Thursday, August 2, 2012

[CPSI NewsWire: LinkedIn's Mongolian Mining Sector Group's First Networking Event on Friday]

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.

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LinkedIn's Mongolian Mining Sector Group Networking Event on 3 August

July 30 -- Mongolian Mining Sector Group on LinkedIn with Partnership of IARUDI LLC and Mining Gate Mongolia LLC cordially invites you to our first networking event to be held at 7 p.m. on August 3rd, 2012 at Bojangles Restaurant in Ulaanbaatar Mongolia.

As our group, Mongolian Mining Sector on Linkedin has grown, it is time to meet each other and exchange ideas, expertise and knowledge on how we can improve the mining sector in Mongolia. This is a casual networking event that is aimed to help, advise and aid our esteemed members and colleagues in their endeavors. 

The event will be held at 7 p.m. on Friday, August 3rd of 2012 at Bojangles Restaurant, Jiguur Grand Building on Narny Zam Street, next to Monnis showroom.  

The IARUDI Group

Established in early April 2011, IARUDI Group is one of Mongolia's premier professional services firms. Based out of its offices in Central Tower and San Business Centre in Ulaanbaatar the group has approximately twenty five team members based in country full time. A highly skilled and experienced team of Mongolians is complimented by four international chartered accountants (from England, South Africa and Australia), an experienced ex investment banker from Australia and an Australian lawyer.

Boasting an impressive mix of international and local experience IARUDI has created a unique service offering platform to both international and Mongolian clients. The group provides an array of services ranging from transaction advisory and virtual CFO services through to back office accounting and local regulatory compliance. The group also actively identifies business opportunities within Mongolia and either invests or partners with local and international players to convert such opportunities into successful businesses.

Mining Gate Mongolia LLC

The company was founded by Bayasal B. Bontoi in late 2010 with a vision of combining western and eastern ideas and experiences and know-hows in the mining sector of Mongolia. The company itself gives valuable and realistic insights about Mongolia and its current situations in the political, mining, infrastructure, environmental and health sectors to its members and clients.

Over the years, the company has had successful establishments and it has grown into 21 successful consultants, the company now covers all the major sectors in Mongolia, including mining, infrastructure, real estate and property, energy and power, health, oil refinery and etc.

Mining Gate Mongolia LLC welcomes you to the LinkedIn's Mongolian Mining Sector Group's 1st networking event.

Link to Group page


Kincora Copper Announces the Appointment of New President and Chief Executive Officer

VANCOUVER, BRITISH COLUMBIA--(Marketwire - Aug. 1, 2012) - Kincora Copper Limited (TSX VENTURE:KCC) (the "Company" or "Kincora") is pleased to announce that Mr. John Rickus, a director of the Company, has been appointed as President and Chief Executive Officer, effective August 1, 2012.

Mr. Rickus has a degree in Geology and has over 40 years' experience in the mining industry. Mr. Rickus is Head of Technical Services for Origo Partners and the former President of Resolution Copper. His 40+ years of mining experience includes 24 years with Rio Tinto, including six years as head of Technical Services and six years as a mining executive with the Rio Tinto Copper Group. He has previously served on the Board of Directors of Palabora Mining, worked on the Somincor Copper Mine in Portugal, and the Minera Alumbrera in Argentina. He was a member of the Owners' Council for Minera Escondida in Chile and led the technical input on Rio Tinto's behalf in Freeport's Grasberg mine in Indonesia.

Mr. Rickus succeeds Mr. Igor Kovarsky as President and CEO who resigned effective July 31, 2012. The board of directors of the Company wishes to thank Mr. Kovarsky for his contribution to the Company during his tenure as President, CEO and Director.

Link to release


Centerra Gold Reports Second Quarter Results

TORONTO, ONTARIO--(Marketwire - Aug. 1, 2012) - Centerra Gold Inc. (TSX: CG) --

To view Management's Discussion and Analysis and the Financial Statements and Notes for the three and six months ended June 30, 2012, please visit the following link:

Centerra Gold Inc. (TSX:CG) today reported a net loss of $54.6 million, or $0.23 per share based on revenues of $89.7 million. The second quarter loss includes $13.5 million ($0.06 per share) of abnormal mining costs, an other operating expense of $21.0 million ($0.09 per share) for Kumtor's contribution to a national micro-credit financing program in the Kyrgyz Republic in April and a charge of $7.2 million ($0.03 per share) for a gold metal reconciliation adjustment of the stockpiles at Kumtor. For the same period in 2011, the Company recorded net earnings of $71.1 million or $0.30 per common share based on revenues of $243.8 million in the same quarter last year reflecting significantly higher gold production and sales.

Consolidated gold production for the second quarter of 2012 totaled 52,482 ounces at a total cash cost of $885 per ounce produced reflecting lower gold production as a result of the revised mine plan at Kumtor. In the corresponding quarter of 2011, consolidated gold production was 155,166 ounces at a total cash cost of $513 per ounce produced. (Total cash cost per ounce produced is a non-GAAP measure and is discussed under "Non-GAAP Measures" in this news release.)


