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MMC: VOLUNTARY ANNOUNCEMENT
February 20, Mongolia Mining Corporation (HK:975) --
The board of directors (the "Board") of Mongolian Mining Corporation (the "Company") is pleased to announce that the second module of the Coal Handling and Preparation Plant (the "CHPP") at its Ukhaa Khudag coking coal mine ("UHG mine") has been successfully commissioned by the State Commission comprised of specialists from various government agencies of Mongolia on 16 February 2012, for coal processing operation.
The CHPP capacity expansion work under design, procurement and construction management ("EPCM") contract has been undertaken by Sedgman Limited, Australia, one of the world's leading engineering companies in coal processing and material handling technology. The physical construction process of the second module of the CHPP took approximately 14 months. All inclusive capital expenditures for the second module of the CHPP totaled to approximately USD91 million in line with the Company's original estimations.
The second module of the CHPP has the capacity to process a round 5.0 million tonnes of run-of-mine ("ROM") coal per annum based on the design capacity at around 850 tonnes per hour ROM coal in-feed operating rate for minimum 6,000 operating hours per calendar year. Thus, the second module of the CHPP will enable the Company to double its current coal handling and processing capacity expanding to at least 10.0 million tonnes per annum.
This announcement is a voluntary announcement made by the order of the Board which is not pursuant to the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited. The directors of the Company individually and jointly accept responsibility for the accuracy of this announcement.
MMC Board Meeting 6 March 2012
G. Battsengel: Mongolia is lagging behind its competitors
February 17 (UB Post, from Udriin Sonin) --
The CEO of Energy Resource LLC, G. Battsengel, emphasizes the importance of executing building and development operations as soon as possible; if not, Mongolia will lose a multitude of opportunities. Translated from "Udriin Sonin" newspaper.
What was the message you were trying to get across in your keynote speech at Coal Mongolia 2012?
The message was that we need to improve our infrastructure if we are to be competitors in the coal market.
Mongolia is a new player in this market. But in the past 5 years, coal production has grown rapidly, increasing 10 times. We produced 20 million tons of coal in 2011.
We have been running all coal production related projects, processes and operations based on available infrastructure. Unless we implement new infrastructure policies right now, we will lose invaluable opportunities in the coal market.
In the past 2 – 3 years, many crucial policies have been passed, including the nation's development and railway strategies. I think 2012 is the year to successfully begin implementing these policies. If not, the coal market will not be easy to enter, we will lose our favourable position.
Three years ago, a Russian project name LGO was initiated. The project was to begin building a railway, and they were scrambling to have the project finished. Today, they have already built over 400 kilometers of railroad, and announced that around 10 million tons of coal will be exported through it. If we compare their progress with Mongolia, we are left behind, beaten by our potential competitors.
I wanted to warn the Government, coal importers and exporters that although we have not yet lost all of our opportunities, it is time to pay close attention to the problem.
What actions is your company taking to keep up with the rapidly expanding coal market in Mongolia?
Our market is in Russia and China. To enter the market of any other country, we will inevitably pass through Russia and China. In other words, our strategies completely rely on agreements and policies made between our two neighboring countries.
Our company is working on not only exporting coal to China, but to other countries as well. Last year, a 20,000 ton coal cargo was sent by trucks and later, onto transportation trains; and that shipment has reached a harbor in Japan last week.
We are currently planning to send some shipments to India; and we are constantly monitoring and analyzing the many possible problems that arise through international transportation.
The first coal shipment to Japan has been sold for USD 280 per ton. The transportation cost was USD 170 per ton. The total profit was less than out last year's coal exports to China, which were valued at USD 150 – 160 per ton. USD 280 is a good market price for coal, but our transport costs make it difficult.
Coal is a product with a massive physical size; its profits are heavily dependent on its transportation costs. Whether it is domestic or foreign transport, it is important to reduce transportation costs.
As a landlocked country, our only transportation option is railway transportation. The Government, private companies and public companies – they are all working under the Mongolian banner. We all should pay more attention to our transportation system.
What can you say about the current railway policies and strategies?
The official policies and papers covering railway transports were passed in June 2011. But the implementations of these policies are currently in a stalemate.
The implementation of these projects is not just a matter of construction, massive research work has to be done. These projects have a fairly complicated process. The source of funding and a lot of jurisdiction work must also be cleared.
If all this is solved within 2 – 3 years of implementation, we have a chance of not losing our positions to our competitors. For example, Australia will always try to expand its opportunities and possibilities. I don't think that a country which holds over 50% of the world's coal market will want to miss any opportunities. There are other competitors as well, the US, Canada and Russia.
Have you encountered difficulties in your business as a result of political issues; like elections, changing government officials or changes in policies and laws?
As a citizen of Mongolia, I have seen democracy flourish in the past 20 years in Mongolia. Our country has recently passed the transition stage from the socialist regime to democracy. It has now entered the stage of economic growth.
I believe in the decisions and policies made by the Government of Mongolia because as a democratic country, many people are involved in the decisions and policies. I personally think that those decisions are right. The private sector should support the Government's decisions.
How has Coal Mongolia 2012 affected Energy Resources?
I like the fact that Coal Mongolia 2012 was organized by young Mongolians. As a Mongolian coal company, Energy Resources always trys to support Mongolian youth. We have been involved with Coal Mongolia 2012 since the beginning.
Both the Government and the private sector understand that Mongolia needs to attract the attention of foreign investors.
While I've seen discussion on Mongolia in foreign countries, the Coal Mongolia Conference enabled Mongolians to explain the country's investment opportunities themselves. Energy Resources believe that the Conference is an advantage because it efficiently distributes firsthand information about Mongolia's coal market situation through the words of those directly involved.
