Rio Tinto's Oyu Tolgoi mine faces regulatory investigation

British financial regulators are investigating Rio Tinto and its $6.75 billion underground copper project Oyu Tolgoi in the Gobi Desert in Mongolia.

The Financial Conduct Authority ((FCA)) is investigating whether the Anglo-Australian mining company violated listing rules when it disclosed the value of Oyu Tolgoi in 2018 and 2019, according to people familiar with the matter.

Earlier this year, Rio Tinto reached a binding agreement with Turquoise Hill Resources Ltd on funding for the expansion of copper and gold mines, which faced a stack of costs and timetables and sparked disputes between the mining giants and their junior partners.

The expansion of Oyu Tolgoi, Rio's largest copper growth project, soared costs to $6.75 billion, about $1.4 billion higher than Rio estimated in 2016 and led to financial friction with Turquoise Hill.

FCA and Rio Tinto declined to comment.

Oyu Tolgoi is one of the most famous copper and gold deposits in the world, with a 34 per cent stake in the Mongolian government. The rest is held by Turquoise Hill, of which Rio Tinto has a 50.8 per cent stake.