | ||
Maturity analysis - Project Finance facility | ||
Borrowings | $ 1,268,212 | $ 1,863,279 |
Borrowings and other financia_9
Borrowings and other financial liabilities - Schedule Of Lease Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of detailed information about borrowings [line items] | ||
Total undiscounted lease liabilities | $ 31,785 | $ 20,957 |
Lease liabilities included in the Consolidated balance sheet | 25,435 | 16,868 |
Current | 9,860 | 721 |
Non-Current | 15,575 | 16,147 |
Less than one year [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Total undiscounted lease liabilities | 10,727 | 1,121 |
One to five years [Member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Total undiscounted lease liabilities | 20,752 | 19,631 |
More than 5 years [member] | ||
Disclosure of detailed information about borrowings [line items] | ||
Total undiscounted lease liabilities | $ 306 | $ 205 |
Income Taxes - Summary of Compo
Income Taxes - Summary of Components of Tax Expenses and Benefit (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Major components of tax expense (income) [abstract] | ||
Current | $ 232 | $ 7,694 |
Deferred | ||
Temporary differences including tax losses | 277,843 | (346,627) |
Withholding taxes | 33,717 | 32,537 |
Deferred tax expense (income) | 311,560 | (314,090) |
Net income statement expense (benefit) for income taxes | $ 311,792 | $ (306,396) |
Income Taxes - Summary of Com_2
Income Taxes - Summary of Components of Tax Expenses and Benefit (Parenthetical) (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure representing major components of tax expense income [line items] | ||
Withholding tax cash payment for interest and other taxes | $ 200 | $ 28,300 |
Deferred tax assets | 602,862,000 | 880,705,000 |
Mongolia [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Deferred tax assets relating to tax losses that expire if not recovered against taxable profits | 150,700,000 | |
Deferred tax assets | 561,900,000 | 841,300,000 |
Deferred tax assets relating to accrued but unpaid interest expense and other temporary differences | $ 411,200,000 | $ 452,000,000 |
Income Taxes - Summary of Prior
Income Taxes - Summary of Prior Period Withholding Tax Obligations (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Major components of tax expense (income) [abstract] | ||
Income (loss) from operations before taxes | $ 992,912 | $ 188,246 |
Tax at Canadian combined federal and provincial income tax rate (2021: 26.5%; 2020: 26.5%) | 263,122 | 49,885 |
Change in amount of deferred tax recognized | 151,117 | (276,945) |
Difference in tax rates and treatment in foreign jurisdictions | (140,903) | (116,208) |
Withholding taxes | 33,717 | 32,537 |
Non deductible losses and expense | 4,739 | 4,335 |
Net income statement expense (benefit) for income taxes | $ 311,792 | $ (306,396) |
Income Taxes - Summary of Pri_2
Income Taxes - Summary of Prior Period Withholding Tax Obligations (Parenthetical) (Detail) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Major components of tax expense (income) [abstract] | ||
Canadian federal and provincial income tax rate | 26.50% | 26.50% |
Income Taxes - Summary of Defer
Income Taxes - Summary of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets | ||
Non-capital losses | $ 190,203 | $ 427,695 |
Capital losses | 0 | 0 |
Other temporary differences including accrued interest | 412,659 | 453,010 |
Deferred tax assets | 602,862 | 880,705 |
Deferred tax liabilities | ||
Withholding tax | (145,434) | (111,717) |
Deferred tax liabilities | (145,434) | (111,717) |
Unrecognized deferred tax assets | ||
Non-capital losses | 152,853 | 281,643 |
Capital losses | 117,517 | 117,945 |
Other temporary differences including accrued interest | 319,227 | 63,471 |
Unrecognized deferred tax assets | 589,597 | 463,059 |
Unrecognized deferred tax liabilities | ||
Withholding tax | 0 | 0 |
Unrecognized deferred tax liabilities | $ 0 | $ 0 |
Income Taxes - Summary of Def_2
Income Taxes - Summary of Deferred Tax Assets and Liabilities (Parenthetical) (Detail) - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Deferred tax assets and liabilities [abstract] | ||
Unremitted earnings | $ 1,188 | $ 606 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure representing major components of tax expense income [line items] | ||
Investment tax credits | $ 812,100,000 | $ 812,100,000 |
Deferred tax | 311,560,000 | (314,090,000) |
Deferred tax assets | 602,862,000 | 880,705,000 |