What is your opinion on Erdenes Tavan Tolgoi's stock distribution among citizens?
This strategy is based on the positive effects that the mining industry could have on the people. The stocks are in cash, and this is strategy is not only utilized in Mongolia.
For example, the Government of Hong Kong distributed USD 6,000 among its people. The Australian Government also distributes money to its citizens depending on its total income from the mining industry and if I remember correctly somewhere between AUD 500 – 600 was given to Australian citizens in 2010.
Brazil is one of the countries that listed its mining companies on the world stock exchange; Brazil's mining giant Vale, for example.
I think that Mongolia will set an example by taking its company and listing it on international stock exchanges, it's up to the individual person whether he or she wants either the cash or stocks.
COMPLETED FEED STUDY – STAGE II MINE CONSTRUCTION READY TO BE UNDERTAKEN
February 20, Mongolian Resource Corporation Limited (ASX:MUB) --
Highlights:
· Completed Front End Engineering and Design ("FEED")Work for 400tpd CIP Gold Plant
· 24 permits received from government
· Stage II Mine construction ready to be undertake
· MRC to commence Stage I Plant commissioning
Mongolian Resource Corporation Limited (ASX: MUB) ("MRC" or "the Company")' is pleased to announce the completion of the Front End Engineering and Design Work for the 400tpd CIP (Carbon in Pulp) Gold Plant at its Blue Eyes Project located in central north Mongolia, in the Territory of Bornuur Soum of the Tov Province approximately 150km from Ulaanbaatar, and 15km from the main National Trans-Siberian Highway.
The Company appointed Glogex LLC ("Glogex") to complete the FEED Study and full Mongolian Feasibility Study. Glogex has now provided completed FEED designs. The Minister has also granted MRC with the relevant government approvals for mine construction to be undertaken.
The FEED designs include the finals for Mill design and CIP Flow sheet. In design of the mill, three separate metallurgical programs were conducted at Central Mongolian Laboratories, Actlabs and at Boroo Pilot Plant (10t sample). The Stage II plant has been designed with excess capability in the crushing circuit up to 1500 tonnes per day and initial total capacity built around grinding capacity of a 3.8m diameter x 4.5m ball mill.
In the event that the current exploration program outlines a larger resource, the plant has been designed in such a manner that additional ball mills can be added in parallel to increase capacity. The circuit is almost a duplicate of the adjacent Boroo Gold Mine plant which treats 7,500 tonnes per day feed of similar quartz mineralisation.
During the remaining winter months in Mongolia, MRC will focus on completion of a turnkey construction of the Stage II plant. The Company will advise the market on costs of completion of the Stage II plant as they are received.
While the Company is still awaiting approval of Cyanide License which has been delayed by Ministerial changes, it is otherwise ready to commence concentrate production from the already completed 100 tonne per day floatation plant. This is planned for commencement in early April 2012 when temperatures rise to above -10°c and the water sources and frozen ground start to thaw. Stockpiles of ore are ready for treatment through this floatation facility.
…
BOLD RESOURCES ANNOUNCES KEY APPOINTMENTS TO ITS BOARD OF DIRECTORS
February 17 -- Bold Resources Limited ("Bold Resources") is pleased to announce two key appointments to its Board of Directors as it prepares for a potential listing on the Australian Stock Exchange. Enkhbayar ("Eric") Ochirbal has been appointed to the role of Managing Director and Andrew Scrymgeour has been appointed to the role of Non-Executive Director. Bold Resources is an Australian public company that has been incorporated to acquire and develop potential mineral deposits in Mongolia. Bold Resources and its advisor IARUDI LLC ("IARUDI") are currently working with a local Mongolian natural resources company, Mega Mines Mongolia ("MMM"), to complete the acquisition of its Mongolian subsidiary BRX LLC, which owns 100% of four projects in Mongolia located in strategic coal regions, as well as an option to acquire a potential anthracite asset.
About Enkhbayar (Eric) Ochirbal
Eric Ochirbal has extensive experience in the Mongolian resources and securities sectors. Mr. Ochirbal was a cofounder of the Mongolian securities market infrastructure, first as the deputy CEO and then CEO of the Mongolian Stock Exchange. He was the Executive Director and Mongolian Country Manager for Khan Resources Ltd, the Mongolian subsidiary of Toronto-listed Khan Resources Inc, a uranium exploration and development company. He was promoted to the position of Vice President for Government Affairs at Khan Resources Inc. Most recently, Mr. Ochirbal served as CEO of Altain Khuder LLC, one of the largest Mongolian iron ore mining companies. Mr. Ochirbal has also served as foreign policy advisor to the Prime Minister of Mongolia. Mr. Ochirbal obtained a B.S. in Finance and Banking Management with distinction from the Mongolian State University in Ulaanbaatar, and a Masters in Public Administration from Harvard University.
"The Mongolian coal industry is currently going through a substantial growth phase, and I am excited about aligning myself with Bold Resources and its partners. Mongolia's natural resource wealth coupled with IARUDI's service offerings will allow me to make a valuable contribution to Bold Resources", said Eric Ochirbal, Managing Director, Bold Resources.
