The world’s second largest miner reported a $4.93 billion underlying profit in the six months to June, up 12% on the same period last year — its best half-year earnings since 2014.

It also said it would raise its interim dividend to $1.51 a share from $1.27 a share a year ago, continuing to benefit mining investors amid prices for iron ore trading above $120 a tonne, their highest in more than five years.

Net profit, however, dropped by 6% to $4.13 billion as Rio wrote down $800 million from its investment in an underground expansion at Oyu Tolgoi, located in Mongolia’s southern Gobi Desert.

The impairment was considerably higher than the $597 million booked on Wednesday by the mine’s operator, Canada’s Turquoise Hill (TSX, NSYE: TRQ), which is 50.8% owned by Rio and holds a 66% stake in Oyu Tolgoi..

Rio warned last month the project would take 16-30 months longer than expected and cost as much as an additional $1.9 billion to the projected $5.3 billion investment, due mainly to a heightened risk of rockfalls.

The company has also faced challenges at its iron ore mines in the Pilbara, with its production guidance previously downgraded for 2019 because of severe weather and mine planning issues at its Greater Brockman Hub.

“We have operational issues, but this is mining,” chief executive Jean-Sébastien Jacques said.

Despite the problems, most of Rio’s revenue in the period was generated by its iron ore operations, with underlying earnings from the division up a whopping 33%, compared to the same period last year, to $7.55 billion.

Under Jacques, who took over from former boss Sam Walsh in July 2016, Rio has focused on cutting costs, generating cash and returning as much of it as possible to investors through dividends and share buybacks.

Copper boost
The mining giant also provided an update on its Winu discovery in Western Australia, which could be the company’s next major copper project.

It has so far drilled 42 holes at the site and will continue extensive drilling in months to come as part of its $250 million exploration program. The objective is to determine whether Winu is “Tier 1” asset.

The copper-gold-silver asset is about 130 km. from Newcrest’s Telfer copper-gold mine in the East Pilbara. It’s also close to numerous copper prospects discovered recently by juniors and 350 km southeast of Port Hedland, the world’s largest bulk export port.

Rio Tinto believes the copper market will go into deficit by 2020 amid expectations that bigger power grids around the world and an electric-vehicle boom will boost demand, while supplies will remain constrained.