Novus Capital makes BUY recommendation for Hunnu Coal
June 21 (The Bull) --
A coal explorer in Mongolia, Hunnu has acquired several projects that are producing or close to it. Although only recently listed, the share price bounce from 60 cents to $1 has given the stock momentum. Assuming it can achieve its production goals, the stock may run to $2.
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Drilling Completed at Prophecy's Chandgana-Khavtgai Coal Project, Updated NI 43-101 Resource Report Is Expected by August
VANCOUVER, BRITISH COLUMBIA--(Marketwire - June 21, 2010) -- Prophecy Resource Corp. (TSX VENTURE:PCY)(PINK SHEETS:PRPCF)(FRANKFURT:1P2) is pleased to report the successful completion of its spring exploration program on its 100% owned Chandgana-Khavtgai license in Khentii aimag (province), Mongolia. The work program consisted of 12 drill holes for a total of 2,205 metres including 903 metres of core drilling, and five lines of seismic geophysical survey for a total of 7.4 line km.
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An existing Mineral Resource estimate for Chandgana Khavtgai is provided in the Technical Report prepared by Mr C. M. Kravits (2008) available at SEDAR.com. The Measured and Indicated Mineral Resources are 657 Mt. There is an additional 409 Mt of inferred Mineral Resources.
In addition to Chandgana Khavtgai, Prophecy also owns 100% of the 141 Mt Chandgana Tal coal project which is 9 km away within the Nyalaga basin. Prophecy is targeting a potential 1 billion tonnes of Measured and Indicated coal in the basin. A new NI 43-101 resource report incorporating the recent drilling is expected to be completed in August.
The Changana thermal coal deposits are located near the Mongolian power grid and could fuel a Mine Mouth Power Plant Complex which could provide power to Mongolia, Russia and China. Prophecy intends to commission a Power Plant/Mine complex study this year.
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Additional Information on Prophecy's Coal projects
Chandgana Khavtgai and Tal projects ("Chandgana")
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Ulaan Ovoo Project
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Runge opens Mongolian office, wins new contract
June 22 (QBR) Queensland-based mining technology services company Runge has won a significant scoping study contract for a Mongolian mining house just months before opening its own office within the country.
The contract for Oyuny Undra Holdings, which has a Tungsten/Lithium Project in the South East Mongolia, represents the largest single pure technical consulting job won by Runge North Asia business to date.
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“We have been working closely with Oyuny Undra Holdings since January this year, assisting them to bring this mining project up to International JORC Standard,” Baudry says.
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Japan, Mongolia to hold study group meeting on free trade accord
June 21 (Kyodo) Japan and Mongolia will hold two-day talks in Ulan Bator from Thursday to study whether the two countries should conclude a bilateral free trade agreement, the Japanese government said Monday.
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Japan - Joint Public-Private Research on a Japan-Mongolia Economic Partnership Agreement (EPA)
1. The Governments of Japan and Mongolia have agreed on starting joint public-private research on an economic partnership agreement (EPA). The first meeting will be held over two days from June 24 (Thu) to June 25 (Fri) in Ulan-Bator, to be attended by experts from industry, government, and academia of both countries.
2. During the first meeting, the experts will exchange views on topics including bilateral economic relations and items to be included in the possible EPA.
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TenGer Group acquires 50% of Prime General Insurance
June 21 (news.mn) TenGer Financial Group has acquired 50% of Prime General Insurance LLC, a leading insurer of the country. The remaining half is owned by Petrovis LLC. The acquisition is expected to help Prime Insurance strengthen its business position and become the leader in the field. U.Ganzorig, CEO of Prime Insurance, has said the move will help the company provide “comprehensive financial services to customers and to introduce a new standard in the financial sector of Mongolia”. J.Oyungerel, founder of Petrovis, has hailed the TenGer decision as a “clear example that well known private enterprises of Mongolia can successfully cooperate”.
Prime Insurance Company, one of the top three insurers of Mongolia, provides service to 700 companies and 11,000 individuals. TenGer Financial Group is the lead investor in Xac Bank, Xac Leasing, Xac Securities and Chorus Nomadic Solutions. Last year, it made its first international investment, in a Kyrgyz financial company, and plans to expand in the Russian Federation, Central Asian countries and China.
Among shareholders of the Group are EIT Capital Management, IFC, EBRD, Mercy Corps, Triodos Bank Group of Holland, Blue Orchard Investment Fund of Luxemburg and some domestic NGOs.
Railway gauge issue yet to be settled
June 21 (news.mn) Parliament discussed on Friday morning the government proposal on railway transportation, as slightly modified by a working group led by MP R.Rash. The main issue to be debated is the width of the gauge. This was the first reading, so no conclusion was reached.
