Tuesday, June 15, 2010

[CPS NewsWire, Tuesday, June 15, 2010]

Mongolia aims to list gold mine; seeks LSE, Nasdaq help

June 15 (Reuters) - Mongolia plans to list its Oyu Tolgoi mine, one of the world's biggest untapped copper and gold deposits, and is receiving proposals from global stock exchanges to assist with turning its state-run stock market into a private enterprise, a government official said on Tuesday.

Mongolia hoped to list Oyu Tolgoi on the domestic exchange and an international one, Sugar Dulam, chairman of the State Property Committee of Mongolia, said at the Mongolia Capital Raising Conference.

Dulam also said that Mongolia planned to list Tavan Tolgoi, one of the world's largest untapped coal deposits. He added that the London Stock Exchange, the Nasdaq and the Hong Kong Stock Exchange were among the groups that had submitted proposals to Mongolia to assist in privatising its exchange.

Hunnu Coal commences drilling at the Unst Khudag Coal Mine

June 15 (Fortbridge) Hunnu Coal (ASX: HUN) has commenced an exploration and development drilling programme at the 60% owned Unst Khudag Coal Mine and surrounding exploration licenses.

Key points:
·    The Unst Khudag Coal Mine is strategically located 200km from an operational multi party coal loading facility on a major rail line.
·    Consists of two Exploration Licenses and one Mining License covering over 59,000 hectares of area.
·    Approved Mining Plan and Feasibility Study for the mining of 98.7Mt of coal.
·    Hunnu is targeting first production from the Unst Khudag Coal Mine in the latter half of 2010.
·    Off-take agreements are currently being negotiated with Mongolian and Chinese thermal coal users.
·    Exploration Target of 250Mt to 500Mt
·    Past trial production of approximately 30,000t for bulk test work with potential off-take partners and to local customers
·    Single coal seam with average thickness of 20 metres dipping at 0 to 5 degrees.
·    Coal at less than 4 metres from the surface.
·    Low strip ratio mine start up at less than 1:1.
·    Coal analysis reveals a high quality thermal coal with quality parameters in average Qdaf = 6,460 kCal/kg, Ash = 13.9% and Moisture content = 23.9%.
·    Three drilling rigs currently operating on site.

(Mogi: CPS Securities was the lead manager in Hunnu's successful February IPO)

ASX Release:

MERITUS MINERALS LTD. will acquire a 20% interest of Gutain Davaa

June 14 (Marketwire) TSX Venture Exchange has accepted for filing a Share Sale & Purchase Agreement dated March 18, 2010 between Meritus Minerals Ltd. (the 'Company') and U and B LLC (Bulgan G.), whereby the Company will acquire a 20% interest of Gutain Davaa, a Mongolian LLC, which hold exploration licenses over the Gutain Davaa Project located 500 kilometers northeast of Ulaan Baatar in the South Hentii Metallogenic Belt of North East Mongolia.

Total consideration consists of US$105,000 in cash payments and 1,750,000 warrants exercisable into shares of the Company at $0.25 for the first year, $0.35 for the second year, and $0.50 for the third year.

EBRD has 18.46% stake in Petro Matad

June 14, Business Financial Newswire - The European Bank for Reconstruction and Development holds an 18.46% stake in Mongolia-focused oil explorer Petro Matad.

EBRD has completed the second and final $3m tranche of a $6m subscription agreed in December.

Petro Matad said it had also issued 18,750 shares following the exercise of options held by an employee under the firm's employee share scheme.

Foreign dollars for Mongolia boost

Mongolia is looking for foreign investors to help it boost domestic crude oil production tenfold in the next three years, a senior Mongolian diplomat said today.

June 15 (upstreamonline) The increase in crude production to 10 million barrels a year from 1 million in 2009 would coincide with construction of Mongolia's first oil refinery, enabling the land-locked country to reduce its dependence on neighbouring Russia for gasoline and other refined petroleum goods, Mongolia's ambassador to Australia, Tserendorj Jambaldorj, told Reuters.

"We have a plan to build a refinery in Mongolia in order to not be dependent on imports."

ANSI's participation in Mongolia bolsters international cooperation

June 14 (ANSI) The Pacific Area Standards Congress (PASC) held its 33rd meeting on May 29-30, 2010, in Ulaanbaatar, Mongolia. The American National Standards Institute (ANSI) participated alongside 13 other national standards bodies, as well as the Secretary-General of the International Organization for Standardization (ISO), the president of the International Electrotechnical Commission (IEC), and representatives from the United Nations Industrial Development Organization (UNIDO) and the International Telecommunications Union (ITU).