Mongolia [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Increase decrease in deferred tax liability asset | 279,400,000 | 347,300,000 |
Deferred tax assets | 561,900,000 | 841,300,000 |
Deferred tax assets relating to accrued but unpaid interest expense and other temporary differences | 411,200,000 | 452,000,000 |
Deferred tax assets relating to tax losses that expire if not recovered against taxable profits | 389,300,000 | |
Mongolia [member] | Additional operating losses and accrued but unpaid interest [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Increase decrease in deferred tax liability asset | 28,900,000 | 76,600,000 |
Mongolia [member] | Temporary differences fixed assets [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Increase decrease in deferred tax liability asset | 308,300,000 | 270,700,000 |
Canada [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Deferred tax assets | 41,000,000 | 39,400,000 |
Canada [member] | Non Capital Losses | ||
Disclosure representing major components of tax expense income [line items] | ||
Deferred tax assets | 39,500,000 | 38,400,000 |
Canada [member] | Other temporary differences | ||
Disclosure representing major components of tax expense income [line items] | ||
Deferred tax assets relating to accrued but unpaid interest expense and other temporary differences | 1,500,000 | $ 1,000,000 |
Investment tax credits [member] | ||
Disclosure representing major components of tax expense income [line items] | ||
Deferred tax | $ 0 |
Decommissioning Obligations - D
Decommissioning Obligations - Detailed Information about Decommissioning Obligations (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of decommissioning liabilities [abstract] | ||
Opening carrying amount | $ 133,964 | $ 104,238 |
Changes in estimates | 13,888 | 26,529 |
Accretion of present value discount | 5,810 | 3,197 |
Closing carrying amount | $ 153,662 | $ 133,964 |
Decommissioning Obligations - A
Decommissioning Obligations - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure Of Decommissioning Liabilities [line items] | ||
Estimated future cash expenditures | $ 349.7 | $ 227.8 |
Discount rate used in net present value of expected future cash flows | 1.50% | 1.50% |
Oyu Tolgoi [member] | ||
Disclosure Of Decommissioning Liabilities [line items] | ||
Anticipated closure date | 2101 |
Share Capital - Additional Info
Share Capital - Additional Information (Detail) - shares | Oct. 23, 2020 | Dec. 31, 2021 | Dec. 31, 2020 | Dec. 31, 2019 |
Disclosure of classes of share capital [line items] | ||||
Description of the reverse stock split arrangement | ratio of one post-consolidation share for every ten pre-consolidation shares | |||
Number of shares issued | 201,231,446 | 2,012,314,469 | ||
Number of shares outstanding | 201,231,446 | 2,012,314,469 | ||
Common Shares [member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number of shares issued | 201,231,446 | 201,231,446 | ||
Number of shares outstanding | 201,231,446 | 201,231,446 | ||
Preferred Shares [member] | ||||
Disclosure of classes of share capital [line items] | ||||
Number of shares issued | 0 | 0 | ||
Number of shares outstanding | 0 | 0 |
Non-controlling Interests - Sum
Non-controlling Interests - Summary of Non-controlling Interests in Subsidiaries (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of subsidiaries [line items] | ||
Beginning balance | $ (1,148,820) | |
Non-controlling interest's share of income | 156,230 | $ 88,354 |
Ending balance | (992,590) | (1,148,820) |
Oyu Tolgoi [member] | ||
Disclosure of subsidiaries [line items] | ||
Beginning balance | (1,148,820) | (1,237,174) |
Non-controlling interest's share of income | 156,230 | 88,354 |
Common share investments funded on behalf of non-controlling interest | 20,400 | 137,700 |
Funded amounts repayable to the Company | (20,400) | (137,700) |
Ending balance | $ (992,590) | $ (1,148,820) |
Non-controlling Interests - S_2
Non-controlling Interests - Summary of Non-controlling Interests in Subsidiaries (Parenthetical) (Detail) | 12 Months Ended |
Dec. 31, 2021 | |
Oyu Tolgoi [member] | |
Disclosure of subsidiaries [line items] | |
Interest on investments in subsidiary on behalf of noncontrolling interest, adjustment to LIBOR interest rate basis | 6.50% |
Non-controlling Interests - Add
Non-controlling Interests - Additional Information (Detail) - Oyu Tolgoi [member] - USD ($) $ in Millions | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of subsidiaries [line items] | ||
