Progress at OT, but at a price

Research evidence excerpt

Progress at OT, but at a price

Deutsche Bank Group

Deutsche Numis Research

Rating Company Date

Hold Rio Tinto 30 June 2026

Company Update

Europe

United Kingdom

Reuters Bloomberg Exchange Ticker Price at 29 Jun 2026 (GBP) 7,076.00

RIO.L RIO LN LSE RIO

Price Target (GBP) 7,400.00

Metals & Mining

Metals & Mining ADR ISIN 52-week range (GBP) 8,308.004,245.00-

RIO US7672041008

Valuation & Risks

Liam Fitzpatrick

Progress at the OT project in Mongolia Research Analyst

Earlier today, RIO announced an agreement with the Government of Mongolia to +44-20-754-13233

reduce the shareholder loan interest rate for the Oyu Tolgoi project (OT) from 6.5%

Bastian Synagowitz

to 4%, in line with the Shareholders Agreement requirement to periodically review Research Analyst

the rate. Shareholder funding (from RIO to OT) was disclosed at $7.7bn in 2023 (Fig +41-44-227-3377

3) and may now exceed $10bn, reflecting project capex over the past three years.

Cody Hayden

This follows a May agreement to approximately halve the management fee paid by

Research Analyst

OT to RIO. RIO and the government have 66% and 34% stakes in OT, respectively.

+44-20-754-13230

The release also notes that the parties have agreed to work together to resolve

matters relating to the Entrée mine lease areas in a timely manner and to bring

forward distributions to shareholders. While the point on Entrée is clearly positive,

the proposed fast-tracking of dividends to the minority shareholder (i.e. the

government), together with the lower shareholder loan rate and reduced

management fee, shifts a greater share of OT economics to the government. The

changes to the interest rate and management free are immaterial to our RIO

valuation; however, equity distributions from OT could impact our FCF estimates