MPs generally favored the plan to build the railway in three stages. The first of these will be from Tavantolgoi to Zuunbayan and from Sainshand to Choibalsan. L.Gundalai’s demand for a 400-km railroad from Erdenet to Murun city in Khuvsgul province was rejected by Minister Kh.Battulga who said meeting the needs of mining was more important now than developing tourism.
Opposing the broad gauge, D.Terbishdagva said it would be “wrong to use this old technology”. It would cost more and offer less benefit, he said. He urged the working group to take professional help in determining the economics of the project. The government favors the broad gauge as this would make for easier connectivity with Russia, when minerals will be exported.
The Standing Committee on the Economy was asked to prepare the draft for the next discussion.
Policy rate left unchanged
June 21 (news.mn) Central Bank directors have decided to keep the policy rate unchanged at 11 percent. With inflation threatening to go up there has been talk of a tighter monetary policy to restrict money suTpply, and to support the proposed revision to the budget.
The consumer price index was up 4.2 percent in May, 16.1 percent more than at the start of the year, and 11.7 percent more than in May last yea
Forum debates model mining agreement
June 21 (news.mn) The President’s Office last week organized a two-day conference on proper development of the mineral sector under the auspices of Davos Economic Forum, an organization set up under suggestions from President Ts.Elbegdorj. It was attended by representatives from the Government, investors, civil unions and experts in the field.
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Deputy Director of the Global Industry Center at the World Economic Forum, Alex Wong, said the work would take between 18 and 24 months to prepare a model as all existing agreements will first have to be studied thoroughly.
Leighton takes train to Mongolia's mining boom
(Mogi: A similar article titled “Leighton pushes into the Gobi” was sent on CPS’s June 21 NewsWire. Below is article by another journalist who accompanied Leighton on the same trip)
June 19 (The Australian) Wal King, in Mongolia, says Leighton’s design and construction contract for a freight railway in South Gobi plays to the company’s strengths.
ON a bright and breezy summer's afternoon in the Mongolian capital of Ulaanbaatar, Wal King, is enjoying a favoured pastime: walking.
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For decades there has been talk of a Mongolian resources boom. Yet that is all it has been: just talk. Now talk has finally turned to action. King's local client, the listed Energy Resources LLC, is selling high-quality coking coal to the neighbouring Chinese at $US60 per tonne compared to Australian miners BHP Billiton and Rio Tinto, who are charging more than double the price.
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But Energy Resources has now awarded Leighton Asia the design and construction contract for the Ukhaa Khudag to Gashuun Sukhait freight railway in the South Gobi region, which will transport coal from the southern Mongolian coal fields to China.
The UHG mine is currently producing more than 300,000 tonnes of coal a month, including a record 376,000 tonnes in May. Annual production this year will be 4 million tonnes, and beyond 2012 that number is forecast to grow beyond 15 million tonnes.
It now makes up a third of the division's business, and analysts believe Mongolia has the potential to generate future annual revenues in excess of $US600 million ($710m).
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Last August, the reformist Mongolian government of Prime Minister Sukhbaatariin Batbold (whom King and his chairman David Mortimer met in Ulaanbaatar) finally cleared the way for Rio Tinto and Robert Friedland's Ivanhoe Mines to spend $US5 billion to develop the giant Oyu Tolgoi gold and copper deposit in the south of the country.
(Mogi: The article misstates the PM Batbold as the 1 who was PM last August. It was actually Sanjaa Bayar who was PM at the time)
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Leighton Asia finance boss Tony Jacobs says a posting to the Gobi Desert is arguably the toughest in all of the group's global operations, a fact acknowledged by Jim Barrett, executive director of the Australian Constructors Association, who joined the Leighton board in Mongolia.
"It is hard to imagine a project more difficult to initiate than the UHG mine. The development of the project in some of the harshest possible climatic conditions and in one of the most remote parts of the world was challenge enough," Barrett says.
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MEETING OF ASIA PACIFIC TRADE AGREEMENT TO BE HELD
June 21, Ulaanbaatar, Mongolia, /MONTSAME/ The 36th meeting of the Asia-Pacific Trade Agreement (APTA) will be held June 21-22 in the Ministry of Foreign Affairs of Mongolia.
The APTA was signed in 1975 by developing countries of Asia Pacific region. The key purposes of the Agreement are to develop commerce among developing countries of the Economic and Social Commission for Asia and the Pacific (UNESCAP), to promote their economic development, to liberate the trade and to develop a mutually beneficial cooperation. Members of the APTA are Bangladesh, China, India, Laos, the Republic of Korea and Sri Lanka.