About Andrew Scrymgeour
Over his thirty year career in the natural resources industry, Andrew Scrymgeour has been involved in all aspects of mining including engineering, operations and management of both surface and underground coal, industrial minerals, and precious metals mines. Mr. Scrymgeour began his career as a mining engineer and continued in that role for nearly twenty years at coal and gold mines in the US. From 1991 through 2009, Mr. Scrymgeour was an international VP at Norwest Corporation, responsible for the management of resources projects in Asia and North America. Mr. Scrymgeour has vast Mongolian coal experience, most recently with Mongolian Minerals Corporation. He has also recently served as a senior consultant specialising in Asian mining projects, including as a mining advisor at Mongolia's Erdenes MGL and as a project manager at Indonesia's PT Adaro Energy Tbk. Mr. Scrymgeour obtained a B.Sc. in Mining Engineering from the University of Witwatersrand, South Africa and an MBA from the State University of Ghent, Belgium. He is a certified South African Mine Manager of Competency, a member of the American Institute of Mining Engineers, and holder of US Patent #4,512,610 for a large scale mining system.
"I look forward to being involved with project development and exploration programs for Bold Resource's assets. I expect that my own technical expertise, coupled with that of Bold Resources' talented team of resource professionals, will contribute to efficient exploration of these assets," said Andrew Scrymgeour, Non-Executive Director, Bold Resources.
About Bold Resources
Bold Resources is an Australian public company that has been incorporated to acquire and develop potential mineral deposits in Mongolia. Bold Resources and its advisor IARUDI are currently working with a local Mongolian natural resources company, Mega Mines Mongolia, to complete the acquisition of its Mongolian subsidiary BRX LLC, which owns 100% of four projects in Mongolia located in strategic coal regions, as well as an option to acquire a potential anthracite asset.
Bold Resources has entered into an acquisition agreement with MMM for these coal assets. Bold Resources intends to then commence project development and initial exploration programs on the assets in late 2012, following a possible initial public offering of Bold Resources on the Australian Stock Exchange.
Bold Resources' established Mongolian presence, strong and diverse Board, and extensive Mongolian and Australian expertise provide the platform to establish the next leading Mongolian coal player.
About IARUDI
IARUDI is a leading Mongolian professional services firm based in Ulaanbaatar. IARUDI offers financial, tax compliance, regulatory, and IPO advisory to international and Mongolian clients. IARUDI also provides in-country logistics to and engages in business partnerships with companies seeking to establish a Mongolian presence. IARUDI was established by experienced professionals from Australia, South Africa and the United Kingdom. IARUDI has been engaged by Bold Resources to assist with strategy and promotion. IARUDI is working actively with Bold Resources to develop a proprietary coal deal pipeline.
For further press information, please contact Eric Ochirbal at enkhbayar@boldres.com or Ean Alexander at ean.alexander@boldres.com or +976 7012 7077.
Centerra Gold workers at Kumtor mine returning to work after agreement reached
TORONTO, February 16 (The Canadian Press) - Centerra Gold Inc. (TSX:CG) said Thursday that workers at its Kumtor mine in central Asia are headed back to work after the company and the local union reached a deal.
The Toronto-based gold miner said the settlement of the more than week-long dispute over payments to a state social fund is expected to cost the company $4 million this year.
Centerra is expected to report its fourth-quarter and year-end results next week.
Analysts on average had predicted a fourth-quarter profit of 35 cents on $245 million in revenue, according to Thomson Reuters.
The company owns the Kumtor mine in the Kyrgyz Republic, the Boroo mine in Mongolia and interests in mines in Nevada, Turkey and Russia.
Centerra produced 585,000 ounces of gold last year at its key Kumtor mine, which accounts for the bulk of the company's global output.
CORRECTED-Mongolia coal rail plans delayed on financing issues
(Repeats with correction of Enkhbaatar comments in final paragraph to state that third phase of the project will be delayed until after 2017, not first and second phases)
Feb 10 (Reuters) - Mongolia's ambitious plan to build a railway network capable of delivering its surging coal output to foreign markets is likely to be delayed as a result of financing difficulties and bureaucratic deadlocks, government officials said on Friday.
Purevbaatar Luvsandavag, vice-chairman of the Mongolia Railway Authority, told Reuters on the sidelines of the Coal Mongolia conference in Ulan Bator that the government had not even raised the $50 million required to fund a series of feasibility studies and project designs drawn up last year.
"We still don't have permission from the government to announce an open tender to build the railways, and in general there is still a deadlock when it comes to funding and building infrastructure," he said.
He said the government had sought funding for the projects through overseas equity markets, instead of the railway authority's preferred option involving public-private partnerships with investors from Japan and South Korea.
J. Bat-Erdene, state secretary at Mongolia's transportation ministry told the conference on Thursday that the government was planning to list 49 percent of state-owned Mongolian Railway Corp on the domestic stock exchange to raise funds for construction.
Mongolia is experiencing a mining boom that is expected to transform its tiny economy in the coming decade, but it has so far struggled to monetise its copious mineral reserves and needs to spend billions of dollars on developing a transportation network capable of reaching consumers.
The government is also wary of the geopolitical and economic risks of being overly dependent on its giant southern neighbour, China, even though it has a guaranteed market for copper and coking coal.
Mongolia exported 22 million tonnes of coal in 2011, with virtually all of it delivered south to China at more than $25 per tonne lower than the international average.
It plans to build an extensive cross-country railway that would eventually connect its huge Tavan Tolgoi coal project in the south Gobi desert to the rail networks of Russia, giving it access to markets in Japan and South Korea, but critics have said the route is not economically feasible.
The government remains reluctant to give permission for Mongolian Mining Corp (MMC) to construct its own 267-km private railway into China, saying a pre-existing route into China would make it more difficult to attract financing for the route east into Russia.
An MMC official told Reuters the company was "still waiting" for the project to be approved.
Construction on the two routes -- east into Russia and south into China -- is expected to begin at the same time, but delays will mean that a third phase of construction going west will not begin until after 2017, said Baasanjav Enkhbaatar of the World Bank's mining infrastructure investment support project.
