CPSI NewsWire brings you market updates on Mongolia, compiled by CPS International, a Mongolian marketing arm of CPS Securities, a Perth, Western Australia based stockbroking and corporate advisory firm, specialising in capital raising for mining and junior stocks.
Mongolian Mining Increasing 2013-14 Coking Coal Output, But Shelves Thermal Coal Production Till 2015
Aug 08, 2012 (Dow Jones Newswires) -- --Mongolian Mining holds off from thermal coal production until 2015
--Mongolian Mining sees higher coking coal output despite market woes
--Mongolian Mining has sufficient funding for railway project
HONG KONG--Mongolian Mining Corp. (0975.HK), Mongolia's top coal producer by volume, has cut its 2013-14 overall output target by over 13% due coking and thermal coal price differentials, logistical issues and weaker demand, Chief Executive Battsengel Gotov told Dow Jones Newswires.
The reduction comes at a time of slowing global economic activity, reduced coal demand in many countries and an expected fall in China's second-half 2012 steel output. The steel industry is a major user of coking coal, which is more expensive than thermal coal used for power generation.
"Coal demand is slowing, but supply remains strong particularly from North America and Australia. I think this pressure will continue in the second half," Mr. Gotov said.
The Ulan Bator-based company has decided to shelve plans to start producing thermal coal, and now won't do so until an export railway to China comes into service in 2015, although it will boost coking coal output next year.
It is targeting a 2013-14 coking coal output of 12 million-13 million metric tons, up from 10 million tons planned earlier, but now won't be producing an anticipated 5 million tons of thermal coal, he said.
"We revised the production plan as the profit margin of coking coal is higher than that of thermal coal. We are trying to maximize the benefit to the company," Mr. Gotov said. "Once the railway is in place, the transportation costs will be lower and the economic benefit of selling thermal coal will become appealing."
China's coking coal prices fell 5%-10% in the first half due to lower demand from steel mills in response to slowing orders from the construction, ship-building and machinery manufacturing sectors.
Mongolia is a preferred choice for Chinese coking coal importers given its lower transportation costs and quality levels comparable with Australian coal.
Mongolia, which overtook Australia to become China's largest coking coal supplier in 2011, exported 10.3 million tons in the first half of this year, a rise of 34%, with the bulk of this extra supply going to China.
To reduce transportation costs, Mongolian Mining is building a 240-kilometer railway from its Ukhaa Khudag mine to the China-Mongolia border at Gashuun Sukhait, at a cost of some $700 million, which will be fully operational in 2015, Mr. Gotov said.
The company, which raised $650 million in Hong Kong in 2010, has sufficient capital to pay for the railway, as it had issued US$600 million notes in March this year, he said.
The Hong Kong-listed company, which reported a 56% rise in first-half net profit to US$31 million, currently sends all its China-bound coking coal by truck.
Meritus: Mongolian Mineral Resources Council Accepts Gutain Davaa Gold Resource for Registration
Vancouver, B.C., August 9 (TheNewswire.ca) Meritus Minerals Ltd. (MML) (TSX-V- MER) Meritus is pleased to advise that the high grade gold resource at the Toordogiin Shil Prospect on the Gutain Davaa Project has been accepted for registration by the Mongolian Mineral Resources Council after review and approval by a number of experts. Under the Mongolian system, which is required to be used for registration, the resource is classified as a B+C Resource of 3.17415 tonnes of gold at an average grade of 5.73gAu/t.
NOTE: Due to methodology used this resource is not compliant with NI 43-101 or JORC Code reporting standards.
The resource can be expressed in conventionally used language as approximately 550,000 tonnes grading 5.73gAu/t for 102,000 ounces of contained gold. The resource has been assessed on the basis that it only includes mineralization that could be available for underground mining.
Meritus is also pleased to advise that its new partners are making good progress with advancing the project
An Environmental Impact Assessment has been completed. This has been presented to the Ministry of Nature Environment Tourism and the local Soum (district) administration for their evaluation. Other activity of significance that benefits the project has been the extensive repairs carried out to the only bridge in this district across the Onon River to allow better access to the site. Our partners are also making considerable effort in explaining the project and its potential benefits to the local community and are reviewing with the local authorities methods by which the local community will benefit and can be involved in the project.
Preliminary discussions with the Mineral Resource Authority of Mongolia are underway with the objective of entering into a pre-mining agreement
Prophecy Coal halts Ulaan Ovoo operations due to oversupply
August 9 (Proactive Investors) Prophecy Coal Corp. (CVE:PCY) temporarily halted coal mining operations in Mongolia at its Ulaan Ovoo mine, in a move that will see 80 workers laid off.
The Vancouver-based company, which announced the news on Thursday, said its coal stockpile which is at 187,000 tonnes is sufficient to meet contractual supply obligations for fiscal 2012.
About 80 mining staff has been laid off, while Prophecy has paid out a total of $100,000 in severance costs.
