NEW YORK, NY / ACCESSWIRE / November 28, 2020 / Pomerantz LLP is investigating claims on behalf of investors of Turquoise Hills Resources Ltd. ("Turquoise Hills" or the "Company") (NYSE:TRQ). Such investors are advised to contact Robert S. Willoughby at email@example.com or 888-476-6529, ext. 7980.
The investigation concerns whether Turquoise Hills and certain of its officers and/or directors have engaged in securities fraud or other unlawful business practices.
On February 26, 2019, Turquoise Hill disclosed that although "the project cost" for the Company's Oyu Tolgoi mine in Mongolia "was expected to remain within the $5.3 billion budget," a review had determined that "there was an increasingly likely risk of a further delay to sustainable first production beyond Q3‘21." Turquoise Hill attributed the "likely risk" to productivity delays in completing Shaft 2 and "challenging ground conditions that have had a direct impact on the project's critical path." On this news, Turquoise Hill's stock price fell $2.10 per share, or 12.68%, to close at $1.83 per share on February 27, 2019.
Then, on July 15, 2019, Turquoise Hill issued a press release announcing a further delay and that the underground project would cost substantially more than the Company had earlier stated. Sustainable first production from the underground development of Oyu Tolgoi would now be delayed by a further nine to twenty-one months until May 2022 to June 2023, and "the development capital spend for the project may increase by $1.2 to $1.9 billion over the $5.3 billion previously disclosed." Turquoise Hill attributed the change to "[i]mproved rock mass information and geotechnical data modelling," which "confirmed that there are stability risks associated with components of the existing mine design." Turquoise Hill disclosed that the issues with the mine design were sufficiently unsettled that it would take until the second half of 2020 to develop a revised design for the mine.
Finally, on July 31, 2019, Turquoise Hill issued a press release and Management Discussion & Analysis making further disclosures about the status of the project, including that Turquoise Hill took a $600 million impairment charge and a substantial "deferred income tax recognition adjustment" tied to the Oyu Tolgoi project, and that it suffered a loss in the second quarter. The next day, pre-market, Rio Tinto issued a release concerning in part the project status, disclosing that it had also taken an impairment charge of $800 million related to the Oyu Tolgoi project. On this news, Turquoise Hill's stock price fell $0.05 per share, or 8.62%, to close at $0.53 per share on August 1, 2019.
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SOURCE: Pomerantz LLP
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