Ian Atkinson, President and CEO of Centerra Gold stated, "As expected, our gold production was down for the second quarter. While Kumtor continues with its mitigation plan of moving the ice and waste material to allow access to the SB Zone on the southeast side of the pit, we continue the pre-stripping in the southwest portion of the pit and are on track to be in ore by mid-September. We expect to achieve our annual production guidance of 450,000 to 470,000 ounces of gold."

"At Kumtor, the technical and financial study of the potential for expanding the limits of the ultimate pit is continuing. However, the work done to date has produced very encouraging results and indicates that a much larger open pit is feasible, which would result in a significant addition to the open pit reserves and a substantially extended mine life. The opportunity was created by the expansion of reserves and resources in the SB Zone over the last three years, in conjunction with the decision made in March to mitigate the impact of the high movement area by offloading the upper portion of the southeast section of the pit wall."

"The expanded pit would also encompass a significant part of the existing SB underground development and would result in a revaluation of the associated capital investment. Further development work on Decline 1 has been postponed until the study is finalized. The expanded pit may require removal of additional ice and waste material that may have an impact on the short-term (2013-2014) production and financial estimates previously disclosed on May 15, 2012. Significant technical, financial and permitting factors require further study. We expect to complete the study and release its conclusions late in the third quarter."

"Unfortunately for all shareholders, Centerra's share price has been negatively impacted by the recent developments in the Kyrgyz Republic. We believe that the Kyrgyz Parliamentary Commission's report regarding the Kumtor gold project released on June 18, 2012, and its findings are without merit. We believe that Kumtor has operated in full compliance with Kyrgyz laws and meets or exceeds Kyrgyz and international environmental, safety and health standards. This has been shown over the years in systematic compliance audits by both Kyrgyz and international independent experts, who have confirmed Centerra's high level of performance. We also believe that the new agreements we signed in 2009 form a solid foundation for the successful operation of the Kumtor project. The new agreements were approved by all relevant Kyrgyz governmental authorities, including the Kyrgyz Parliament and the Constitutional Court, and all disputes in relation to the new agreements are subject to international arbitration. In response to the Parliamentary report and resolution relating to Kumtor, the Government established a State Commission to examine the parliamentary report and its conclusions, and to initiate revisions to the new agreements that may impact the relevant concession area, tax regime, local operating company management structure and other matters. The Company will work with the State Commission and Government to address the environmental matters raised in the parliamentary report and to resolve other issues identified in the parliamentary resolution in accordance with the new agreements."


At the Boroo mine in Mongolia, gold production was 11,175 ounces in the second quarter of 2012 compared to 16,089 ounces in the second quarter of 2011. The lower gold production is the result of processing low-grade and low recovery stockpiled ore (including low-grade material originally destined for the heap leach operation). The mill head grade averaged 0.86 g/t with a recovery of 69% in the second quarter of 2012, compared to 1.35 g/t with a recovery of 70.3% in the same quarter of 2011. During the quarter, mining activities continued in Pit 6 exposing ore at the end of the second quarter of 2012. Milling of Pit 6 ore is expected to extend to January 2013. The heap leach operation remained idle during the second quarter 2012 pending final permitting and regulatory commissioning by the Mongolian government authorities.

Total cash cost per ounce produced, a non-GAAP measure of production efficiency, was $916 in the second quarter of 2012 compared to $568 in the second quarter of 2011 due to the lower gold production and higher milling costs. Operating cash costs at Boroo increased in the second quarter of 2012 by $4.9 million before the capitalization of $3.6 million for pre-stripping activities in Pit 6 (net increase of $1.3 million) compared to the same quarter in 2011. Milling costs at Boroo for the second quarter of 2012 were $5.4 million, $1.3 million or 31% higher than the same quarter in 2011. This is primarily the result of higher costs incurred for the consumption of reagents, grinding media and electricity in the second quarter of 2012 as 25% higher throughput flowed through the mill compared to the same period in 2011. During 2011, there was a shutdown of the mill caused by the SAG mill repair in May and June 2011 that reduced overall consumption of consumables.

During the second quarter of 2012, exploration expenditures in Mongolia decreased to $2.1 million from $4.1 million in the same period of 2011, reflecting lower activity on the ATO property in northeast Mongolia as the Company focused its efforts on completion of the Mongolian Reserve and Resource Report.

Capital expenditures spent and accrued at Boroo in the second quarter of 2012 increased to $4.9 million including $0.8 million of sustaining capital compared to $2.4 million, which included $0.3 million of sustaining capital in the same period of 2011. 2012 growth capital consisted of cash and non-cash Pit 6 pre-stripping activities resulting in $4.1 million of these costs capitalized in the second quarter of 2012. Minimal capital expenditures were incurred at Gatsuurt, pending resolution of permitting issues related to the Water and Forest Law as the project was put on care and maintenance. Since June 2011, Gatsuurt's care and maintenance costs, including security contractors, have been expensed.