Parliament ratifies amendments to Tavantolgoi protocol
February 17 (news.mn) In one of its last acts before going into recess on Thursday, Parliament finally ratified much-debated amendments to its 39th protocol, which deals with the Tavantolgoi mining project.
MPs ratified the amendments with 76.1 percent of MPs in attendance voting in favor.
Under the amendments, 20 percent of the shares in Erdenes Tavantolgoi LLC will be distributed to citizens for free, while ten percent will be made available to domestic organizations for purchase.
Each citizen will receive 1,072 shares, though, if a citizen chooses, the shares can be sold back to the Government for MNT 1 million.
Would Chinese company cancel Tavantolgoi contract?
February 17 (news.mn) It has been reported that the Chinese company Chinalco Ltd has sent an official letter to the executive director of Erdenes Tavantolgoi LLC asking to cancel a coal-purchasing agreement.
In July 2011, Chinalco and Erdenes Tavantolgoi signed an agreement for Chinalco to purchase coal from the eastern Tsankhi area of Tavantolgoi. Chinalco made an advance payment of USD 250 million to the Mongolian government. On August 4, 2011, the company began taking delivery of the coal.
The Government used the advance payment to pay for the MNT 21,000 monthly allowance that each citizen receives. Under the terms of the agreement, Chinalco is to pay USD 70 per ton of coal from Tavantolgoi for five years.
But now Chinalco is complaining that the coal is of poor quality and transportation is too risky. In January, company officials sent the official letter requesting cancellation of the agreement.
Our correspondent asked Erdenes Tavantolgoi LLC Executive Director B.Enebish about the letter, but he said he did not know about it. Industry officials say it is possible that coal transporters might be replacing the high-quality coking coal from Tavantolgoi with poorer quality coal, then selling the better coal elsewhere, so the complaints of the Chinese company could be legitimate.
Mongolia has exported 21 million tons of coal to China and depends heavily on the exports for revenue.
Speaker schedules special session
Febraury 18 (news.mn) On Friday, Speaker D.Demberel scheduled special session of Parliament from March 5 to 9.
Special session will commence at 11 am on March 5, in accordance of the Speaker's schedule. It will discuss revising of 2012 state budget, in priority.
The Government has submitted revision of 2012 state budget relating to increase salary of state official and pension from February 1 but Parliament has not discussed final version of the revision yet while MPs should ratify revision at autumn session.
Parliament will also discuss draft laws on local elections that have been submitted by Z.Enkhbold and D.Lundeejantsan that two competing drafts, one that would have local elections held the same day as the parliamentary election, and one that would have local and parliamentary elections held separately.
Besides, MPs will discuss final versions of draft laws on courts, on rules for judges, and on rules for lawyers that have been submitted by President Ts.Elbegdorj.
МЭЗФ хэлэлцүүлэг: "Төсвийн зарцуулалт ба татвар төлөгчдийн хяналт"
February 20 (MEF) Монголын эдийн засгийн форумаас зохион байгуулж байгаа хэлэлцүүлэг өнөөдөр Төсвийн зарцуулалт ба татвар төлөгчдийн хяналт сэдвээр үргэлжилнэ. Хэлэлцүүлэг 16:00 цагт Хууль зүйн үндэсний хүрээлэн дээр зохион байгуулагдана.
Өнөөдрийн хэлэлцүүлэг дээр 3-4 илтгэл тавигдахаар яригдаж байгаа ба Сангийн яамнаас төсвийн илт тод байдлын талаар илтгэл тавина. Мөн МШТУЗТ ТББ, Иргэд төсвөө хянана ТББ-аас тус тус илтгэл тавина.
Таныг хэлэлцүүлэгт идэвхитэй оролцохыг урьж байна.
CPSI will be presenting at this forum
Mineral exploration forum to be held
February 18 (news.mn) Workers in Mongolia's mining industry are holding a forum called "Mongolia Mineral Exploration Roundup 2012" at the Confederation of Trade Unions from March 29 to 31.
At the forum, mining industry employees will discuss the progress of their work, future plans, new ideas, and issue recommendations for solving problems. Delegates will read papers on the issues of geology, tectonic and magmatic issues, mining metals, exploration methods, mining sector economics and management, hydrogeology, ecology, and exploration with private capital.
A "Sample of Mineral Stones" exhibit will be displayed during the forum, as will a photo exhibit called "Nature of Mongolia." Forum organizers will select the best works in each exhibit.
Two training seminars will be held on March 31.
President changes effective date of new law on conflicts of interest
February 18 (news.mn) The President's Office has announced that President Ts.Elbegdorj has decreed that a new law on preventing conflicts of interest among state officials should take effect on May 1, 2012, and not on July 15, 2012, as specified in the law. The President says his decree is in accordance with a Constitutional provision that says all citizens have equal rights before the law.
The President noted that, after the 2012 parliamentary election, there will be a new Parliament and a new Government, and high-ranking officials will be appointed to state agencies. He said the law should be enforced before the election. That, he said, meets the requirements and expectation of society.
Therefore, Ts.Elbegdorj wrote, Chapter 30.1 of Provision 30 of the law on preventing conflicts of interest among state officials is repealed based on relevant laws, the Constitution, and the authority of Parliament and the President.
Five political parties sign memorandum of understanding
February 17 (news.mn) The Mongolian People's Revolutionary Party (MPRP), Mongolian National Democratic Party (MNDP), Republican Party (RP), Mongolian Liberal Party (MLP), and Mongolian Democratic Development Party (MDDP) signed a memorandum of understanding on Friday.
