Monday, April 22, 2013

[Amended SEFIL passed but to be replaced, GoM to accelerate development of OT, and IMF revises 2013 GDP forecast to 14%]

CoverMongolia NewsWire
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Cover Mongolia
Mogi: please be aware that from May, CoverMongolia NewsWire is switching to subscription based, but I will have a cut version for non-paying subscribers.
Cover Mongolia Fundraising Proposals
Dear subscribers,
Here are 3 fundraising ideas I'm launching:
<![if !supportLists]>1)    <![endif]>Donation Scheme for Individuals: To pilot the donation scheme starting in the near future. I will set up a PayPal account for anyone residing overseas, and a local bank account for individuals residing in Mongolia.
<![if !supportLists]>a.     <![endif]>Starting from May, I would run two different versions of the newswire. One to donors the current version, and a cut version to non-donors. A cut version would mean just the headlines and first few paragraphs with no links.
<![if !supportLists]>b.    <![endif]>Donations could be on a quarterly basis
<![if !supportLists]>2)    <![endif]>Banner Advertising: Also, I'm proposing an opportunity to advertise on the newswire as well. A top banner as you see above and 6 Middle Banners seen below, positioned between sections 1. Overseas Market 2. Domestic Market 3. Economy 4. Politics 5. Business 6. Diplomacy and 7. Social, Environmental, Others. Pricing proposals could be:
<![if !supportLists]>a.     <![endif]>50,000 per issue for Top Banner,
<![if !supportLists]>b.    <![endif]>45,000 per issue for Middle Banner 1,
<![if !supportLists]>c.     <![endif]>40,000 per issue for Middle Banner 2,
<![if !supportLists]>d.    <![endif]>35,000 per issue for Middle Banner 3,
<![if !supportLists]>e.    <![endif]>30,000 per issue for Middle Banner 4,
<![if !supportLists]>f.      <![endif]>25,000 per issue for Middle Banner 5, and
<![if !supportLists]>g.    <![endif]>20,000 per issue for Middle Banner 6
<![if !supportLists]>3)    <![endif]>Corporate Subscription: Since the newswire is going to be split into a full and a cut version, I thought perhaps this would create an incentive for individuals to convince their companies to pay for the subscription. Pricing scheme could be in the range of 100,000-500,000 a month depending on company size and relevance of my newswire to their business.
<![if !supportLists]>a.     <![endif]>Best way for companies to take it would be: Wouldn't it be much more expensive than 500,000 to hire a person to do this type of market research?

Overseas Market
Cabinet to Intensify Development of Oyu Tolgoi
April 21 (Cover Mongolia) A "decision" was made during this Saturday's regular cabinet to "intensify" the development of Oyu Tolgoi in order to achieve its target of exporting concentrate on time.
The cabinet meeting press release also noted that OT is scheduled to commence exports from June.
The cabinet also instructed Mining Minister Gankhuyag to resolve outstanding issues such granting necessary land, Oyu Tolgoi - Gashuu Sukhait road, foreign labor permits, concentrate customs clearance, environmental, water, power station, external audit laboratory, and infrastructure corridor.