Exploration Update

To view the graphics, maps/drill sections and complete drill results discussed in this news release, visit the following link: or visit the Company's web site at:


ATO Project

The Mineral Reserve Authority of Mongolia (MRAM) formally accepted the ATO reserves and resources as calculated by Centerra Gold Mongolia (CGM). The ATO General Environmental Impact Assessment (GEIA) was also officially approved by the Ministry of Nature, Environment and Tourism. Authorities also outlined watershed areas within the boundaries of the exploration license. Metallurgical test work is ongoing, and hydrological and environmental programs are progressing according to plan.

Exploration drilling resumed in June following formal acceptance of the ATO reserves and resource report. Drilling is targeting extensions and feeders to the pipe-like bodies hosting the current ATO resource and possible strike extensions to the nearby Mungu prospect. Infill soil sampling, IP and trenching have outlined the surface expression of Mungu over some 600 metres of strike length. Drilling will continue at Mungu and ATO through the third quarter of 2012.

Link to release


Centerra Gold Announces Quarterly Dividend of Cdn$0.04 per share

TORONTO, ONTARIO--(Marketwire - Aug. 1, 2012) - Centerra Gold Inc. (TSX:CG) announced today its Board of Directors has authorized a dividend of Cdn$0.04 per common share (approximately US$9.4 million at the current exchange rate). The dividend of Cdn$0.04 per common share is payable on August 30, 2012 to shareholders of record on August 17, 2012. The ex-dividend date will be August 15, 2012.

The dividend is an eligible dividend for Canadian income tax purposes.

In accordance with Centerra's dividend policy, the timing and quantum of dividends are to be determined by the Board of Directors from time to time based on, among other things, the Company's operating results, cash flow and financial conditions, Centerra's current and anticipated capital requirements, and general business conditions. While Centerra currently intends to pay quarterly dividends to its shareholders, there are no assurances in this regard.

Link to release


FeOre: Corporate Presentation, 31 July 2012

July 31, FeOre Limited (ASX:FEO) --

Link to preso


Petro Matad: Notice of Annual General Meeting  

August 1, Petro Matad Limited (LON:MATD) --

Petro Matad advises that the annual general meeting ("AGM") of the Company will be held at 4 p.m. local time (9 a.m. BST) on 12 September 2012 at NIC Building, Amar Street 8, Sukhbaatar District, Ulaanbaatar, Mongolia. 

The notice and form of proxy of the AGM are being posted to shareholders who have opted for hard copy communications and shareholders who have signed up to the Company's electronic communications service will receive notification by email.  A notice of availability and proxy form has today been posted to Deemed Shareholders, being those Petro Matad shareholders that have neither opted for hard copy communications nor provided the Company with an email address to facilitate electronic communications.

A copy of the notice will also be available on the Company's website,, and requests for additional proxy forms should be made to Petro Matad's Registrar, Computershare, via its helpline number of  +44 (0)870 707 4040.

Link to release


Oyu Tolgoi copper-gold-silver mine enters production

July 30 (International Mining) The picture shows the first delivery of ore to the primary crusher from the Southern Oyu open-pit mine. The Oyu Tolgoi project in Mongolia’s Gobi Desert is initially being developed as an open-pit operation, with the first phase of mining to start at the near-surface Southern Oyu deposits, which include Southwest Oyu and Central Oyu. A copper concentrator, with related facilities and necessary infrastructure to support an initial throughput of 100,000 t/d of ore, has been constructed to process ore scheduled to be mined from the Southern Oyu open pit. Initial production of copper-gold-silver concentrate is expected in third quarter 2012 and commercial production is projected to begin in the first half of 2013.

In conjunction with the surface activities, an 85,000-t/d underground block-cave mine also is being developed at the Hugo North Deposit. The throughput capacity of the concentrator plant is expected to be 160,000 t/d of ore when the underground mine begins production.

Link to article


SouthGobi Resources to Announce Second Quarter 2012 Financial Results on August 13, 2012

Conference Call to Discuss Results

HONG KONG, CHINA--(Marketwire - Aug. 1, 2012) - SouthGobi Resources Ltd. (TSX:SGQ)(HKSE:1878) will release its second quarter 2012 financial results before TSX market open on Monday, August 13, 2012.

The company will host a conference call and audio webcast to discuss second quarter 2012 financial results and provide an update on the company's operations. Date and time of the call for various regions will be as follows:

·         Monday, August 13, 2012 at 7:00 p.m. EST / 4:00 p.m. PST

·         Tuesday, August 14, 2012 at 7:00 a.m. Hong Kong Time

Conference call details:

The conference call will also be simultaneously webcast on SouthGobi's website at The archived playback will be available at until August 13, 2013.