Investments in subsidiary on behalf of noncontrolling interest | $ 1,398.9 | $ 1,378.4 |
Accrued interest on Investments in subsidiary on behalf of noncontrolling interest | $ 953.4 | $ 804.4 |
Cash Flow Information - Reconci
Cash Flow Information - Reconciliation of Net Income (Loss) to Net Cash Flow Generated from Operating Activities and Other Non-Cash Transactions (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of supplementary cash flow information [abstract] | ||
Income (loss) for the year | $ 681,120 | $ 494,642 |
Adjustments for: | ||
Depreciation and amortization | 165,366 | 181,260 |
Finance items: | ||
Interest income | (2,998) | (17,349) |
Interest and accretion expense | 8,036 | 5,510 |
Unrealized foreign exchange (gain) loss | 2,228 | (4,297) |
Inventory write down reversals | (3,465) | (2,703) |
Write off of property, plant and equipment | 87 | 282 |
Realized and unrealized losses on commodity put options | 29,797 | |
Income and other taxes | 311,792 | (306,396) |
Other items | 258 | 2,403 |
(Increase) decrease in: | ||
Inventories | (109,212) | (26,534) |
Trade, other receivables and prepaid expenses | 52,148 | (43,456) |
(Decrease) increase in: | ||
Trade and other payables | 29,554 | 12,414 |
Deferred revenue | 46,079 | 75,393 |
Cash generated from operating activities before interest and tax | $ 1,210,790 | $ 371,169 |
Cash Flow Information - Supplem
Cash Flow Information - Supplementary Information Regarding Other Non-Cash Transactions (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Investing activities | ||
Change in accounts payable and accrued liabilities related to purchase of property, plant and equipment | $ (40,022) | $ (79,879) |
Additions to property, plant and equipment - leased assets | $ 13,945 |
Earnings Per Share - Additional
Earnings Per Share - Additional Information (Detail) - shares | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Earnings per share [abstract] | ||
Potentially dilutive shares excluded from the earnings per share calculation | 0 | 0 |
Related Parties - Additional In
Related Parties - Additional Information (Detail) | Dec. 31, 2021 | Dec. 31, 2020 |
Rio Tinto [member] | ||
Disclosure of transactions between related parties [line items] | ||
Ownership interest held by ultimate parent | 50.80% | 50.80% |
Related Parties - Disclosure of
Related Parties - Disclosure of Related Party Transactions by Financial Statement Line Item (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Income statements [abstract] | ||
Finance costs | $ (8,036) | $ (5,510) |
Cash generated from operating activities | ||
Interest received | 2,735 | 20,407 |
Interest paid | (276,392) | (316,778) |
Cash flows from investing activities | ||
Receivable from related party: amounts withdrawn | 0 | 511,284 |
Balance Sheets | ||
Trade and other receivables | 39 | 852 |
Trade and other payables | (54,153) | (65,552) |
Rio Tinto [member] | ||
Income statements [abstract] | ||
Cost recoveries - Turquoise Hill | 1,151 | 2,803 |
Management services payment | (29,706) | (28,305) |
Cost recoveries - Rio Tinto | (66,362) | (38,213) |
Cash and cash equivalents | 2,329 | |
Receivable from Rio Tinto | 2,123 | |
Income (loss) from transactions with related party | (204,232) | (169,317) |
Cash generated from operating activities | ||
Interest received | 9,848 | |
Interest paid | (107,896) | (107,948) |
Cash flows from investing activities | ||
Receivable from related party: amounts withdrawn | 511,284 | |
Expenditures on property, plant and equipment: | ||
Management services payment and cost recoveries - Rio Tinto | (37,302) | 75,470 |
Balance Sheets | ||
Trade and other receivables | 39 | 852 |
Prepaid expenses and other assets | 81,725 | 83,144 |
Total | 27,611 | 18,444 |
Rio Tinto [member] | Completion Support Fee [member] | ||
Income statements [abstract] | ||
Finance costs | (109,315) | (110,054) |
Rio Tinto [member] | Management Services [member] | ||
Balance Sheets | ||
Trade and other payables | (14,584) | (13,137) |
Rio Tinto [member] | Cost recoveries [member] | ||
Balance Sheets | ||
Trade and other payables | $ (39,569) | $ (52,415) |
Related Parties - Disclosure _2
Related Parties - Disclosure of Related Party Transactions by Financial Statement Line Item (Parenthetical) (Detail) - USD ($) $ in Thousands | May 18, 2015 | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of transactions between related parties [line items] | |||