Oyu Tolgoi CEO Says Funding Advanced; Mongolia Talks Constructive
LONDON, April 17 (WSJ) Rio Tinto PLC (RIO) and the Mongolian government have had constructive talks over the terms of investment in Mongolia's massive Oyu Tolgoi copper and gold project, said OyuA  Tolgoi LLC chief executive Wednesday, as it continues to make progress in securing new funding for the next growth phase of the project.
Cameron McRae, who is also president of Oyu Tolgoi LLC, said that discussions with banks to secure financing for the next phase of the mine expansion are well advanced.
Rio Tinto controls Oyu Tolgoi LLC, the company responsible for developing Mongolia's biggest investment project, through its holdings in Toronto-listed Turquoise Hill Resources Ltd. (TRQ). Under a 2009 agreement, Mongolia owns a 34% stake in Oyu Tolgoi but is refusing to support Rio Tinto's efforts to raise as much as $6 billion to fund the next phase of development and has queried what it says are rising costs for the project.
Rio Tinto and Mongolia have agreed to continue funding the US$6.2 billion first phase of the Oyu Tolgoi mine in the Gobi Desert, keeping it on track to begin producing in June as they try to resolve a dispute over costs. But a key concern is whether Rio Tinto will be able to secure funding for the second phase of the project where capital expenditure has escalated due in part to a 30% increase in the cost of building an underground mine, including higher contingencies, contractor costs and owner execution costs.
The second phase of the project is still expected to cost $5.1 billion to build, despite the exclusion of a $1.16 billion coal-fired power station and $645 million concentrator expansion from the plan.
Some Mongolian government officials are concerned that the higher costs may delay Mongolia's ability to earn more revenue from the project. Mongolia's 2013 budget proposal introduced a revenue stream from a progressive royalty tax on Oyu Tolgoi that hadn't been previously approved by Oyu Tolgoi's shareholders, in line with the 2009 investment agreement.
Mr. McRae said at the Mongolian Investment Summit here that "constructive progress continues to be made" between Rio Tinto, Turquoise Hill and the Mongolian government regarding the agreements that underpin the future expansion of the project and how to secure support for financing the project. He said that bank funding for the second phase "is now well advanced."
Mr. McRae also added that other investors are keen to see Oyu Tolgoi succeed in securing its second phase financing in order to attract more investment to Mongolia. "This may sound self-serving, but other business people know that the project financing of OT will solidify a set of banking relationships for Mongolia that will make access to capital one step easier for major projects," he noted. "It is clear that a successful OT is needed as a core part of a successful economic and business future for Mongolia," he added.
The creation of a new foreign direct investment policy, a new minerals law and amendments to the investment law are also very welcome, Mr. McRae said. "While the business community still has some concerns, these are strong signals from the government about its commitment to attracting more investment."
Lastly he said that investors weren't a guarantee of "the sanctity of contracts, delivering a stable, predictable environment for business to get on with the job of business."

Mongolia Confident Oyu Tolgoi Mine Dispute Can Be Resolved Soon-Minister
April 17 (WSJ) The Mongolian government is confident it can resolve a dispute with Rio Tinto PLC (RIO) regarding the massive Oyu Tolgoi copper and gold project in as little as a "few weeks," Mongolia's deputy minister of economic development said Wednesday.
Rio Tinto and the government of Mongolia are currently discussing issues such as rising costs at Oyu Tolgoi and tax pre-payments, said Ochirbat Chuluunbat on the sidelines of the Mongolia Investment Summit here.
The government is concerned that rising costs could delay its ability to reap more profits from the project.
"There is no big problem," Mr. Chuluunbat said, adding he expects a solution to the impasse before the June 28 presidential elections. "It is negotiable. It's not a big deal," he added, noting that the parties involved should reach a solution, if not in a few weeks.
Cameron McRae, the chief executive of Oyu Tolgoi LLC, the unit that's majority owned by Rio Tinto through Turquoise Hill Resources Ltd. (TRQ.T) said in a speech on the same day that the two sides have made "constructive progress."
"Whilst some of the issues are complex, I am confident these discussions will resolve them and we will deliver the promise of Oyu Tolgoi together," he added.
The Oyu Tolgoi project is due to start commercial production by the end of June. The cost for developing the first phase of the mine has increased to $6.2 billion from an initial $4.6 billion capital expenditure budget, according to Mr. Chuluunbat.
The cost for the second phase of the project has also escalated due to a 30% increase in the cost of developing an underground mine and providing contingencies, among other things.
The discussions between Rio Tinto, Turquoise Hill and the government as well as stricter controls on foreign direct investment introduced last year have weighed on foreign investor sentiment regarding Mongolia.
Mr. Chuluunbat said that the government wants to change that perception.
"In the last six months we have noticed some slowdown of the economic growth in Mongolia due to reduction of direct foreign investment in Mongolia," he said. "So we have now drafted a new law on investment" to encourage investors.
The law aims to provide certainty to investors that rules that apply to their investments today won't change in the future, according to Mr. Chuluunbat.
"The basic idea is we want to send a very strong message on the stability and clarity of the treatment of foreign investment in the future in Mongolia," he said.
"If you put in investment today, your investment...will be regulated over five, 10, 20 laws and regulations of today so that future amendments in four or eight years won't affect investment regulations of today," he said.
The new investment law will apply to all private sector investment while investment from state-owned enterprises will still require parliamentary approval, Mr. Chuluunbat said.
He noted that the new investment law has already been drafted and will be submitted to Mongolia's Parliament before July 10.

