Turquoise Hill Resources Ltd. (“Turquoise Hill” or the “Company”) announced the completion and delivery by Rio Tinto of the Definitive Estimate, which refines the analysis contained in the feasibility study underlying the Company’s Oyu Tolgoi Technical Report (“OTTR20”) dated and filed on August
28, 2020. The results of the Definitive Estimate include:
• a revised base case project development capital cost estimate of $6.75 billion1
• confirmation that sustainable first production is forecast to occur in October 20221
• verification that all surface infrastructure required for sustainable first production is now complete
• an increase in Hugo North Mineral Reserves of 10Mt, 0.18Mt contained copper and 0.07Moz contained gold

The level of work and scope of the review were completed to an accuracy range of -5% to +10%, but given the uncertainty of COVID-19-related risks and other business case risks the go-forward capital expenditure estimate and schedule set out in the Definitive Estimate, as approved by the Company’s board, are at a -10% to +15% level of accuracy. The Definitive Estimate assumes
COVID-19 related restrictions in 2021 that are no more stringent than those experienced in September 2020. Should COVID-19 constraints continue beyond 2021, or should the COVID-19
situation escalate further in 2021 leading to tougher restrictions, additional costs and schedule impacts may arise. TRQ understands that the business case risks identified by Rio Tinto relate to: Government approvals of the Oyu Tolgoi feasibility study (OTFS20) and supporting documents;
achievement of certain milestones identified in the amended Power Source Framework Agreement (“PSFA”); and implementation of the Memorandum of Understanding (“MOU”) between Turquoise Hill and Rio Tinto relating to funding.
The Definitive Estimate is yet to be considered and approved by the board of directors of Oyu Tolgoi LLC. In the interim, Turquoise Hill is committed, over the coming months, to working closely with Erdenes Oyu Tolgoi LLC (“Erdenes”), the Government of Mongolia, Rio Tinto and Oyu Tolgoi LLC:

1 Key assumptionsunderlying this information remain materially aligned with OTTR20

• to address the concerns of Erdenes and the Government of Mongolia with respect to the reasons for the cost overruns and delays to the underground development announced in 2019, including through the independent review being overseen by a Special Committee of the Oyu Tolgoi LLC board as announced on December 1, 2020;
• to support the achievement by Oyu Tolgoi LLC and the Government of Mongolia of their joint PSFA milestones, including reaching agreement on a power purchase agreement for a state-owned power plant by March 31, 2021 and securing agreement on an extension of Oyu Tolgoi LLC’s existing power import arrangements by March 1, 2021;
• to seek clarity and stakeholder alignment on the criteria to be satisfied prior to commencement of the “undercut” 2 (such as confidence in commissioning dates for the materials handling system and the extension of power import arrangements), and Ensure that such criteria are met in a timely manner; and • to secure stakeholder alignment on, and timely implementation of the proposed re-profiling of Oyu Tolgoi LLC’s existing project loans and the raising of supplemental senior debt (as
contemplated by the MOU), as well as Turquoise Hill’s preferred strategy of prioritising debt and/or hybrid financing to meet Oyu Tolgoi’s funding requirements.
“The Definitive Estimate confirms the economics detailed in the OTTR20 we announced in August,”
stated Ulf Quellmann, Chief Executive Officer of Turquoise Hill. “TRQ continues to work closely with our valued partners, Erdenes and the Government of Mongolia, as well as Oyu Tolgoi and Rio Tinto to deliver the underground development and realise the full potential of Oyu Tolgoi for the benefit of all stakeholders.”

Operational Update
The schedule optimisation and design updates contained within the Definitive Estimate revise the mdevelopment capital to $6.75 billion and confirm sustainable production by October 2022, which are broadly in line with Turquoise Hill’s previous disclosures. The Definitive Estimate includes a contingency on the to-go capital of approximately 13% as well as a four-month schedule contingency to sustainable first production. These estimates now include the known and forecast impacts of COVID-19. As part of the Definitive Estimate, open pit optimisation work has been updated with an updated phase sequence that accelerates copper production, improving value for the overall operation.
Further mine design analysis undertaken as part of the Panel 0 update has modified and finalised the pillar location to the South of Panel 0. This update minimises production exposure to stability risks associated with the lower fault, increases the overall mineral reserves and consequently decreases mineral resources due to the reclassification, as follows:

2 The commencement of the “undercut,” currently scheduled for mid-2021, is a key milestone, signifying the point at which caving
operations and drawpoint construction activities must continue uninterrupted

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