Prophecy said 15 workers will remain on-site for equipment, maintenance, shipping and security during the shutdown.
The company expects the local labour force to remain available for "prompt rehire" when needed, due to little local employment competition.
The shutdown is expected to last six months but could cease sooner, if Prophecy snags new coal sale contracts.
Prophecy Coal said it is using the downtime to work with Mongolian officials to seek road and bridge improvements, and to open the Zeltura border to facilitate Russia export sales.
The overall effect of the suspended operations will be modestly cash flow positive as Ulaan Ovoo operations had not yet achieved break-even levels.
Prophecy Coal is engaged in developing energy projects in Mongolia.
The company’s proposed 600 megawatt power plant next to the Chandgana coal deposit has been permitted by the Mongolian government.
The project will be implemented in two phases. Phase 1 will see two 150 megawatt and transmission lines built next year and completed by 2016. Phase 2 construction will see two 150 megawatts being built in 2014 and finished by 2017.
Since obtaining the license, the company has been in on-going talks with the Mongolian government to finalize power purchase agreements to secure the country’s long-term energy supply.
Denison Mines Corp. Reports Second Quarter 2012 Results
("Denison" or the "Company") (TSX:DML)(NYSE MKT:DNN)(NYSE Amex: DNN) today reported its financial results for the six months ended June 30, 2012. All amounts in this release are in U.S. dollars unless otherwise indicated.
Denison is engaged in uranium exploration, as both operator and non-operator of joint ventures and as operator of its own properties in Canada, Mongolia and Zambia. For the three months ended June 30, 2012 exploration expenditures totaled $4,396,000 as compared to $2,442,000 for the three months ended June 30, 2011. For the six months ended June 30, 2012 exploration expenditures totaled $7,416,000 compared to $5,591,000 for the same period in 2011.
Exploration expenditures of $2,516,000 for the three months ended June 30, 2012 ($664,000 for the three months ended June 30, 2011) and $2,822,000 for the six months ended June 30, 2012 ($969,000 for the six months ended June 30, 2011) were incurred in Mongolia on the Company's joint venture properties. A 29,600 metre drill program has been completed on the Urt Tsav and Ulziit properties. The drilling on Ulziit successfully expanded the 2011 discovery.
The Company currently has an 85% interest in the Gurvan Saihan Joint Venture ("GSJV") in Mongolia. The other party to the joint venture is the Mongolian government with a 15% interest. Under the Nuclear Energy Law of Mongolia, the Mongolian participant in the GSJV is entitled to hold a 34% to 51% interest in the GSJV, depending on the amount of historic exploration that was funded by the Government of Mongolia, to be acquired at no cost to the Mongolian participant. This interest would be held by Mon-Atom LLC, the Mongolian state-owned uranium company.
Denison's plans for Canada, Zambia and Mongolia are not anticipated to change for 2012 as a result of the Transaction. Total expenditures on development and exploration projects in 2012, excluding the U.S., are estimated at $22.3 million.
In Mongolia, a $4.3 million exploration program is projected. The 29,600 metre drilling program on the Urt Tsav and Ulziit properties is complete. Discussions to finalize the GSJV restructuring will restart in September with the government and regulatory authorities following the June election.
Mongolian parliament appoints Altanhuyag as new PM
ULAN BATOR, Aug. 9 (Xinhua) -- The State Great Hural of Mongolia (parliament) on Thursday elected Norov Altanhuyag as the country's new prime minister.
During the plenary session of the parliament held Thursday night, Altanhuyag, chairman of the Democratic Party of Mongolia, won 72.4 percent of the vote to gain the premiership.
Altanhuyag previously served as the first deputy prime minister in the coalition government formed by the Mongolian People's Party and Democratic Party from 2008 to 2012.
The Democratic Party secured 31 seats in the 76-member parliament in the June 28 parliamentary election, making it the body's largest party.
Failing to gain an absolute majority in parliament, the party decided to form a coalition government with Civil Will-Green Party as well as with the Justice Coalition formed by Mongolian People's Revolutionary Party and Mongolian National Democratic Party.
MONGOLIAN WOMEN’S CAUCUS CONDUCTS FIRST-EVER LEGISLATIVE MEETING
– Women members of Mongolia’s Parliament wasted little time in getting to work after their election on June 28, 2012. Tripling their numbers in this election from three to nine, the new members capitalized on this momentum to create an informal parliamentary caucus with the encouragement of the at the International Women’s Leadership Forum held in July 2012.
Putting partisanship aside, the women quickly organized, elected their own leadership and agreed upon an agenda. This was completed all before the Mongolian Secretary General of the Parliament was elected and committee chairs were assigned. The women then focused on their first priority: improving the quality of maternity hospitals.
At their first legislative meeting, held on August 6, 2012, the Mongolian Parliamentary Women’s Caucus brought much needed national attention to the quality of maternity hospitals. In addition to members of the caucus, officials from Mongolia’s Ministry of Health, hospital administrators and representatives from more than 16 local Mongolian health related civil society organizations addressed this unspoken crisis.