Mongolia Says Rio Mine Audit Seeks Answers on $2 Billion Overrun
April 18 (Bloomberg) Mongolia said it's undertaking an audit of Rio Tinto Group (RIO)'s Oyu Tolgoi operation as it seeks to understand the reasons for an alleged $2 billion cost overrun at the mine where output is due to start in June.
"We are checking procurement documents and expenditures," Finance Minister Chultem Ulaan told reporters yesterday in the capital Ulaanbaatar. "No one understands why the project has gone $2 billion over budget, so we are checking this."
The $6.6 billion Oyu Tolgoi mine will be the largest contributor to Mongolia's economy and is estimated to account for one-third of the nation's gross domestic product by 2020. The government's audit team is studying what equipment was bought for the mine and its cost, said Ulaan. The operators of Oyu Tolgoi have brought in a foreign auditor, he said.
Oyu Tolgoi is 66 percent owned by London-based Rio Tinto, the world's second-largest mining company, with the remainder controlled by the land-locked nation. They've been in dispute over alleged cost overruns and management control with three emergency shareholder meetings held this year.
Mongolian President Tsakhia Elbegdorj said in February the country should have more control over the project, prompting Rio to threaten delays to the start of production. Talks on legislation governing Rio's investment at the mine are continuing.
"The agreement is fine, there are just some parts that need to be streamlined so it will be more efficient," minister Ulaan said. "We don't intend to increase the tax on Oyu Tolgoi, we are just saying that they should pay what every other mining company pays."
Tax Demand
Ulaan repeated a claim that Rio Tinto owes taxes to the government for 2012.
"We believe that Oyu Tolgoi needs to pay taxes for 2012," he said. "We have that position. All the companies should follow the law."
Cameron McRae, chief executive officer of Oyu Tolgoi LLC, a unit of Rio Tinto, said yesterday at a conference in London that "constructive progress" is being made in talks with the government.
"The focus is both on reviewing progress to date and ensuring that production and future expansions are delivered together – and that critical agreements and finance are supported," he said.
The company is well advanced in funding talks for an expansion of Oyu Tolgoi, he added.
'Most Attractive'
"Bank funding in the form of project finance is the most attractive finance option because it is cheaper and better tailored to the project than any other option currently available," McRae said. "The process is now well advanced."
A London-based spokesman for Rio declined to make any further comment.
The underground component of the planned mine expansion includes 250 kilometers (155 miles) of tunnels and may cost $5.1 billion, according to a report last month by Rio Tinto unit Turquoise Hill Resources Ltd. (TRQ)
The boards of International Finance Corp., the World Bank's funding arm, and the European Bank for Reconstruction and Development granted approval in February for the lenders to join a $4 billion project-finance deal for the Oyu Tolgoi mine.

Rio Tinto accused of environmental and human rights breaches
April 18 (The Guardian) Native Mongolian herders angry that copper and gold mine is threatening fresh water supply and ecology
Protesters from around the world attacked mining company Rio Tinto for a string for alleged environmental and human rights breaches during a fiery meeting with shareholders in London on Thursday.
Native Mongolian herders claimed that a $5bn (£3.3bn) expansion of the company's Oyu Tolgoi copper and gold mine in the Gobi desert threatened the fresh water supply of hundreds of nomadic people and the area's unique ecology.
Sukhgerel Dugersuren, executive director of Mongolian civil society organisation Oyu Tolgoi Watch, said: "Water is a life and death resource. Rio Tinto is diverting water without the consent of the local community or the government.
"It is already evident that not only livestock but local communities are losing access to adequate water supply. Pasture ... [and] water resources are being taken from us and fenced in by the mine."
She claimed that a tailings pond used to collect waste material from the mine had leaked and told Rio's board that the local community demanded assurances that "there isn't going to be a catastrophe in the region".
Sam Walsh, Rio's new chief executive, said the company was committed to environmental protection and human rights and was closely monitoring the mine's development to "ensure our neighbours have a healthy and prosperous future".
At the company's annual meeting, Walsh said Rio recognised the importance of water and would draw water from a deep level aquifer, not from surface water. He said a seasonal river was being diverted around the mine, but the company would create a new spring for animal grazing and water collection further downstream.
Walsh said the mine, which is 34%-owned by the Mongolian government, would provide a massive boost to the local economy and could represent up to 36% of Mongolia's GDP.
Protesters also raised concerns about Rio's planned mines in Bristol Bay, Alaska, a controversial iron ore mine in Guinea, and a nickel and copper mine in Michigan.

