MONTREAL, November 26, 2020 /PRNewswire/- Turquoise Hill Resources Ltd. (“Turquoise Hill” or the “Company”) today issued the following statement regarding the published letter to Rio Tinto plc from Odey Asset Management LLP, a short-seller in Turquoise Hill’s stock and claiming to be a shareholder of Rio Tinto who, in stark contrast and opposition to our shareholders, profits from a decline in Turquoise Hill’s share price:
“Odey’s letter to Rio Tinto contains a number of false assumptions and misinformation about Turquoise Hill and its funding plan. While Odey has a clear financial motive to depress Turquoise Hill’s share price, the Company is focused on executing its funding plan and maximizing value for
shareholders.”
“Turquoise Hill’s management team and independent directors have previously announced a funding plan that seeks to maximize debt at the Oyu Tolgoi LLC level and minimize (or possibly even avoid) a rights offering, for the benefit of Turquoise Hill shareholders. We are pursuing tangible measures
to execute on that plan, including engaging with Rio Tinto and our minority shareholders, markettesting debt and hybrid financing alternatives and initiating arbitration to clarify Rio Tinto’s obligations to Turquoise Hill.”
“The funding Memorandum of Understanding between Rio Tinto and TRQ (the “funding MOU”) remains in place and continues to reflect the understandings between the parties as to fundingrelated matters. Work is ongoing to implement the funding MOU in full. Neither TRQ nor Oyu Tolgoi
LLC has any intention or plan to prepay or refinance Oyu Tolgoi LLC’s existing US$4.4 billion project finance facilities (with proceeds of a rights offering or otherwise). This facility is expected to remain in place until its maturity. Contrary to Odey’s misleading assertions, Rio Tinto has no right to require
the prepayment, refinancing or “removal” of Oyu Tolgoi LLC’s existing project finance facilities.”
“Odey mischaracterizes important aspects of the existing financing arrangements for the Oyu Tolgoi project, including the basis on which Rio Tinto has provided a completion support undertaking (CSU) to the project lenders. Rio Tinto does not, in fact, “subsidize” TRQ through the provision of this CSU or otherwise. The CSU is a limited, contingent commitment for which Rio Tinto is paid agreed CSU fees until “project completion,” the achievement of which is largely within Rio Tinto’s control as manager of the Oyu Tolgoi project (and in which capacity Rio Tinto also receives management fees). From 2012 through 30 September 2020, cumulative CSU fees paid to Rio Tinto amounted to approximately US$ 250 million, and cumulative management fees paid to Rio Tinto amounted to
approximately US$ 360 million (including approximately $115 million in cumulative management fees capitalized).”
“If the full re-profiling of Oyu Tolgoi LLC’s existing project loans is achieved and Senior Supplemental Debt in the amount of US$500 million is raised (as contemplated by the funding MOU), the Company then estimates an additional US$ $1.1 billion would need to be sourced from further bank debt,
bonds or metal streaming to fully fund Oyu Tolgoi LLC. In this scenario, no equity would be required (based on the assumptions underlying Turquoise Hill’s most recent public disclosures). If neither the re-profiling nor any additional debt (including Senior Supplemental Debt) or hybrid financing is
completed, Turquoise Hill expects that it would need to raise additional equity of at least US$3.0 billion (based on the same assumptions).”
“Contrary to Odey Asset Management’s misleading assertions, in practice, Rio Tinto’s right under the 2015 financing support agreement to initiate a process potentially leading to a mandatory Turquoise Hill rights offering can, under the terms of the agreement, be countered by Turquoise Hill either certifying it has at least 180 days of cash resources or presenting a commercially viable
alternative funding proposal. As a practical matter, the earliest time a rights offering could be triggered is estimated to be around December 2021, being approximately six months prior to Turquoise Hill’s cash resources being depleted. As of September 30, 2020, Turquoise Hill is forecast
to have adequate cash resources to meet the requirements of the Company, including its operations and underground development, into Q2 2022.
Assuming successful re-profiling of the existing project debt, the Company estimates that Oyu Tolgoi will begin to generate sufficient cash flow to fully fund its operations (including any capital expenditure requirements and assuming successful re-profiling of existing project debt as previously
disclosed) and to meet its debt service obligations approximately 12-14 months after October 2022 (the estimated timing for the achievement of sustainable first production). Turquoise Hill is, consistent with its previously announcedfunding strategy, actively taking steps to address its funding
gap (in whole or in part) and to extend its liquidity depletion date by examining and evaluating various financing options for the Oyu Tolgoi project. Such options include additional debt from banks or international financial institutions, an offering of global medium-term notes and a gold streaming
transaction.”
“Turquoise Hill has not failed in any way to deliver the Oyu Tolgoi project; the project is exclusively managed by a subsidiary of Rio Tinto plc pursuant to the terms of a management agreement.”

tijd 16.22
Turquoiese Hill Today vol. 16.200
Time X Price Chg Vol Buyer Seller Markers
10:04:14 M 12.69 +0.12 200 79 CIBC 7 TD Sec
10:04:00 X 12.66 +0.09 100 1 Anonymous 1 Anonymous K
10:02:49 T 12.66 +0.09 100 33 Canaccord 1 Anonymous K

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Regulators worldwide must prohibit short-selling.