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Following the APTA meeting, a national seminar themed "Commercial policy based on evidence and methods of negotiations" will be held June 23-25 under auspices of the Prime Minister of Mongolia. The seminar is co-organized by the Ministry of Foreign Affairs and the UNESCAP.
Mongolia’s Ambassador Extols Bonds with Cuba
HAVANA, Cuba, Jun 21 (Radio Cadena Agramonte) -- Mongolia’s ambassador to Cuba Yadam Dolgorjav extolled the strong political, collaboration and friendship bonds between the two countries.
In statements to Granma newspaper, the diplomat stressed that Cuba was the first country of the continent to establish diplomatic relations with Mongolia, 50 years ago.
A large number of Mongolians is currently studying in Cuba, said the ambassador, who also highlighted that as a result of collaboration of Cuban experts, Mongolia won a gold medal in boxing in 2008 Beijing Olympics, said the diplomat.
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Australia
Shares retreat as China disappoints
June 22 (AAP) Australian shares gave up much of their yuan-fueled gains as China disappointed investors hoping for a significant rise in that country's currency.
The benchmark S&P/ASX200 index ended the day down 54.3 points, or 1.2 per cent, to 4558.3, while the broader All Ordinaries index was down 51.4 points, or 1.1 per cent, at 4581.3. The drop reversed most of yesterday's 1.3 gain for the ASX200 share index.
Among the major sectors, energy shares lost 1.4 per cent, while materials gave up 1.1 per cent and financials were off 1.1 per cent.
need2know:
The Aussie dollar eased to 87.6 US cents
Asian markets retreat as gains seen overdone
Dow futures were up 3 points to 10,399
Oil futures hovered above $US77 a barrel
Gold futures were flat at $US1239 an ounce
A pledge by China's central bank over the weekend that the country will end its two-year peg to the US dollar was widely interpreted as a sign of confidence about the state of the global economy - sentiment which spurred financial markets higher on Monday.
Mixed movements on China's Foreign Exchange market have tempered that confidence, however, with the yuan today declining the most since December 2008 on speculation the central bank will intervene to limit its gains against the US dollar.
The yuan weakened 0.17 per cent to 6.8095 per US dollar as of 12:40 p.m. in Shanghai today, according to Bloomberg. That move compared with yesterday's rise in the currency to its highest in almost five years.
China
Coal Imports Into China Increased 17% in May, Driven by Rebounding Economy
June 21 (Bloomberg) China, the world’s second-biggest energy user, increased coal imports by 17 percent in May because of a rebound in the economy.
Coal purchases rose to 11 million metric tons in May from a year earlier, according to data released today by the General Administration of Customs. Imports reached a record 16.4 million tons in December, Bloomberg data showed.
China paid an average $109 a ton for delivered coal in May, about 11 percent higher than the previous month, according to the data. The country paid $77 a ton for the fuel a year earlier, reflecting a surge in coal prices as China turned into a net importer last year.
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Indonesian shipments cost $74 a ton on delivered basis while Colombian supplies, which are being diverted to Asia away from traditional markets in Europe, cost $112 a ton, according to the data. Australian coal, which typically includes both thermal and coking coal varieties, cost $164 a ton, supplies from Russia cost $138 and shipments from Vietnam averaged $72.
Coal prices at Newcastle, an Asian benchmark, rose 1.1 percent to $100.39 a ton in the week to June 18, according to the globalCOAL NEWC Index. Prices at South Africa’s Richards Bay averaged $93.29 a ton in the week to June 11 while those at Puerto Bolivar, Colombia, were $79.50 for the fortnight ended June 11.
China’s benchmark coal prices at Qinhuangdao, the country’s largest port for the fuel, were at $111 a ton as of June 21, according to China Coal Transport and Distribution Association.
Indonesia was the biggest supplier to China followed by Australia, Vietnam, Mongolia and Russia, according to customs data. The country also received supplies from Colombia, the U.S. and Canada.
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Indonesian supplies almost doubled to 2.7 million tons in May from a year earlier, customs said. Australian shipments fell 34 percent to 2.41 million tons, followed by Vietnam at 1.73 million tons, Mongolia at 1.2 million tons, Russia at 1.04 million tons and Colombia at 454,232 tons. The country didn’t get supplies from South Africa last month.
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Yuan Gain May Alter Shape of Global Growth More Than Velocity
June 22 (Bloomberg) China’s shift toward a stronger exchange rate may alter the shape of the world economy’s expansion more than its speed, economists said.
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“This currency move is likely to affect the composition of global gross domestic product rather than the growth rate,” said Nariman Behravesh, chief economist at IHS Global Insight in Lexington, Massachusetts, who hasn’t changed his forecasts for an expansion of 3.8 percent this year and 3.6 percent in 2011.