Aspire Mining appoints Noble Group senior executive to Board
April 18 (Proactive Investors) Aspire Mining (ASX: AKM) has appointed Hannah Badenach as a non-executive director.
Badenach is currently vice president of asset development and operations for Noble Group (SGX: N21) subsidiary Noble Resources.
She has considerable experience in management and development within Mongolia. 
Badenach has previously practised law for several years in Asia, including two years in Mongolia with Lynch & Mahoney
From 2006 she was managing director of QGX Mongol LLC, a coal explorer and developer prior to its takeover in 2008 by Mongolia Holdings Corporation. (Mogi: subsidiary of Kerry Holdings)
Aspire last week completed a Rail Pre-Feasibility Study Revision confirming that it could save US$200 million by taking a more direct route further to the south for its proposed Erdenet to Ovoot rail extension in Mongolia. 
This reduces capital expenditure for the rail line to US$1.3 billion.
Importantly, further capital expenditure cost savings are possible from a de-rating of haulage capacity from 22 million tonnes per annum to an initial starting capacity of between 10 and 12Mtpa. 
Aspire has the second largest coking coal reserve in Mongolia at Ovoot and the coal ranks among the highest quality coking coal in the world.
The company will continue to work on advancing the Erdenet to Ovoot railway by providing more engineering definition and progress towards a Bankable Feasibility Study.

Mongolia Growth Group Ltd. Publishes March 2013 Monthly Letter to Shareholders
Ulaanbaatar, MONGOLIA, April 17, 2013 /FSC/ - Mongolia Growth Group Ltd. (YAK - TSX Venture), is pleased to announce the release of its March 2013 letter to shareholders. 
March 2013 Shareholder Letter 
To the Shareholders of Mongolia Growth Group Ltd., 
I am now in Ulaanbaatar watching as the snow slowly melts away. With the warmer temperatures, leasing activity is beginning to pick up. Once again, we are seeing increases in rents as the 2013 season begins. Just as interestingly, we see very robust demand for high quality locations
If you look at why real estate investment in an emerging economy is so successful, there are really two drivers to increasing valuations. The first driver-the one that is very important in the earlier stage of a country's development-is the rapid increase in rents due to a growing economy. We have already witnessed this in many ways over the past two years-in very rough terms, retail rents in downtown have effectively doubled while office rents aren't very far behind that. While, office rents will eventually top out due to increases in supply, our research shows that retail rents should continue to increase with the increase in disposable income created by a booming economy. 
The other factor in property price appreciation, which shows up later in the cycle, is the creation of a strong banking sector and mortgage market. For a point of reference, today in Ulaanbaatar, if you want to borrow US Dollars they will cost you nearly 20% while Mongolian Togrog will cost you over 25% a year. In addition, it is difficult to get mortgages that are longer than a few years in duration. Clearly, this is the reason for mid-teen yields on premium stabilized assets-with many second tier assets valued at over 20% yields. In the past few months, we have seen a number of data points that would make us believe that interest rates may have begun to decline and lead to this second leg of price appreciation becoming relevant
In 2012, the Mongolian government raised $1.5 billion at interest rates of 4.125% for $0.5 billion and 5.125% for $1.0 billion. This money is now filtering into the economy as the government chooses various programs to finance. For a country that has been starved of capital, $1.5 billion of low cost capital injected into a $9.96 billion 2012 GDP goes a very long way towards reducing everyone's cost of capital. Even more importantly, with inflation starting to moderate, the Mongolian Central Bank has recently reduced the policy rate to 11.5 percent from 13.25 percent as recently as March, 2013. I expect that this will spur additional economic growth. Finally, it is rumored that a number of multi-national banks have recently applied for banking licenses in Mongolia. While there is no way to know if they will be granted licenses, reduced borrowing costs would go a long way towards lowering property yields and increasing property prices. 
In summary, I feel that we are at the start of the period where Mongolian interest rates begin to decline to rates similar with more developed countries. This all seems to support a new growth phase in property prices following the dip in prices in the last half of 2012. More importantly, evidence on the ground seems to support this thesis as we've seen some increases in prices as the weather has grown warmer. 
To view the two graphics associated with this newsletter, click onto the following link: 
At MGG, we are very proud of our success over the past two years. Please join me at New York's Hotel Pennsylvania on May 9th 2013 at 5:30pm for a presentation on what we've accomplished and what we are looking at for the rest of 2013. Naturally, this presentation will be accompanied with our standard hospitality, including cookies. 
In addition, we have announced the dates for our shareholder visits to Mongolia. As you are likely aware, it's one thing to read a bunch of dry filings from our company-it's quite different to actually travel to Mongolia and see our assets in person. Much more importantly, you'll be able to visit a country that has become quite special to me. 
Since we started this company, we've had dozens of visitors and I hope that you will come and join us this year during our two scheduled visiting dates of June 15-18 and September 7-10. As always, the trip will include visits to our assets, a tour of Ulaanbaatar and meetings with prominent Mongolians so that you will be able to improve your understanding of what makes the Mongolian economy work. Finally, no trip to Mongolia is complete without a trip to the countryside. I look forward to seeing all of you. 
Harris Kupperman
Chairman & CEO
Mongolia Growth Group Ltd. 