Link to release


Successful JORC technical report on Sharyn Gol by Micromine Consulting Services (MCS)

August 1 (International Mining) Headquartered in Ulaanbaatar, Mongolia, Sharyn Gol is involved in the extraction, processing and sale of coal in northern Mongolia, with 100% interest in the Sharyn Gol mine located 215 km north of Ulaanbaatar. Its coal is sold to utility markets for thermal and semi-coking purposes and is used by Erdenet and Darkhan as a main energy source.

Sharyn Gol commissioned MCS to complete a technical report compliant with JORC standard reporting guidelines for the Sharyn Gol mine. For optimum results, MCS ensured all work related to the project was conducted in a meticulous manner, and field work, including supervision of downhole geophysics and drilling was carried out by Triton Coal according to work program procedures established by MCS. Before drilling commenced, the borehole patterns were designed and then all coal was logged and sleeved. If core coal sample recovery was less than 90%, the seam was re-drilled. Sample moisture was maintained by sleeving the coal in plastic and keeping samples at a low temperature. This avoided oxidation, the moisture content was not affected and the calorific value was representative.

The resource estimate modelling was conducted using Coal Measure, Micromine’s coal specific software solution.

Gridding of the thicknesses and surfaces of each seam was initially completed by undergoing a geostatistical analysis to generate a series of semivariograms which were used as the input weightings for the Kriging algorithm. These grids were then converted into a block model.

The JORC-compliant estimate found the Sharyn Gol coal project quadrupled the resource inventory. The report’s findings resulted in further developments of the mine which have enhanced the company’s competitiveness in the domestic and international coal markets.

MCS continues to provide consulting services to Sharyn Gol.

In January 2012 Sharyn Gol announced that the Mineral Resources Authority of Mongolia (MRAM) approved a newly revised mineral reserve of 146.3 Mt at its flagship thermal coal project in northern Mongolia. The revised reserve more than doubles Sharyn Gol’s previous reserve estimate, and follows on from the 2010 drilling program, which established a 374 Mt, largely Measured and Indicated, JORC compliant resource.

Sharyn Gol JSC Chairman, Batkhuu Matmunkh said in the company’s announcement “The newly approved reserve is a significant landmark in the redevelopment of Sharyn Gol.”

Link to article


Prime quality coking coal will remain scarce in the coming days                      

August 1 (Strategic Research Institute ) Over supply culminating in sinking level has become hackneyed topic in colloquial times. However the coming days will see shifting focus from quantity to quality as a survival ploy by the mining majors in Australia. 

Undeniably the drive for coking coal has made steel majors venture into Mozambique and Mongolia to have raw material security at stable prices. Importance for self sufficiency as cost saving tool is more pronounced in economic crisis and declining finished prices. 

However little is known about the quality coking coal and its availability. Dynamics of global coking coal and steel industry will be determined by the availability of right quality of raw material.

Even though are large export capacity additions are coming up in Mozambique and Mongolia quality and availability of the material will remain a issue. Whereas the Mongolian product will be mostly fed into China, Mozambique's medium-low volatile hard coking coal is being promoted in the market at quite high ash levels ranging around 10.5% to 11.0%.

There will be a fair bit of competition between buyers for any premium hard coking coal as it is unlikely that premium hard coking coal supply will be sufficient despite capacity addition.

Global in 2012 291 million tones of coking coal will be exported out which Australia accounts for 143 million tones growing by 10.4% YoY. It is expected to increase to 160 million ton in 2013, jumping to 175 million ton in 2015 and steadily increasing to 211 million ton in 2025. 

In US exports have been forecast to fall to 51 million ton next year followed by 48.5 million ton in 2015 and to 42.5 million ton by 2025.  In the above scenario the future bodes well for the Australian miners who would be commanding levels above USD 200 per ton for prime quality coking coal 2013 as well.

Link to article


BoM issues MNT 120 billion 1-week 13.25% bills

August 1 (Bank of Mongolia) BoM issues 1 week bills worth MNT 120 billion at a weighted interest rate of 13.25 percent per annum. 

Link to release


BoM Auctions Yuan, But No USD on Tuesday

July 31 (Bank of Mongolia) During the forex auction, the BoM sells CNY at closing rate of 211.50. Therefore, the BoM refuses for the bids to sell USD as considering the demand and supply of USD is balanced.

Link to release


Individual and SME Loan Report, 2QBank of Mongolia, August 1

Consolidated Loan Report, 1HBank of Mongolia, August 1


Mongolia – It’s a Wrap!

August 1 (Capitalist Exploits) Well, that was exciting! Mark and I just spent an amazing month on the ground, networking and digging in with some of Mongolia’s best and brightest.

A few days ago we concluded our first Frontier Markets Meet Up in Ulaanbaatar, the capital city. To say that it was a success would be an understatement. We had 25 of the brightest, most interesting and engaging attendees of any event I’ve ever been to. Mark and I are truly blessed to call ALL of these folks our friends now as well. We had a BLAST!

