Miner Turquoise Hill (NYSE:TRQ) announced it will move forward with the rights offering it began mulling over two weeks ago, looking to raise $2.4 billion by doubling its share count at a 42% discount to where the stock closed on Monday.

Having to pay back Rio Tinto (NYSE:RIO) on a $600 million bridge funding facility as well as $1.8 billion in interim funding by the end of the year, Turquoise Hill has stumbled in its negotiations with the Mongolian government over a financing agreement for its Oyu Tolgoi copper-gold project located in the Gobi desert.

At issue are charges made by the government that Rio Tinto is running up the tab on the operation. The miner anticipates Oyu Tolgoi will cost some $5.1 billion; but this past July, it announced it was suspending work on a planned underground expansion of the mine. Turquoise Hill was subsequently forced to suspend its work there this month, as well, because of the financial difficulties surrounding it.

Rio Tinto, one of the world's largest mining companies by market value, and second only to BHP Billiton, owns almost 51% of Turquoise Hill, which owns two-thirds of Oyu Tolgoi. (The Mongolian government owns the other third of the mine). It hasn't been able to secure $4 billion in provisional financing this year for the next phase of expansion of the project, which is one of the five largest copper projects in the world that is expected to produce more than 1.2 billion pounds of copper, 650,000 ounces of gold, and 3 million ounces of silver annually over the mine's life.

Under the terms of the rights offering, Turquoise Hill will use the proceeds to repay all outstanding amounts with Rio Tinto, and to use any remaining funds for the continued financing of the Oyu Tolgoi project. Any shares left over from the offering, which will be priced at $2.40 each, a 42% discount to their $4.16 per-share closing price on Nov. 25, will be acquired by Turquoise's majority owner.

When Turquoise Hill reported third-quarter earnings earlier this month, it recorded a net loss of $94 million, or $0.09 per share, worse than Wall Street's expectations of a $0.05 per-share loss. Over the next year, the miner will have to pay back to Rio Tinto $2.02 billion, but analysts estimate it only has about $102 million in cash on its balance sheet.

It's a delicate time for Turquoise Hill, which earlier divested itself of a 56% stake in Inova Resources, and is in the process of selling its 50% stake in Altynalmas Gold, a private company developing the Kyzyl Gold Project in Kazakhstan. It's going all-in on Oyu Tolgoi; that is, as long as it can keep meeting the table stakes that Mongolia keeps raising.