The caucus also heard from obstetricians and health care professionals via a video of taped interviews that explained key issues facing maternity hospitals today. This includes an insufficient number of maternity beds and a dwindling number of maternity health care professionals. Low salaries, burdensome government regulation and a lack of training capacity contribute to the problems that maternity hospitals face.
“Thanks to IRI support, we are now able to focus on this pressing issue,” said Erdenechimeg Luvsan, chair of the caucus. “There is a shortage of more than 600 maternity specialists in the country and with the information and recommendations gathered in this workshop we will bolster our arguments for increased funding in the national budget.”
Munkh-Erdene’s boxing win makes London 2012 Mongolia’s most successful Olympics ever
August 8 (Inside The Games) It was one of those priceless Olympic moments.
At around 10 o'clock, a small corner of East London was transformed suddenly into an outpost of Ulan Bator, as scores of Mongolians celebrated a new Olympic landmark for the landlocked Asian country.
The victory of boxer Munkh-Erdene Uranchimeg (pictured above, left, and below, left) in his light welterweight quarter-final bout against host nation favourite Thomas Stalker (pictured below, right) means that Mongolia is now assured of winning more medals at London 2012 than in any previous Olympics.
With a silver and two bronze medals already in the bank, Uranchimeg's win means that two Mongolian boxers – flyweight Tugstsogt Nyambayar being the other – have qualified for the semi-final stage of their respective competitions.
This assures them of at least a bronze medal.
This, in turn, guarantees Mongolia a haul of at least five medals – a new record.
The country has mustered four medals on three previous occasions, most recently in Beijing four years ago, when it won its first two golds.
It seems particularly appropriate that this record should have been attained at London 2012, as the metal ore for some of the medals was mined in Mongolia.
In effect, the five medals will be going home.
Uranchimeg's victory was all the more noteworthy as it was achieved in a highly-charged atmosphere, with the vast majority of spectators noisily urging on the home favourite Stalker.
The din ratcheted up still further for the start of the third and final round, which the Mongolian began with a 14-13 lead.
Stalker responded with a relentless, if sometimes guileless, assault, but at the bell, it was impossible to say whether the red-vested Briton had done enough.
The answer when it came was 'not quite', Uranchimeg taking the decision by 23 points to 22.
As a distraught Stalker stormed away, the 100-200 Mongolians present – many armed with the highly distinctive red, blue and gold national flag – began their celebrations in earnest.
They had chanted their support throughout the contest, in spite of being comprehensively outnumbered.
Now they assembled in a happy gaggle at the foot of one of the stands.
One fan said that their fighter's performance had made the 11-hour flight to London worthwhile.
It was, of course, a particularly special moment for Uranchimeg himself, boxing in his third Olympics.
"My soul is full of emotion," he said.
"It has been my longstanding dream to get a medal, which I have now achieved."
The watching Chultem Otgonbaatar Sato, first vice president of the Mongolian Sports Press Union, indicated that there was every chance the country's medal haul would grow further in the final days of the Games.
Dates with the figure '8' in had proved lucky for Mongolia in the past, he told me.
This latest Olympic landmark had been achieved on the eighth day of the eighth month.
Mongolia: Racing in the Hoof Steps of Genghis Khan
August 9 (Eurasianet) When Genghis Khan’s army emerged from the Mongolian steppe back in the 13th century, one of the keys to his success was an equine postal system that enabled messages to travel across his vast and growing empire in a matter of days. He oversaw the establishment of a network of horse stations that allowed riders to exchange their exhausted steeds for fresh mounts and keep on moving.
Now, following in the hoof steps of the Khan’s hordes comes a modern-day take on the 13th-century's information superhighway – the Mongol Derby. Billed as the world's longest horse race, this grueling 1,000-kilometer marathon will retrace ancient routes across the rolling steppe with 25 horse stations set up at 40-kilometer intervals.
This year, the race, which has been held annually since 2009, gets underway on August 10. Competitors aim to complete the course on semi-wild mounts in an exhausting seven to ten days. The event aims to raise money for economic development charity work in Mongolia. It’s the brainchild of The Adventurists, the group that is also behind the annual Mongol Rally, a race from London to Ulaanbaatar in a vehicle with an engine size of one liter or less.
For the riders in this extreme equine test, the keyword is “adventure.” There's no route as such: It's up to participants to make their way between the horse stations as quickly as they can. At the stations each must pick up fresh horses. Accommodation is basic: Competitors either share a ger, a round felt tent, with a nomadic family or sleep under the stars in the wilderness.
Mongolian horses are renowned for being ultra-tough and holding amazing reserves of stamina. Let's hope the same can be said about the riders as they set off in the hoof steps of the Mongol warriors.
"Mogi" Munkhdul Badral
Senior Client Manager / Executive Director
CPS International LLC
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