We heard from over a dozen professionals in various disciplines. Brokers, real estate tycoons, entrepreneurs, business professionals, exchange officials, bankers, lawyers and resource execs.

Our new friends learned how business gets done in frontier markets. Don’t ever let anyone tell you that you can invest in these places without visiting, establishing contacts and logging the hard miles.

There are some pretty impressive guys making fortunes as a result of their decision to base themselves there. There’s also a bit of a diaspora occurring.

We met a 21-year old Mongolian who has returned from living in Europe to make his fortune. To say he was an impressive young man would be an insult. He speaks 7 languages fluently for starters. He’s firmly grounded, considerate, calculating and ready to kick some ass. Several of our attendees pulled him aside for private one-on-one discussions. I’m certain that he’ll be doing business with some of them shortly.

I give all of these guys nothing but kudos, as frontier markets are tough, and Mongolia is no exception.

The pollution is horrible. Summer is better than winter, but it’s still awful. We heard several stories of guys leaving within months because they started coughing blood. I can confirm that reality after being there. (Mogi: Come on Mark, I’m sure UB summer air was no different than any other densely populated place)

The traffic is insane and the roads are akin to a detonated mine field. The water and electricity are inconsistent and many Mongolians are not happy about the large foreign presence in their country. Many think that foreigners are there to steal their resources, which includes their women. Rightly so, they are pretty!

I saw a few black eyes, and our partner Scott saw an actual jaw lying in a pool of blood on the sidewalk. Yes, a jaw…nobody attached to it. Players beware! (Mogi: I highly doubt it was a human jaw, Scott)

There is still a good bit of corruption as well. It’s in pockets, but it does exist. You can steer clear of it, and it helps to have the right friends and advisors. Nevertheless, the “fool and his money” saying applies here as strongly as anywhere.

The good news is that opportunity still abounds. Real estate, small business, natural resources, professional services, equipment supply, agriculture, hospitality…these are just a few of the areas where low-hanging fruit exists.

Two Sides to Every Coin

About two weeks ago, as I sipped my morning coffee and looked down from the apartment I was staying in, I watched a drunken man stagger around on the footpath below. A couple hundred metres to his right two inebriated youths clutched a knee-high fence and shared the contents of their stomachs with the grime and mud of the children’s playground…Yummy!

Shortly thereafter I opened the door to head to the office and almost smashed the head of an extremely large, extremely drunk man sleeping in the stairwell, directly in front of my door. I’m pretty sure he had defecated and pissed himself. Ah, the wonders of alcohol!

A post-party cleanup/hangover service would likely do very well here. It would require close to zero start-up capital. Mark and I believe that in Mongolia a small fortune could be made in excrement remediation!

I’m told that 4 of the largest conglomerates in Mongolia where all built on vodka fortunes. That story is consistent with most of the CIS countries, so it may well be true.

I have no statistical evidence but there are probably more people losing their shirt here than those making lots of money. Certainly for naive foreigners this is likely the case. Massive influxes of capital always accompany fraudsters. Making money in frontier markets is akin to pizza without cheese…uncommon.

Incredible opportunity does not come without risk, and those that think it does are routinely and swiftly relieved of their wealth. Lest you think we are perfect, it happened to us in the past as well!

Just because a country is growing at anywhere from 15 – 20% a year means not that YOU will come out ahead. I’ve seen the story play out in other parts of the world time and time again.

That being said, when you have a massive economic tailwind behind you like Mongolia does, there are a few very good ways to play the trend.

How do we do it?

1) Buy the country’s stock index.

It’s a broad and easy-to-make investment, and as the country grows so too will the larger, higher-quality listed equities. Normally you’ll do OK, although at this time Mongolia does not have an index worthy of mention. You can piece together an “index” portfolio of your own by contacting any of the good in-country brokers (see #2 below). We’ve interviewed most of them in our Mongolia Report.

That being said, I’d scrap the idea until we get some liquidity in the market. Our on-the-ground sources tell us that up to 80% of the currently publicly listed equities in Mongolia will be de-listed with the new rules being implemented by the London Stock Exchange (LSE). If you see a company trading for a $700 market cap, it’s for good reason!

2) Buy the largest most liquid stocks on BOTH the MSE, as well as foreign-listed companies operating in Mongolia.

There is a decent bunch on the Canadian and Australian exchanges. Look forward to overpaying though. I see very little opportunity at this stage with this strategy, and mis-pricing of assets is rampant. Caveat emptor

3) Playing the currency arbitrage and yield differential.

Ultimately the Tugrik has to appreciate. This is simply a factor of supply and demand. Short term I’m not super bullish. I expect continued weakness. This of course impacts on the net yield achieved. Everyone who thinks they can fly in and get 16% risk-free on their bank deposit doesn’t understand how currencies work. It’s a two-way street my friends!

Oscar Mendoza…a gentleman far smarter than I, who runs the Mongolia Frontier Fund, enlightened our attendees at the Meet Up as to why they may want to wait a little while before deploying substantial amounts of capital into the banking system. My sense is that purchasing a variety of CD’s from multiple banks is a far better strategy.