Rattled Rudd to make miners an offer

June 15 (The Sydney/Morning Herald) The federal government believes it is close to reaching agreement with sectors of the mining industry over its proposed super profits tax in the hope it can take some of the heat out of the issue and ease the pressure on Kevin Rudd's leadership.
As MPs arrived in Canberra yesterday for what will be a critical parliamentary fortnight for Mr Rudd, some warned that the discontent they had picked up in their electorates last week indicated it would take more than fixing the mining tax to restore Labor's fortunes.

It is understood he and Mr Rudd are close to an agreement on transitional arrangements, which will mollify some companies but not the big players such as BHP Billiton and Rio Tinto.

Shares flat in directionless trade

June 15 (Business Day) Close. Australian shares ended the day flat amid choppy trading that lacked clear direction, with defensive sectors benefiting as investors remained jittery after a debt downgrade for Greece.

At the close, the benchmark S&P/ASX200 index was down 0.5 points at 4505, while the broader All Ordinaries index inched up 1.1 points to 4517.6.

Volume was light after the three-day holiday weekend, and traders said investors were winding down ahead of the financial year end on June 30.

The Australian dollar fell in afternoon trade as the RBA remained cautious about the EU debt situation. The currency closed locally at $US0.8510, down over a cent from a high of $US0.8665 hit offshore.

The gold miners ended the day lower, with Lihir off 1 cent at $4.21 and Newcrest down 13 cents at $34.22.

Australian Mines was the most traded stock by volume. The base metals explorer was steady at 0.1 cents with 62.7 million shares traded for $66,540.

RBA flags rates freeze

June 15 (AAP) The Reserve Bank of Australia has signalled it remains in wait-and-see mode, at least until the June quarter consumer price index data in late July.

The RBA said in the minutes that the European troubles ''would inevitably weigh on prospects for global growth''.


China Leading Indicator Rises, Conference Board Says

June 15 (Bloomberg) -- A leading indicator for the Chinese economy, the world's third biggest, rose "sharply" in April on a jump in new construction work, The Conference Board said.

The measure gained 1.7 percent to 147.1, compared with a revised 1.2 percent increase in March, the New York-based research organization said on its website today.

The construction gain may "prove transitory" because of extra government measures from mid-April to cool the real- estate market, said Bill Adams, resident economist for the organization in Beijing.

Adams' view was similar to last month, when he said that the "front-loading" of real-estate projects ahead of government controls probably helped to boost the measure.

Taiwan Shares to Rise on China, Union Securities Says

June 15 (Bloomberg) -- Taiwan shares may rise as much as 15 percent by the end of this year as the island pursues trade and investment agreements with China, according to Taiwan's second- best-performing fund.

The benchmark Taiex Index may advance to 8,500 in 2010, Alan Ho, manager of the Union China Fund at Union Securities Investment Trust Co., said in a telephone interview today. The index yesterday climbed 1.2 percent to 7,387.40, a three-week high, after the island and China reached an initial accord to boost trade worth about $110 billion a year.

The Taiex has fallen 9.8 percent this year amid concern Europe's sovereign debt crisis will lower demand for technology exports from Asia. UBS AG, Switzerland's biggest bank, in May cut its 2010 target for the index to 7,600, the second reduction in three months. HSBC Holdings Plc this month lowered its forecast by 20 percent to 8,000.

China will reform its exchange-rate mechanism based on developments in the global economy and its own economic performance, Qin Gang, spokesman for the Chinese foreign ministry, said in a statement on the ministry's website yesterday. China, the world's fastest-growing major economy, halted the currency's three-year advance against the dollar in July 2008 to help exporters weather recessions in the U.S., Europe and Japan.

China slams U.S. pressure on RMB exchange rate

BEIJING, June 14 (Xinhua) -- China on Monday urged the United States political figures to stop blaming others for U.S. economic problems and to solve the problems themselves, as pressure on the Renminbi exchange rate mechanism builds.

U.S. Treasury Secretary Timothy Geithner said at a congressional hearing last Thursday China's refusal to revalue its currency impedes global economic reforms -- even as he highlighted the importance of U.S.-China trade and hailed the recent growth of Chinese imports of U.S. products.


Asian Stocks Reverse Loss on Recovery Signs; Bond Risk Falls

June 15 (Bloomberg) -- Asia's stocks reversed earlier declines and bond risk fell on signs the European debt crisis hasn't hampered growth in China and as Japan extends loans to companies to strengthen its economy. The euro weakened.

The MSCI Asia Pacific Index climbed 0.1 percent to 114.26 at 3:28 p.m. in Tokyo, reversing a 0.3 percent drop on earlier on concern Greece's junk credit rating may curb demand.