A stronger yuan may make the recovery more durable by reducing its reliance on debt-laden American consumers. That would be welcome news for leaders of the Group of 20, who are meeting in Toronto on June 26-27 to take stock of the outlook for the world economy.
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In the U.S., equities surrendered early gains yesterday on concern a stronger yuan would increase costs at retailers. The Standard & Poor’s 500 Index slipped 0.4 percent to 1,113.20 after rising as much as 1.2 percent in the first hour of trading. All 30 stocks in the S&P 500 Retailing Index retreated, with Macy’s Inc. and J.C. Penney Co. leading with declines of more than 3 percent.
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“It’s a sign that the Chinese policy makers are more confident about their ability to adjust from a low value-added export economy to one that’s got domestic factors at the core,” O’Neill said. “That’s the most important takeaway.
Global
Asian Stocks Fall for First Time in Nine Days on Europe Concern
Asian stocks fell for the first time in nine days on renewed concern Europe’s debt crisis will hurt the global economy after rating companies downgraded France’s biggest bank and said Spanish lenders face difficult years.
Canon Inc., a Japanese camera maker that counts Europe as its biggest market, dropped 2.5 percent in Tokyo. Newcrest Mining Ltd., Australia’s biggest gold producer, declined 1.7 percent in Sydney after the price of the metal retreated yesterday. Mitsui O.S.K. Lines Ltd., the operator of the world’s largest merchant fleet, retreated 2.1 percent in Tokyo after a gauge of freight rates slumped for a 17th consecutive day.
“Europe’s problems still haven’t been solved and people are in no mood to take on risk,” said Hiroshi Morikawa, a strategist in Tokyo at MU Investments Co., which manages about $14 billion. “Investors are worried that developed nations won’t be able to support their economies with any large-scale loosening of monetary and fiscal policies.”
The MSCI Asia Pacific Index fell 0.7 percent to 118.28 at 2:12 p.m. in Tokyo, with more than two stocks declining for each that advanced. The gauge has fallen 8.3 percent from its high this year on April 15 amid concern Chinese measures to curb property prices and Europe’s debt crisis will hurt global growth.
Japan’s Nikkei 225 Index dropped 1.1 percent, the biggest decline among Asia-Pacific indices. South Korea’s Kospi Index lost 0.7 percent and Australia’s S&P/ASX 200 Index fell 1 percent. Hong Kong’s Hang Seng Index was little changed and China’s Shanghai Composite Index gained 0.3 percent.
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European Banks, Growth
Fitch Ratings yesterday cut its credit rating on BNP Paribas SA, France’s largest bank, citing a “deterioration” of the company’s asset quality. Investor sentiment also worsened as European Central Bank governing council member Christian Noyer said some banks are facing funding problems and Standard & Poor’s Ratings Services said Spanish lenders face difficult years as credit losses mount. Economists surveyed by Bloomberg predict Germany’s Ifo institute will say today its business climate index fell in June.
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Gold, Shipping Lines
Shares of gold producers declined today after the metal’s price retreated by the most in a month yesterday in New York, falling from a record. Newcrest slid 1.7 percent to A$35.14. Lihir Gold Ltd., the second-largest gold producer on the Australian stock exchange, lost 1.8 percent to A$4.32. Real Gold Mining Ltd. dropped 1.9 percent to HK$13.50 in Hong Kong.
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Japan Targets Balanced Budget by 2020 to Contain Debt
June 22 (Bloomberg) Japan’s government pledged to balance its books in 10 years, restrict bond sales and overhaul the tax system as part of a plan to contain the world’s largest public debt.
Annual spending will be capped at 71 trillion yen ($781 billion) over the next three years, the government said in its fiscal strategy released in Tokyo today. It will decide changes to the tax regime “soon.” Prime Minister Naoto Kan, who took office this month pledging to restore fiscal health, is exploring an increase in the country’s 5 percent sales tax.
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… Fitch Ratings said yesterday the plan must be “credible” to avoid risking the country’s AA- credit rating.
“The government deserves recognition for setting up concrete targets,” said Susumu Kato, chief economist for Japan at Credit Agricole CIB and CLSA in Tokyo. “But the focus will be on the feasibility of the plan -- how the government will act to achieve the goals.”
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The Cabinet Office today raised its economic growth forecast for the year ending March 31 to 2.6 percent from 1.4 percent predicted in December, as spending by companies and households picks up and exports grow. That would be the biggest expansion in 10 years.
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Misc.
Naadam: Midsummer madness in Mongolia
June 21 (Telegraph.co.uk) –
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"Mogi" Munkhdul Badral
CPS Mongolia
Email: mogi@cpsmongolia.mn
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 mogi@cpsmongolia.mn or +976-9999-6779.
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