Being one to take advantage of a well-thought-out and executed strategy, I’m more comfortable with buying the MSE Liquidity Fund offered by Rescap securities. It solves multiple problems while allowing for good upside potential via its exposure to the MSE as well as fixed-rate, short-term deposits.

4) Start your own business.

Opportunities abound in this space. See my excrement remediation example earlier. But seriously, as our friend Harris Kupperman said to us on multiple occasions, a bagel shop would kill it in UB; as would a natural products grocer, a plastic surgeon, a peddler of European luxury goods of any flavour, or the guy who can manage to get Starbuck’s to setup shop (or McDonald’s). A well-known US pizza franchise is opening 12 locations, they will kill it, that is if their delivery guys can actually get the pizza delivered in UB traffic before it’s a pizzicle. Lots of execution risk in that one!

5) Buy stakes in privately run companies.

Also known as private equity (PE). Most of the thousands of companies in Mongolia are very small. Right now there are literally dozens of private equity funds who want to participate in the PE market, with collectively hundreds of millions to put to work. Unfortunately, most of them are completely misguided and will end up torching their investors.

They are raising ridiculous sums looking to participate in a microscopic market. I wish them the very best of luck. Firstly, running something like this from an office in Singapore, London, N.Y. or Hong Kong impresses me as superbly idiotic, and a first class opportunity to get screwed…and not in the enjoyable way.

Our CPAN service is a result of Mark and I identifying what we believe to be a unique set of circumstances in the frontier markets right now, including Mongolia. It also addresses the problems being encountered by many a PE fund manager looking to deploy capital in these “micro markets”. The main problem being the size of the deals, and the deal flow.

We discussed the service in-depth on a conference call recently, and at our Meet Up. Unfortunately the conference call had “technical” difficulties. We’ve prepared a transcript complete with Q&A. It will be disseminated to anyone who wants to learn more about the service.

If you’re interested in frontier markets private equity, and you’re an accredited investor or PE fund manager, I encourage you to checkout CPAN to see what we’re so excited about.

We have about half our slots filled, and we fully expect the balance of spaces to go very quickly, since we can only take a maximum of 40 participants.

- Chris

“I think this is also a great time to invest in private equity, helping companies grow from the ground up.” – Jim Rogers

Link to article



August 1 (InfoMongolia) The General Department of Taxation (Mongolian Tax Administration) and the "Mongol Post" state owned company have signed on a memorandum of cooperation on introducing postal service in Taxation Department, receiving and auditing tax declarations via postal network and starting tax return postal system.

Following the memorandum the official postal taxation system will be effective from August 01, 2012. Thus, starting from today entities within Ulaanbaatar are enabled to send and receive their tax declarations through 30 postal branch offices in the city, where in localities over 400 postal branch offices through the country will serve to receive and send the declarations.

The new service saves civilians time and no longer queues will be formed in submitting the declarations. Further, the system also enables citizens to avoid missing the deadlines. The General Department of Taxation will straight away to inform the receiving of declarations via SMS and e-mail to the particular submitter.

Link to article


Key Witness Testifies in Ex-Mongolian President's Trial

August 2 (Xinhua) A local court heard testimony from a key witness in the trial of former Mongolian president Nambar Enkhbayar on corruption charges Wednesday.

State prosecutors read testimony to Sukhbaatar district court from Demberel Choijamts, abbot of Gandan monastery, about the donation of television equipment at the center of one of the charges.

Enkhbayar is charged with illegally using the equipment to set up his own television station.

The abbot, who did not attend the hearing because he is attending the London Olympics with President Tsakhia Elbegdorj, said in his statement he visited Japan at the invitation of Japanese Buddhist organization Agon Shu, based in Japan's Kyoto, with Enkhbayar in 2000.

"Before the trip, there was discussion with Agon Shu about setting up a TV station under the monastery. It was my understanding that the TV equipment donated by the Agon Shu was for Gandan monastery for Mongolian Buddhists," the statement said.

"I don't know what Enkhbayar talked about with the Japanese. Our monastery later received some money for ownership of the TV station set up by Enkhbayar and the money was spent on building Mongolian Buddhist temple in India," he said.

However, S. Narangerel, one of Enkhbayar's defense lawyers, said: "The Japanese Buddhist organization made a personal donation to Enkhbayar and Choijamts. Since the monastery was not able to pay the customs tax, another prominent Mongolian businessman paid all the due customs taxes and helped set up the TV station."

Enkhbayar was arrested on April 12 on the television equipment-related charge, as well as charges of being involved in the illegal privatization of a hotel and a publishing house.

His trial has drawn much public attention in Mongolia and was broadcast live on some television channels.

Supporters of Enkhbayar, who was president from 2005 to 2009, say he has been framed by Elbegdorj for political reasons.

