Sanjaagiin Bayar, prime minister between 2007 and 2009, negotiated Rio Tinto's initial investment after it took over the mine from Canadian-listed developer Ivanhoe Mines. Saikhanbileg Chimed, who held office between 2014 and 2016, oversaw negotiations for the second, and more expensive, underground stage.

Both are now in custody, according to a statement on Wednesday from Mongolia’s anti-corruption authority, which last week requested that Mr Saikhanbileg return from the US to respond to questions.

Neither man could be immediately reached for comment.

The development of the enormous mine has been accompanied by years of fraught negotiations between Mongolia and Rio, including Ulan Bator's rapidly changing policies on foreign mining investment and allegations of cost overruns against the global miner.

Mongolia needs the proceeds from the mine to meet its national budget, but won't see the bulk of the revenue flow until Rio is compensated for its expenses and financing costs. Rio is financing the Mongolian state’s share of the investment in the mine at commercial rates, adding to the tension.

The mine has also exposed divisions within Mongolia between those who wanted the state to take a direct share and those who argued that the state should limit itself to collecting taxes. The promise of windfall proceeds inspired political parties to make rash spending commitments, adding to Mongolia's fiscal woes during a prolonged commodities downturn.

The arrests in Mongolia come as Rio Tinto faces investigations into payments made to a French consultant to secure a large iron ore mine in Guinea.