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(Corrects paragraph 5 to show Kinnell not in charge in Sept 2013.)
By Terrence Edwards
ULAN BATOR, Sept 4 (Reuters) - Global mining giant Rio Tinto has appointed a new chief executive for the $6.5-billion Oyu Tolgoi copper-gold deposit in Mongolia as it bids to restart construction for the long-postponed second phase of the project.
Rio Tinto executive Andrew Woodley will become president and chief executive officer, replacing Craig Kinnell, who is leaving for personal reasons, according to a press release issued by Oyu Tolgoi LLC on Thursday.
Kinnell will hand over duties to Woodley in October and will move on to a new role with Rio Tinto in London the following month, the release said.
Woodley will move to Ulan Bator after heading up Rio Tinto's coal business in Mozambique, which the company bought for $4 billion in 2011 and sold for just $50 million after failing to secure approval to barge coal to an export port.
Kinnell was regarded in the industry as a short-term appointment aimed at driving through job cuts. He was not in charge during a first round of 1,700 redundancies in September 2013, but oversaw 300 job cuts in May.
Rio's majority owned Turquoise Hill Resources, which owns 66 percent of Oyu Tolgoi, is currently embroiled in a tax dispute with the Mongolian authorities over a $130 million bill delivered in June.
The dispute is the latest in a series of hurdles facing the Oyu Tolgoi project since Rio Tinto suspended construction of the underground section of the mine in August 2013.
Rio is waiting for the project's board to approve a feasibility study ahead of a September 30 deadline for a $4 billion project financing package that will fund construction.
The Mongolian government owns the remaining 34 percent of Oyu Tolgoi and has representatives on the mining unit's board of directors.
"As long as the tax dispute with the government of Mongolia is ongoing, a resolution to the second phase of this project will not be forthcoming," said Neil Ashdown, deputy head for Asia for IHS Country Risk on the sidelines of the Discover Mongolia investment conference in Ulan Bator.
He added that delays around the expansion of Oyu Tolgoi were deterring other foreign investors, and he did not expect to see a big increase in foreign investment into Mongolia at present. (Additional reporting by Sonali Paul in MELBOURNE,; Editing by David Stanway and Richard Pullin)