Management services as payment percentage applied to underground development capital costs | 1.50% | ||
Management services as payment percentage applied to operating costs and capital related to current operations | 3.00% | ||
Wholly Owned Subsidiaries of Rio Tinto [member] | |||
Disclosure of transactions between related parties [line items] | |||
Cash equivalents | $ 0 | $ 0 | |
Fee payable equal to amount drawn under facility percentage | 2.50% | ||
Annual completion support fee percentage | 2.50% | ||
Wholly Owned Subsidiaries of Rio Tinto [member] | 9539549 Canada Inc [member] | |||
Disclosure of transactions between related parties [line items] | |||
Interest rate adjustment to basis | 2.45% | ||
Interest rate basis | LIBOR | ||
Wholly Owned Subsidiaries of Rio Tinto [member] | 9539549 Canada Inc [member] | Interest receivable [member] | |||
Disclosure of transactions between related parties [line items] | |||
Interest rate adjustment to basis | 0.05% | ||
Wholly Owned Subsidiaries of Rio Tinto [member] | 9539549 Canada Inc [member] | Cash management services agreement [member] | |||
Disclosure of transactions between related parties [line items] | |||
Interest rate adjustment to basis | 2.50% |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Thousands | Dec. 23, 2020 | Jan. 16, 2018 | Feb. 28, 2021 | Dec. 31, 2021 |
Disclosure of commitments and contingencies [line items] | ||||
Capital commitments | $ 26,000 | |||
Power purchase commitments | 62,800 | |||
Power Source Framework Agreement [Member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Capital commitments | $ 0 | |||
Oyu Tolgoi [member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Adjustment to carry forward tax losses | $ 1,400,000 | |||
Oyu Tolgoi [member] | Tax assessment [member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Tax assessment amount | $ 126,000 | |||
Settlement of unpaid taxes, fines and penalties for accepted items | $ 4,800 | |||
Oyu Tolgoi [member] | Tax assessment [member] | 2013 through 2015 [member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Tax assessment amount | $ 155,000 | |||
Oyu Tolgoi [member] | Tax assessment [member] | 2016 through 2018 [member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Tax assessment amount | $ 228,000 | |||
Oyu Tolgoi [member] | Tax assessment [member] | 2016 through 2018 [member] | Capital city tax department [member] | ||||
Disclosure of commitments and contingencies [line items] | ||||
Tax assessment amount | $ 228,000 |
Financial Instruments and Fai_3
Financial Instruments and Fair Value Measurements - Summary of Financial Instruments and Fair Value Measurements (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | $ 14,124,689 | $ 13,368,761 |
Recurring fair value measurement [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 216,320 | 724,380 |
Recurring fair value measurement [member] | Level 1 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 202,566 | 673,921 |
Recurring fair value measurement [member] | Level 2 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 13,754 | 50,459 |
Recurring fair value measurement [member] | Money market funds [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 193,243 | 667,542 |
Recurring fair value measurement [member] | Money market funds [member] | Level 1 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 193,243 | 667,542 |
Recurring fair value measurement [member] | Marketable Securities [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 9,323 | 6,379 |
Recurring fair value measurement [member] | Marketable Securities [member] | Level 1 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 9,323 | 6,379 |
Recurring fair value measurement [member] | Trade receivables [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 13,645 | 50,459 |
Recurring fair value measurement [member] | Trade receivables [member] | Level 2 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 13,645 | $ 50,459 |
Recurring fair value measurement [member] | Commodity put options [Member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | 109 | |
Recurring fair value measurement [member] | Commodity put options [Member] | Level 2 of fair value hierarchy [member] | ||
Disclosure of fair value measurements of assets and liabilities [line items] | ||
Assets | $ 109 |
Financial Instruments and Fai_4
Financial Instruments and Fair Value Measurements - Summary of Financial Instruments and Fair Value Measurements (Parenthetical) (Detail) $ in Millions | 12 Months Ended |