Enkhbayar narrowly lost to Elbegdorj in the 2009 presidential election. Enkhbayar initially conceded but later rejected the election results, claiming irregularities.

The trial is expected to continue Thursday.

Link to article



August 1 (InfoMongolia) On August 01, 2012, the plenary session of the State Great Khural (Parliament) has started, where the "Justice" Coalition (MPRP-MNDP) candidates Ts.Tsolmon and O.Baasankhuu have taken their oaths and have officially became the Members of the Parliament of Mongolia.

The Speaker of the Parliament Z.Enkhbold congratulated and wished them to have a great success in their term of duties. Also, with the meeting was discussed the issue of appointing the Chairman of the Parliament Standing Committee on State Structure.

With the Democratic Party grouping meeting held earlier in the morning, the Member of the Parliament A.Bakei was nominated for the Chairman of the State Structure’s Standing Committee, where he was elected to the position with a 92.7% of votes.

Afterwards, plenary session has taken a temporary break after resolving the above issues. All Parliament members, except for the members of the Mongolian People’s Party Parliament group, were participating in the session today.

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August 1 (InfoMongolia) On July 31, 2012, the trial of the Head of the Mongolian People's Revolutionary Party (MPRP) N.Enkhbayar had started at the Sukhbaatar District Court at 10:00 am as scheduled.

N.Enkhbayar is being convicted under the Criminal law article number 150.3, “Causing large amount of mischief to others”, and article number 163.2, “Acts of repeated or grouped nature, or abuse of power, and gain of a large amount of income”. The trial was headed by the Sukhbaatar District Court General Judge S.Soyombo-Erdene, with S.Oyunchimeg and M.Aldar acting as judges and Yo.Sagsai and O.Munkhbaatar acting as state prosecutors. This was a public open trial, where TV9 television transmitted the live coverage of the trial procedure.

Former President N.Enkhbayar’s lawyer S.Narangerel had stated prior that there would be no issue of postponing the trial from the side of the lawyer as he had fully familiarized with the case files of the defendant. However, S.Narangerel delivered a claim requiring obligatory presence of witnesses, victims and analysts, where it was declined by the court.

At the beginning of the trial, the lawyer of the defendant S.Narangerel had abnegated from the state prosecutor Yo.Sagsai. He addressed the judges’ panel, saying “When defendant N.Enkhbayar had not been held up guilty, Yo.Sagsai had repeatedly spoken through media outlets as if he was. I abnegate state prosecutor Yo.Sagsai as it seems as he is addressing this case from personal interests.” In reply Yo.Sagsai said, “This case has been running since 2011. I don’t have neither personal interest nor grudge in this case. I am participating only on the part of the state prosecutor.” The trial took a short break, where the judges’ panel discussed whether to abnegate Yo.Sagsai or not, and have decided to decline this request. After, lawyer S.Narangerel also requested to abnegate from the trial leader, General Judge S.Soyombo-Erdene on the grounds that he was addressing the case on personal interest too, which was declined by the panel as well.

The trial had went on from 10:30 am until 10:00 o’clock in the evening, where it was to continue today (August 01, 2012) starting at 09:30 am. Today’s trial is being held behind closed doors under ensuring the security of the witnesses, victims and analysts.

These witnesses and victims were not present on yesterday’s trial.

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July 31 (InfoMongolia) July 30, 2012, the Investigation Division of the Independent Authority Against Corruption (IAAC) of Mongolia has held a press conference, where they informed on the clearances and inspections of personal interest, asset and income reports of officials.

In the first half of 2012, the IAAC has inquired asset and income reports of 3,116 state servants, where accurate inquiry was run on reports of 225 officials. If one is nominated to a social job position, prior to his appointment he/she must release a preliminary personal interest report, where it will be monitored by the IAAC.

Out of 564 officials’ preliminary reports delivered to the IAAC from 100 organizations, evaluations were made on the personal interest conflicts of for 534 servants and were delivered to the associate organizations.

Also, during this period were conducted investigations on 109 criminal cases of 434 acts, which is an increased results by 23% compared to the same period of 2011. Moreover, compared to the same period of the previous year, bribery receiving criminal cases increased by 12%, whereas bribery provision criminal cases increased by 80%.

As for the settlement of investigated criminal cases, 22 cases or 20% of the total investigated cases were settled on conviction, 15% were transferred according to affiliation, 17% were integrated with other criminal cases and one case was suspended from investigation.

The total worth of casualties was at 23 billion MNT, out of which 1.3 billion MNT has been reimbursed during the investigation process and assets worth 3.6 billion MNT were sealed.

A total of 179 persons were inquired as suspects and convicts in criminal cases, which is an increased result by 65% compared to the same period of the previous year. Out of these people, 22 were political figures, 35 were state administration officials, 11 were state special service officials, 32 were state service servants and 79 persons were employees of entities and organizations.