MPRP Chairman N.Enkhbayar, MNDP Chairman M.Enkhsaikhan, RP Chairman B.Jargalsaikhan, MLP Chairman L.Altanchimeg, and MDDP Chairman T.Oyunaa signed the memorandum in a ceremony that was attended by 50 guests.
The memorandum states that the five parties, without the MPP and DP, will focus on fairness to develop the country and build large factories that will provide a good living to all citizens who demand fairness.
The party leaders stated their preference to work together without the MPP and DP in order to save the state from oligarchies.
Market price of Inner Mongolia coking coal on Feb 20,12
February 20 (SteelHome.cn) --
Unit : (Yuan/ton)
Product | Spec | Origin | Price | Up/Down |
coking coal | A<10.5%，V：27%，S<1%,G>80% | Wuhai | 1310 | -- |
Rich coal | A<10.5%,V:28-32%,S<1.8%,G>90% | Wuhai | 1210 | -- |
Rich coal | A<10.5%,V:28-32%,S<2.5%,G>90 | Wuhai | 1030 | -- |
1/3 coking coal | A<10.5%,V:28-30%,S<1.0%,G:80-85% | Wuhai | 1280 | -- |
Market price of Inner Mongolia iron ore on Feb 20,12
February 20 (SteelHome.cn) --
Unit : (Yuan/ton)
Product | Spec | Origin | Price | Up/Down |
iron ore concentrates | Magnetite,Fe:66%,S<0.1%,SiO2<7% | Baotou | 950 | -- |
iron ore concentrates | Magnetite,Fe:64%,S<0.1%,SiO2<7% | Baotou | 830 | -- |
iron ore concentrates | Magnetite,Fe:62%,S<0.1%,SiO2<7% | Bayannur | 750 | -- |
Inner Mongolia Coal Exchange Center to Start Trading by February End
February 17 (SteelHome.cn) The Inner Mongolia Coal Exchange Center is set to start trading operations at the end of February this year, in a move to enable coal producers to have absolute control over settling prices of the fuel in the region.
Industry sources have said that the opening might fall on February 27.
For a long period of time, coal producers in Inner Mongolia calculate coal prices based on prices at Qinhuangdao Port and their production costs.
The establishment of coal trading center will surely bring in substantial changes to these coal producers' embarrassing situation.
Coal trading volume is expected to hit over 200 million tonnes by the end of 2012, totaling an estimated 120 billion yuan in value, according to senior executives of the center. Meanwhile, the center is expected to generate tax revenues of 20 billion yuan during the period.
About 20% growth in the trading volume is estimated in coming years.
China halts hundreds of mining projects in Inner Mongolia
HOHHOT, Feb. 18 (Xinhua) -- The regional land and resources bureau checked about 9,000 mining projects in the months-long overhaul, halting 467 illegal projects, ordering 887 mines to suspend operations and permanently shutting down 73 mines.
Officials of the bureau said the mines either were unlicensed, harassed the life of local residents, or failed to properly compensate for the use of grassland.
In a bid to build "harmonious mines" the government defused 100 disputes between local herders and mining companies last year while establishing an effective mechanism among the government, mines, and local residents to settle mining disputes through dialogue, they added.
Inner Mongolia ordered an overhaul of the mining sector, originally scheduled for one month but was extended, after protests against grassland mining broke out last May in the wake of the death of a Mongolian herder during a dispute between miners and herders.
The regional coal mine industry bureau promptly ordered local work safety watchdogs to strengthen supervision of coal mines to ensure safe production practices, protection of the environment, and attention to the welfare of local residents.
Inner Mongolia holds the country's largest coal reserves -- 770.3 billion tonnes by the end of 2011 -- and rich deposit of other mines such as iron ore and rare earth metals.
A mining boom in recent years has brought prosperity to the region but concerns have been raised on the ecological damage that mining might cause to a region better known for its stretching, wavy grassland and a unique herding culture.
Inner Mongolia to Curb Coal Production Below 1 Bln Tonnes by 2015
February 16 (SteelHome.cn) Inner Mongolia, China's top coal producer, will be straining to curb production of the fuel to below 1 billion tonnes by the end of 2015, the country's National Development and Reform Commission (NDRC) said Tuesday on its website.
By the end of 2013, all coal mines with annual production capacity of less than 1.2 million tonnes are projected to be washed out, according to the NDRC.
Moreover, the number of coal mining enterprises will be reduced to in the range of 80-100, forming 1-2 mining giants with annual production capacity of above 1,00 million tonnes. There would be 5-6 coal miners capable of generating at least 50 million tonnes of coal annually and another 15-16 companies producing 10 million tonnes annually.
During the 11th Five-year Plan period, Inner Mongolia has made brilliant achievements in coal industry restructuring, with the number of total coal mines cut to 551 from 1378. Raw coal production increased dramatically to 787 million tonnes from 260 million tonnes in 2005.
In 2011, Inner Mongolia produced 979 million tonnes of raw coal, up 25.1 percent from a year earlier.
Ts.Dashdorj says progress is too slow on airline projects
February (UB Post) The new Minister of Road, Transportation, Construction and Urban Development, Ts.Dashdorj visited the Civil Aviation General Authority (CAGA) and the Railway Management Office (RMO) on February 14th.
This year, about 14700 flights were boarded and landed, serving 890761 passengers, and 772 tons of freight was moved through Chinggis Khaan international airport.
Last year, about MNT 200 billion was spent on the development of airports in rural areas. Also airports in Khuvsgul, Umnugovi, Khovd and Dornod were upgraded to international status. An airport building is being built in Khushigiin Khundii due to the increase in passengers and flights to domestic areas.