Dec. 31, 2021USD ($) | |
Disclosure of fair value measurements of assets and liabilities [line items] | |
Commodity put options realized loss | $ 23.9 |
Commodity put options unrealized loss | 5.9 |
Commodity Out Options [Member] | Level 2 of fair value hierarchy [member] | |
Disclosure of fair value measurements of assets and liabilities [line items] | |
Commodity Put Options Current | $ 0.1 |
Financial Instruments and Fai_5
Financial Instruments and Fair Value Measurements - Summary of Contractual Maturities of Financial Liabilities (Detail) - USD ($) $ in Thousands | Dec. 31, 2021 | Dec. 31, 2020 |
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Trade and other payables | $ 384,488 | $ 390,059 |
Expected lease liability | 31,785 | 20,957 |
Borrowings | 4,997,289 | 5,188,880 |
Total | 5,413,562 | 5,599,896 |
Gross carrying amount [member] | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Trade and other payables | 384,488 | 390,059 |
Expected lease liability | 25,435 | 16,868 |
Borrowings | 4,157,344 | 4,184,911 |
Total | 4,567,267 | 4,591,838 |
Not later than one year [member] | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Trade and other payables | 384,488 | 390,059 |
Expected lease liability | 10,727 | 1,121 |
Borrowings | 564,742 | 204,035 |
Total | 959,957 | 595,215 |
Later than one year [member] | Later than four years and not later than five years [member] | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Trade and other payables | 0 | 0 |
Expected lease liability | 20,752 | 19,631 |
Borrowings | 3,059,498 | 2,935,929 |
Total | 3,080,250 | 2,955,560 |
Later than five years [member] | ||
Disclosure of maturity analysis for non-derivative financial liabilities [line items] | ||
Trade and other payables | 0 | 0 |
Expected lease liability | 306 | 205 |
Borrowings | 1,373,049 | 2,048,916 |
Total | $ 1,373,355 | $ 2,049,121 |
Financial Instruments and Fai_6
Financial Instruments and Fair Value Measurements - Additional Information (Detail) $ in Millions | 12 Months Ended | |
Dec. 31, 2021USD ($)T | Dec. 31, 2020USD ($)T | |
Foreign exchange risk [member] | Mongolian Tugrik [member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Foreign exchange gain (loss) | $ 20.4 | $ 19.2 |
Interest rate risk [member] | London Interbank Offered Rate (LIBOR) [member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Calculated change in net earnings due to 100 basis point increase in LIBOR interest rates | $ 41.5 | $ 40.7 |
Commodity price risk [member] | ||
Disclosure of fair value measurement of assets [line items] | ||
Copper in concentrate, sales | T | 21,800 | 29,400 |
Key Management Compensation - S
Key Management Compensation - Schedule of Key Management Compensation (Detail) - USD ($) $ in Thousands | 12 Months Ended | |
Dec. 31, 2021 | Dec. 31, 2020 | |
Disclosure of key management personnel compensation [abstract] | ||
Salaries, director fees and other short term benefits | $ 6,776 | $ 3,186 |
Post-employment benefits | 193 | 293 |
Share based payment | 1,412 | 1,628 |
Total | $ 8,381 | $ 5,107 |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) - USD ($) $ in Millions | Jan. 26, 2022 | Jan. 25, 2022 | Aug. 31, 2022 | Jan. 24, 2022 | Jan. 22, 2022 |
Government of Mongolia [Member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Loan waived | $ 2,363 | ||||
Investments accounted for using equity method | 1,399 | ||||
Interest accrued | $ 964 | ||||
Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | $ 650 | $ 1,700 | |||
Senior Supplemental Debt [Member] | Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | 500 | ||||
Senior Supplemental Debt Co Lending Facility [Member] | Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | $ 750 | ||||
Short term Secured [Member] | Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | $ 300 | ||||
ShortTerm Secured Colending Facility [Member] | Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | $ 750 | ||||
Equity Offering [Member] | Amended and Restated Heads of Agreement | Parent [member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Line of credit facility maximum borrowing capacity | $ 1,500 | ||||
Nonadjusting Events After Reporting Period [Member] | |||||
Disclosure of non-adjusting events after reporting period [line items] | |||||
Electricity supply agreement extension period | 3 years | ||||
Electricity supply agreement end year | 2026 | ||||
Electricity supply agreement original expiration month year | 2023-07 |