During the press conference, the Head of Investigation Division, IAAC E.Amarbat noted that during the investigation of any case, the lawyers were conspiring with the associate organizations thus causing complication in the investigation procedure, and has appealed state and public organizations to declare the year of 2013 as the Year Against Corruption.

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August 1 (InfoMongolia) The Spanish Webometrics Ranking of World Universities released its biannual ranking list. This ranking released as of July 2012, includes 22 Mongolian Universities and Institutes.

Webometrics Ranking of World Universities is ranking system for the world's universities based on a composite indicator that takes into account both the volume of the Web contents (number of web pages and files) and the visibility and impact of these web publications according to the number of external inlinks (site citations) they received.

The aim of the Ranking is to improve the presence of the academic and research institutions on the Web and to promote the open access publication of scientific results. The ranking started in 2004 and is updated every January and July. Today it provides Web indicators for more than 12,000 universities worldwide.

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Mongolia Up Close and Personal

July31, (Colorado State University) July 30, 2012: Stories from the Field. This guest post is by Team NOYA Fibers (Greg Goble, Steph Knisely, and Brenda Piloya), students in the Global Social & Sustainable Enterprise MBA Program at Colorado State University.  Team NOYA traveled to Mongolia for 10 weeks this summer to work on a sustainable cashmere venture. Below they depict one particularly moving experience.

We had already run through this scenario a dozen times before – meet with nomadic herding families throughout the Toson Khulstai Natural Reserve in the Steppes of Eastern Mongolia, consume endless cups of milk tea and sun-dried yogurt chips while we ask our herder subjects to discuss difficulties and challenges, concerns and aspirations facing their herding lifestyles.  But, this time was somehow different. This time, instead of trying to bridge a massive communication gap between ourselves and the nomadic community while utilizing the services of a relatively inexperienced interpreter, we found a greater sense of connection with the family.  Instead of asking a number of follow-up questions to the herder in efforts to tease out an authentic response that deciphers the true health of his land and animals, the herder came forward with an honest and compelling soliloquy.  He openly communicated his fears of the deteriorating condition of the grasslands, the weakening health of his animals, and the necessity for herders to work together to try to conserve their land and reverse the inevitable tides of overgrazing so that future generations of herders may be able to live out their lives carrying on the traditions and practices of nomadic culture.

After the herder finished speaking, we then proceeded to divulge greater detail into our intentions for working in Mongolia.  We explained to the herder and his family that we had come to Mongolia to research the possibility of creating a market-based solution to overgrazing.  We wanted to speak with herders to understand the trials and tribulations they faced throughout their herding lifestyles, and attempt to unite them under a common cause to help conserve their herding traditions and protect the environment that they depend on.

After notifying the herder of our intention to connect their product to international markets and have him be paid fair and consistent prices for his cashmere, his positive reaction was so genuine and sincere that despite the mile high barrier in verbal communication between us, we were able to fully understand his excitement through the joy and sheer delight in his eyes.

We uncovered that the true reason for his delight was because of the sense of empowerment that we could provide the herder. Never before had he even considered partnering with international companies to sell his products due to his restricted access to distribution channels.  Previously, due to his limited market exposure, the herder was forced to sell his goods to traveling businessmen, or ‘changers’, who offered him below-market prices for his high quality products, which was a common occurrence amongst many of the herding families we met.

Overall, as a team we have met with close to 50 herding families, all of whom told a similar story of the difficulties facing their lands, lifestyles, and livelihoods. What we realized was that we are not simply trying to increase their annual income through the sale of their products to international markets, but we are providing herders a framework through which they can empower themselves by gaining leverage in the free market.  Additionally, this helps conserve the grasslands that they depend upon for their livelihoods.  And most importantly, we are providing the structure for herders to stop feeling like pawns.  In fact, they too can make a difference in our world.

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Perceptions of healthcare professionals regarding the main challenges and barriers to effective hospital infection control in Mongolia: a qualitative study

August, 2012 (BioMed Central) --


It is not fully understood why healthcare decision-makers of developing countries often give low priority to infection control and why they are unable to implement international guidelines. This study aimed to identify the main perceived challenges and barriers that hinder the effective implementation of infection control programmes in Mongolia.


In 2008, qualitative research involving 4 group and 55 individual interviews was conducted in the capital city of Mongolia and two provincial centres.


A total of 87 health professionals participated in the study, including policy and hospital-level managers, doctors, nurses and infection  control practitioners. Thematic analysis revealed a large number of perceived challenges and barriers to the formulation and implementation of infection control policy. These challenges and barriers were complex in nature and related to poor funding, suboptimal knowledge and attitudes, and inadequate management. The study results suggest that the availability of infection control policy and guidelines, and the provision of specific recommendations for low-resource settings, do not assure effective implementation of infection control programmes.


The current infection control system in Mongolia is likely to remain ineffective unless the underlying barriers and challenges are adequately addressed. Multifaceted interventions with logistical, educational and management components that are specific to local circumstances need to be designed and implemented in Mongolia. The importance of international peer support is highlighted…


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