Greece Cut to Junk by Moody's on 'Substantial' Economic Risks

June 15 (Bloomberg) -- Greece's credit rating was cut to non-investment grade, or junk, by Moody's Investors Service, threatening to further undermine demand for the debt-strapped nation's assets as it struggles to rein in its budget deficit.

Greece has cut spending, raised taxes and trimmed wages to tackle the deficit, which swelled to 13.6 percent of gross domestic product last year, more than four times the EU limit. To secure the EU-IMF aid, the government pledged to trim the shortfall to 8.1 percent of GDP this year and bring it back under the 3 percent EU ceiling in 2014. The crisis has prompted investors to sell the bonds of Greece and other high-deficit nations and pushed the euro down 15 percent this year.

"This doesn't look good and I expect another round of sell-off," said Christoph Rieger, co-head of fixed-income strategy at Commerzbank AG in Frankfurt, Germany's second- largest bank. "A junk status means it will fall out of some benchmark indices. People who use those benchmarks are likely to sell."

Afghanistan: rich in deposits, engulfed in danger

Afghanistan may be sitting on an estimated $1-trillion (U.S.) in untapped mineral deposits, but Canadian miners seem happy to let others take the lead in developing the discoveries.

Not only is Afghanistan one of the world's most war-ravaged countries, but there is also the issue of how to transport commodities out of the landlocked country.

"The risk is too high, regardless of the quality of the ore bodies," said Paul Blythe, chief executive officer of copper producer Quadra FNX Mining Ltd. of Vancouver.

According to the Pentagon, iron accounts for almost half of the country's estimated mineral value, or $420-billion (U.S.). Copper comes second, with about $273-billion.

A New York Times article on the discovery quotes an internal Pentagon memo stating Afghanistan could become the "Saudi Arabia of lithium," a material used in everything from batteries to BlackBerrys.

Veteran mining financier Robert Friedland, who has developed mining projects in such challenging locations as Mongolia and the Democratic Republic of Congo, is unconvinced about the potential for mining in Afghanistan.

"Hopeless," Mr. Friedland said in an e-mail to The Globe and Mail .

"Lithium is common as chips. The trillion dollar number is meaningless. ... Absurd," he added.

In 2008, state-owned conglomerate China Metallurgical Group Corp. won a crowded auction for the right to develop the Aynak copper deposit in Afghanistan, believed to be one of the largest untapped copper projects in the world.

UK fiscal watchdog cuts growth outlook

June 14 (Reuters) - The newly created budget watchdog downgraded economic growth forecasts on Monday but did not radically alter the scale of austerity measures required from the country's coalition government.

The economy will grow more slowly after this year than the previous Labour government expected but state borrowing will fall a bit faster than originally thought partly due to recent higher tax receipts, the Office for Budget Responsibility said.


Cash for work - Asia's answer to crises

June 14 (Rediff) Mongolian herders and rural Indians, two seemingly disparate peoples, could provide valuable insights for other countries in Asia. Both groups have suffered from multiple crises and both are climbing their way out through innovative schemes that offer a hand up instead of a handout.

In Mongolia, an initiative sponsored by the UNDP is offering hope and a future to thousands of herders who are trying to reboot their lives after the worst winter that anyone can remember, which killed more than 8.5 million goats, sheep, horses, camels, yaks and cows, leaving the herders without income.

Through a cash-for-work project, herders will earn a decent wage for removing and burying the carcasses. It is much-needed money at a time when debts are due and supplies are running low. This money will also take care of herders' immediate needs during this difficult period - for food, medicines, children's clothing and heating.

Compensating Siberia internees

June 13 (Japan Times) Some 600,000 Japanese are believed to have been interned in Siberia, Mongolia and Central Asia and used for forced labor after World War II. Some 60,000 of them are estimated to have died. Of the more than 460,000 who came back to Japan, 70,000 to 80,000 of them are believed to be still alive. Their average age is thought to be about 87.

… On May 20, the Upper House Internal Affairs and Communications Committee unanimously passed a bill to give allowances to them and sent it to the Lower House the next day. …

Under the bill, the former POWs are divided into five categories depending on the length of their internment — the longest being 11 years. If enacted, the bill will go into effect on the day it is promulgated. A one-time allowance ranging from ¥250,000 to ¥1.5 million will be paid to former POWs who are alive on that day. If they die later, their families can get the allowance. The bill only covers Japanese and does not cover people who were from Japan's former colonies and were interned — an issue that requires future government action.

"Mogi" Munkhdul Badral

CPS Mongolia


Mobile: +976-99996779


CPS Mongolia is a marketing arm of CPS Securities in Mongolia. CPS Securities is a Perth, Western Australia based ASX Licensed Financial Services Company. To trade ASX stocks, feel free to contact me at or +976-9999-6779.

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