Ts.Dashdorj and the officials observed security monitoring, the regulations office, airplane repair, and other services at the airport. The Activity of the Civil Aviation.
Dashdorj commented "we have to modify the security monitoring system. Also the Khushigiin Khundii Airport building activity isn't progressing on time, so I'm giving an order to intensify building work and we'll cooperate to start up a tarmac sealed airport road in April."
He also said that there needed to be an increase in occupational safety procedures among Civil Aviation officials. Khushigiin Khundii airport will begin activity in 2017.
Officials announced that the freight fvolume on the Ulaanbaatar Railway will be 16.8 million tonnes in 2012 which is 18.6 percent higher than the freight volume in 2011. Passenger turnover will also increase on previous years.
The volume of exported mineral resources are also set to rise. Ts.Dashdorj said that the Government will make an investment in the railroads this year.
Reserve meat will be increased by 10,000 tons, 6% Mortgages to be issued
February (UB Post) Members of the State Great Khural decided Wednesday to add an additional 10,000 tons of meat to the 9,000 tons already reserved in Ulaanbaatar.
Around 16,000 tons of meat was originally reserved for Ulaanbaatar, but unforeseen demand will deplete this before summer.
The additional meat will come from rural areas outside of the city.
It is possible to reduce the price of fuel by at least 100 MNT
The Minister of Finance and the Head of the Council for Organizing and Monitoring the Price and Fee Stabilities of Food, Transportation and Fuel, D. Khayan-Khyarvaa, has been told to work jointly with the Minister of Mineral Resources and Energy D. Zorigt to decrease fuel prices by 100 MNT per liter.
State Great Khural members have been critical about the work being done by the Council and their inability to combat the fuel price increase.
Although the US Dollar exchange rate has been decreasing fuel exporters are refusing to reduce their prices.
State Great Khural members believe it is possible – considering the fuel importers' own fees and expenses – to reduce the price of fuel by at least 100 MNT per liter.
Apartment contracts with 6% interest rate to be issued soon
Members of the Great State Khural have requested that The Minister of Road, Transportation, Construction and Urban Development, Ts. Dashdorj, opening bidding on the Government's '100 Thousand Homes' project as soon as possible.
The project will build 75,000 apartments in Ulaanbaatar and 25,000 apartments in rural areas. Loans with 6% interest rates will be given to households that have never purchased an apartment before.
The Prime Minister S. Batbold urged that the project progress and develope faster.
Coal Mongolia 2012 Recap
February 16 (BCM) Infrastructure was the word on everyone's tongue at the Coal Mongolia 2012 event last week in Ulaanbaatar. This year saw 1,703 participants from 250 companies from 25 countries at the annual event held to promote investment into Mongolia's coal sector, and encourage discussion and cooperation within the sector community.
Highlights from government speakers include talks by Ch. Khashchuluun, chairman of the National Development and Innovation Committee, discussing key indicators for the macro economy; and B. Enkhbaatar, the World Bank's director of mining infrastructure investment, who discussed the key challenges facing the development of Mongolia's rail system, which included integrating regional infrastructure policy (the hitch is energy and rail policies are separate), negotiating infrastructural development with the private sector, expanding border capacity, and strengthening the currently vague legal environment with mechanisms for the enforcement of policies.
Enkhbaatar explained that a limitation of the rails that would not allow for heavy loads of coal is another challenge for the outdated Soviet-era rail system. China's cooled interest in developing the Erlian border port, which resides on Chinese soil, has caused further delays.
From business the most anticipated speakers were from General Electric Co. (GE), Trade and Development Bank of Mongolia (TDB), and, Erdenes-Tavan Tolgoi (E-TT). TDB president Randolf Koppa had the biggest surprise, having announced the 4.8 percent acquisition of his company by Goldman Sachs Group Inc.
For B. Enebish, the head of E-TT, and Ts. Tumentsogt, GE's chief representative, the conversation turned back to infrastructure. In addition to GE's partnership with Newcom Group to develop the Salkhit wind farm, it also would like to be involved in the development of Mongolia's rail infrastructure. Enebish said the lack of infrastructure would likely affect the float of shares. The limited capacity at the port also has the company settling with transporting only about half of the one million tons of coal extracted thus far. For 2012 the company plans to extract up to 4 million tons'
Mongolia's Mining Boom: Oyu Tolgoi and Tavan Tolgoi
February 16 (Energy Digital) As the world's fastest growing economy, Mongolia has the most promising untapped deposits of iron, gold, silver and coal in the world--but will it serve as a curse or a blessing?
Where traditional nomadic life once comprised the landscape of the Gobi desert for thousands of years, bus stops and 20-story tall ore extraction shafts now stand among an ancient culture as Mongolia experiences the first phases of rapid industrialization. Due to recent discoveries, a country where over a third of the people live in poverty will soon become a global economic giant, home to hundreds of billions of dollars worth of untapped minerals and precious metals. Deemed the Saudi Arabia of Central Asia, Mongolia is one of the richest countries in the world in terms of natural resources.
MINING MANIA
When Canadian mining giant Ivanhoe Mines made its first discovery in Mongolia's Gobi desert in 2001, the result was one of the largest finds in mining history with deposits of iron, gold and silver greater than the size of Manhattan. In Oyu Tolgoi, over 81 billion pounds of coper and 46 million ounces of gold are expected to ensure production for well over 50 years.
The $10 billion Oyu Tolgoi copper-gold deposit is 66 percent owned by Ivanhoe and Rio Tinto with the remaining falling to the Mongolian government. Tavan Tolgoi on the other hand, an open coal pit expected to contain 7.5 billion tons of coal, is still being eyed by foreign investors, but China alone is expected to get an upwards of 39 percent of its coal from Mongolia this year. Coupled with global rises in the price of gold, Mongolia's operations will contribute to a stabilization of the market.
