Thursday, September 15, 2011

[CPSI NewsAlert: Pres. Elbegdorj Offers to Assist in Envidity's $1B Shivee Ovoo UCG/GTL Project]

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September 14 (Wire Service Canada) Envidity’s Chairman, retired General Wesley Clark has received communications from the Mongolian President's office confirming the national security interests of Mongolia in seeing Envidity’s USD 1 billion Shivee Ovoo Coal Gasification and Gas to Liquids (“UCG/GTL”) project advance and offering to meet personally with General Clark during a planned trip to attend the UN General Assembly in New York next week. General Clark has accepted the President’s invitation.

Envidity is encouraged that Mongolian President Tsakhia Elbegdorj has reached out to us regarding this strategic project” said General Wesley Clark.  “We called upon the Mongolian government to move this project forward and President Ebegdorj answered the call.”  President Ebegdorj is the head of Mongolia’s National Security Council, which has taken significant steps to regularize activities in Mongolia’s minerals sector in the past.  “The President has shown courage and leadership to the international investor community by recognizing the Envidity Project’s national importance to Mongolia, and offering to try to find a way to keep this project in Mongolia.”  

CEO Jeff Brookman also hailed the President’s initiative. “We deeply appreciate President Ebegdorj’s invitation to meet with Envidity’s Chairman, General Clark, as well as the President’s offer to help make this critical project happen”.

Envidity’s Shivee Ovoo UCG/GTL Project is expected to create approximately 3,000 construction and 150 permanent higher salaried jobs, reduce fuel dependency and prices, introduce patented technology, and raise millions of dollars in royalty and tax revenue for Mongolia.  The project has been stalled since Mongolian license holder Live Energy Group LLC/Shine Shivee LLC, backed by Chinese and Malay speculators, refused to finalize a Definitive Agreement to allow seismic and drilling to proceed on the property despite having previously entered into a legally binding agreement to do so. 

Government inaction on a pending UCG Investment Agreement (fiscal stabilization agreement) despite high-level talks between the governments of Canada, the United States and Mongolia, has also effectively blocked the Envidity Project from launch.

The current Envidity UCG/GTL crisis was the subject of intense discussion and concern among potential investors at the recent Discover Mongolia conference in Ulaanbaatar and will, no doubt, significantly impact Mongolia Investment Summits in Hong Kong, London, New York and Toronto.  Current investors are also expressing  concerns that the challenges facing Envidity may signal a trend of Mongolia withdrawing support after it has captured investor commitments and projects are in the process of moving forward. 

Envidity has already secured $120m of cash and access to an additional $850m in debt for a total of $1B in foreign direct investment into its Mongolia UCG/GTL project over five years.  

However, Envidity CEO Jeff Brookman so far continues to hold the door open for the Envidity Mongolia Project.  “With timely action by the Mongolian government, Envidity’s UCG/GTL project can still go forward.”

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