US markets rise, Dec. 9-13: Rio Tinto, Newmont Goldcorp

The Dow Jones Industrial Average rose 0.43% to 28,135.38 and the S&P 500 Index gained 0.73% to 3,168.80. Spot gold climbed US$16 per oz. to finish at US$1,475.70 per ounce.

Shares of Rio Tinto jumped US$2.35 to US$57.72 on news about its Oyu Tolgoi mine in Mongolia. The company announced unanimous approval of a resolution by the Mongolian parliament that instructs the government to look for ways to better implement the 2009 investment agreement, the 2011 amended and restated shareholder agreement, and the 2015 underground mine development and financing plan.

“The passing of this resolution effectively reconfirms the validity of all the investment agreements between the Government of Mongolia, Rio Tinto and Turquoise Hill Resources,” Rio Tinto said in a press release. “This brings to a close an over 18-month review by the Parliamentary Working Group of Oyu Tolgoi and the investment agreements governing the business.” Commenting on the resolution, Arnaud Soirat, chief executive of Rio Tinto’s copper and diamond division, noted that “adherence to these agreements by all parties has underpinned a total in-country spend of around $10 billion since 2010, which has delivered significant benefits to the people of Mongolia and will continue to do so for decades to come.” The resolution was officially published by the Government of Mongolia on Dec. 10.

News that Newmont Goldcorp had reached an agreement on a water pact at its Penasquito mine in Mexico sent its shares up to $41.29 apiece, representing a $1.49 gain. The mining company and the San Juan de Cedros community (one of 25 neighbouring communities) in Zacatecas mutually agreed to an infrastructure solution securing sustainable water availability for the community’s domestic and agricultural uses. The 30-year water agreement represents  a “significant milestone and an important step in the ongoing negotiations between the parties,” the company stated. The plan includes additional water wells and infrastructure that will supplement the 600,000-litre-per-day, reverse-osmosis drinking water plant and wells the company built in 2018 and continues to operate. The public water system and the distribution networks will ultimately be owned by the municipality.