In an attempt to pull its people out of poverty by exploiting its vast amounts of untapped wealth, the newly Democratic state pursues the privatization of assets to ensure that a tenth of all proceeds go directly to its citizens. Subsequently, the country's GDP is expected to quadruple, boosting the average Mongolian's earnings by 60 percent in 2013. The government has promised to pour large sums of money into the country's infrastructure, healthcare system and education, including $85 million towards education and training for the new jobs expected to come from mining in upcoming years.
CURSE OR BLESSING?
As locals are thrust into the 21st century, many worry that mining operations will drain water supplies and threaten the nomadic life and culture most have depended on for centuries. The stress put on animal herds and available land outside the massive mining operations and infrastructure has made it impossible for grazing to take place within 20 to 30 kilometers of the sites due to growing traffic and dust.
"Both Oyu Tolgoi and Tavan Tolgoi ... will require huge amounts of water, and from the environmental impact assessment, and from their plans and their feasibility studies, we know they have not demonstrated availability of water for the life of this project," Dugersuren Sukhgerel, executive director of an NGO called Oyu Tolgoi Watch told Reuters. "Mongolia is experiencing a higher degree of climate change – over 70 percent of Mongolia's territory is suffering desertification. That is a big concern."
Others worry the government moved too quickly to cede control of mining activities to foreigners, which has led to a number of heated parliamentary meetings, editorials and protests within Mongolia. Monitoring signs of corruption will also be crucial. In 2009, Transparency International rated Mongolia 120 in corruption percent, falling from 102 the previous year.
Education will play a vital role in getting the people on board with the goals of the government and the true long term benefits of mining efforts in the region, according to PM Sukhbaataryn Batbold. Under advisements of international organizations like the IMF and World Bank and learning from the success stories of other resource-rich areas like Chile, Canada, Norway and Alaska, Mongolia is off to a good start.
With the chance to claim the title as the world's fastest growing economy, Mongolia has been coined as the new Asian Tiger, with a "wolf economy" that is ready to pounce the capital market. In an interview with CNN, Prime Minister Batbold said "like the spirit of Mongolia, a wolf is strong and able to survive harsh environments." As the government faces these challenges ahead, "we think we can overcome them by being strong like a wolf."
Time looks right for Mongolia to emerge
February 20 (The National, UAE) Irish bars springing up in Ulan Bator are as sure a sign as any that the outside world is taking an interest in Mongolia.
Those investors who can stomach a large measure of risk have found plenty of returns to be had in Mongolia during the past few years. The IMF estimated economic growth at 11.5 per cent last year and predicts 11.8 per cent for this year amid a boom in production of rare earth metals and a bonanza of investment.
Mongolia's stock market was the second best-performing of last year, with its 46.9 per cent rise beaten only by a near-doubling of Venezuela's index.
But investors should take the local stock market performance with a grain of salt, given its small capitalisation and poor liquidity, said Mark McFarland, an emerging-markets economist at Emirates NBD. Despite being one of the riskier bets in a balanced portfolio, the country has its merits.
"The phenomenal returns are behind us, and you'll have more reasonable returns over the next five to 10 years," Mr McFarland said. "Our view is that if you can take a longer-term view on Mongolia, you can do very well."
While investing at the start of the country's growth could bring big returns, risks including uncertain completion dates for infrastructure projects and a decelerating pace of growth in neighbouring China were worth bearing in mind.
There are few ways to gain direct exposure to Mongolia, but retail investors looking for liquid stocks may wish to take a look at Ivanhoe Mines, a Canadian mineral company listed on the Toronto Stock Exchange and involved in copper and gold projects. Also of note is Mongolian Mining, a producer of coking coal listed on the Hong Kong Stock Exchange.
Political clamour to nationalise the country's mining industry and efforts to stem inflation could still spoil the party, said Fatema Akashah, an economist at Kuwait China Investment.
"The nature of the mining industry … allows a certain level of stability, as investments in mines take several years of development and orders for resources tend to be large," she wrote in a research note. "Mongolia is a land of opportunity, but investors must be aware of the possible landmines along the way."
Mongolia expanding investment, ties with Kuwait -- Kuwait China Investment Company
BEIJING, Feb 19 (KUNA) -- Mongolia is receiving massive foreign investment inflows and is developing bilateral ties with countries like Kuwait and other GCC members to foster economic links in a time when the developed economies are treading water, the government-affiliated Kuwait China Investment Company (KCIC) said Sunday.
Mining has opened the doors for investments in many of the economy's sectors that are still quite underdeveloped, KCIC said in its weekly analysis.
Mongolia's economic potential is enormous and the International Monetary Fund (IMF) forecasts an average growth of 14 percent for the next five years. When most of the world's economies are facing slowing growth, and Europe a likely recession, Mongolia emerges as one of the few countries that will grow at a staggering pace, it said.
"In 2011, we expect its economy to have grown 11.6 percent year over year, higher than 2010's 6.4 percent and its highest annual rate in 21 years." The wealth of coal, copper, gold, silver, and other minerals are source of 80 percent of Mongolia's yearly exports, and expected to grow to 95 percent. Soon, Mongolia will be one of the top five producers of copper in the world. "Over the next few years, the country will need to rapidly develop its infrastructure, financial sector, real estate, and other industries to meet the growing needs of a nation on the path to becoming one of the richest in the world (in per capita terms)," it said.
This bright future, however, is not without serious potential risks that stem from an overly rapid growth driven by resource-exploitation, the firm said.
"Mongolia's democratic government will undergo elections in 2012 and populist movements have been pledging the nationalization of mining projects that had been promised to be open to foreign investment," it said. "There is a lot of doubt as to whether the government will be committed to spending wisely, " it said, adding that the Asian nation still faces the major task of steering its rapid growth and avoiding asset bubbles and high inflation.
The dependence on Chinese demand is also risky, it pointed out. "China has a growing domestic economy, but it is still susceptible to rapid declines in foreign demand, especially from the West, and the adverse effects would directly transfer to Mongolia." The nature of the mining industry, however, allows a certain level of stability, as investments in mines take several years of development and orders for resources tend to be large. Mongolia is a land of opportunity, but investors must be aware of the possible land mines along the way.
KCIC was founded in 2005 with a capital of KD 80 million by an Amiri Decree with a mandate to develop investment opportunities in Asia towards building an Asia focused asset management company. The public company employs a team of specialists in markets in Asia and currently manages assets in excess of USD 600 million.
Key shareholders include Kuwait Investment Authority, the Sovereign Wealth Fund of Kuwait, National Investment Company, one of the leading investment banks in the Middle East, and Al Ghanim Industries, one of the largest conglomerates in the Middle East.
Move One Handles Challenging Consignments In Mongolia
February 15 (LogisticsWeek) Move One has successfully handled another time- and temperature-sensitive consignment of fresh food for the massive Oyu Tolgoi mining project in Mongolia.
The shipment was delivered from Miami and Australia directly to the major catering contractor in Ulaanbaatar using temperature controlled containers and storage facilities. Transporting cargo over such distances within a short time frame requires a high degree of expertise and planning, further challenged by Mongolia's weak transport infrastructure and difficult weather conditions.
"Move One has yet again shown that it has the skills and the systems necessary to handle such shipments, whether it is refrigerated airfreight to Mongolia or sensitive cargo to anywhere in the world," says Sean Kosa, Move One's country manager for Mongolia.
In addition to providing supply chain solutions to the catering contractor, Move One is pleased to play a key role in the development of the natural resource-based economy in Mongolia by supporting other Oyu Tolgoi suppliers and subcontractors. Common shipments received at the Ulaan Baatar warehouse 660 km north of the mine include spare parts, equipment, and out-of-gauge material.
After years of providing freight forwarding services in Mongolia, Move One last year opened a dedicated office in the capital of Ulaanbaatar to centralize its services in the country. With the new office, Move One is actively involved in the country's industrial development, using all resources at its disposal to assist with freight forwarding and logistics services.
Misc
TV Station in Mongolia Facing Criminal Defamation Charges
VIENNA, Feb 17, 2012 (IPI) – A television station in Mongolia has been charged with criminal defamation after the station aired a documentary alleging corruption among high-ranking public officials.
According to the Mongolian press freedom organisation Globe International, channel TV9, in a documentary titled "Detective-2", presented apparent evidence of corruption concerning a police investigation into the privatisation of a former government-owned building. The property in question housed the state printing press as well as the offices of the Ulaanbataar Times, a formerly state-run daily newspaper.
The paper was privatised in 2008 by the Capital City Privatisation Commission, a government body tasked with privatising state-owned industries in Ulaanbaatar, according to an earlier report by Globe International. The Ulaanbaatar Times had by that time accumulated millions of Mongolian tögrög (MNT) in debt. [1 EUR = 1,800 MNT.] The building in question had also apparently suffered significant structural damage, the organisation said.
At the time of the privatisation, Chuluunbaatar Dolgor, who would shortly become the paper's editor-in-chief, served as head of the privatisation management team. In March 2011 authorities arrested Chuluunbaatar and charged with him "illegal privatisation and serious damage of public property." As previously reported by the International Press Institute (IPI), he was later released on bail in July after a campaign led by Globe International and supported by the Asia Journalists' Association, Reporters without Borders, and IFEX.
On 22 Dec. 2011, P. Otgonjargal, the police commissioner who had been investigating the privatisation of the Ulaanbaatar Times, filed a criminal-defamation claim against TV9 in response to the documentary's allegations.
H. Naranjargal, president of Globe International, told IPI he believes the current charges are politically motivated. Mongolian media reported earlier that the privatisation of the Ulaanbaatar Times had been led by the country's then-president Enkhbayar Nambar, who lost a campaign for re-election in 2009 but remains involved with the opposition. Naranjargal said that TV9 is aligned with Nambar and that the former leader has invested in the station, but added: "Journalists must not be victims of the political game."
According to Globe International, police have been pressuring TV9's creative team to reveal their sources for the corruption allegations and have threatened the team's members with detention.
O. Baasankhuu, a defence lawyer working on the case, has denounced the police's interrogation techniques as a violation of Mongolian law. He added that the case "shows how the role of the press for the public interest is undermined" and said the ability of the press "to provide accurate and reliable information may be adversely affected."
Naranjargal told IPI that the information TV9 used for the documentary came from publicly available sources and was simply an analysis of what other newspapers and websites had already published.
IPI Press Freedom Manager Anthony said: "Regardless of the political implications, journalists have a right to report on matters of public interest. No journalist or media outlet should be subject to criminal defamation charges for investigating allegations about the police or any other government officials. We urge Mongolian authorities to end their interrogation of TV9 employees and to drop all charges against the station."
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"Mogi" Munkhdul Badral
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CPS International LLC
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CPS International is a marketing arm of CPS Securities in Mongolia. CPS Securities is a Perth, Western Australia based AFSLicense Holder. To trade ASX and international stocks, feel free to contact me at mogi@cpsinternational.mn or +976-99996779.
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