BDSec MGG Follow-Up: UB Property Market Starting To Heat Up Again
April 18 (BDSec) --
<![if !supportLists]>-       <![endif]>Recent transactions suggest select local real estate has not only bottomed, but is reaccelerating at a rapid rate.
<![if !supportLists]>-       <![endif]>Prime Peace Avenue ground floor retail, which bottomed at $2500 per square meter in late 2012, is now trading at $3000-$4000, with little if any available supply.
<![if !supportLists]>-       <![endif]>Investment demand, lower interest rates and the emergence of International fast food franchises appear to be driving prices.
<![if !supportLists]>-       <![endif]>The strongest part of the market currently are price points below $1M USD, suggesting there is still value and opportunity in larger, distressed projects
<![if !supportLists]>-       <![endif]>We reiterate our Buy rating and $6 CAD price target
We recently completed a property tour focused on the prime ~2.5 Kilometers which we define as the Downtown Core and Central Business District of Ulaanbaatar. We were surprised not only by the price levels of recent transactions, but the lack of available supply at price points below $1M USD. Conversations with local brokers and industry contacts suggest demand is broad based, with supply being limited and asking prices stubbornly high. There appears to be 6 primary trends pushing prices as far as we can tell, these are:
<![if !supportLists]>1.    <![endif]>Foreign demand, especially from Asian investors.
<![if !supportLists]>2.    <![endif]>Central bank liquidity, with the target rate being cut to 11.5% from 13.25% in the last 4 months.
<![if !supportLists]>3.    <![endif]>Fast food franchises coming to UB, a trend that is likely to accelerate.
<![if !supportLists]>4.    <![endif]>Reacceleration of the local economy.
<![if !supportLists]>5.    <![endif]>Central Bank providing $600M in low interest rate loans to local commercial banks to improve liquidity.
<![if !supportLists]>6.    <![endif]>The imminent emergence of a government supported mortgage market, with lower and longer term subsidized funding

Manas Petroleum Corporation Announces reorganization of Officers and appointments of Committee Members
BAAR, Switzerland, April 16, 2013 /PRNewswire/ -- Manas Petroleum Corporation ("Manas" or the "Company") (TSX‑V: MNP; OTCBB: MNAP) announced today that on March 25, 2013, Peter-Mark Vogel resigned as Chief Executive Officer. The board of directors appointed Dr. Werner Ladwein , as CEO & President and reappointed Ari Muljana as Chief Financial Officer.
Further, Michael Velletta , Director, has resigned as Corporate Secretary and Mr. Peter-Mark Vogel has been appointed by the board.
The Board of Directors would like to thank Peter-Mark Vogel for his contribution to Manas in the past years and wishes him well for his new assignment.
Appointment of Committee Members:
Also on March 25, 2013 the board of directors have appointed Michael Velletta (Chair), Dr. Richard Schenz and Murray Rogersas members of the Audit Committee.
The Corporate Governance and Compensation Committee consist of Darcy Spady (Chair), Heinz. J. Scholz and Michael Velletta.
Murray Rodgers (Chair), Dr. Werner Ladwein and Darcy Spady were appointed as members of the Reserves Committee.

Manas Petroleum Corporation announces shareholder and investor conference call
BAAR, Switzerland, April 18, 2013 /PRNewswire/ -- Manas Petroleum Corp. ("Manas") (OTCBB: MNAP) (TSX.V:MNP) today announced that they will hold a shareholder and investor conference call on April 23, 2013 at CET 5.00 pm / EDT 11.00 am / PDT 8.00 am.
Dr. Werner Ladwein , CEO & President of Manas will give an update about our current activities, followed by a Q&A session.
Our Investor Relations Update will be the base for the conference:
To attend at the call please register under the following link:

Centerra Gold 2013 First Quarter Results Conference Call and Annual Meeting of Shareholders
TORONTO, ONTARIO--(Marketwired - April 18, 2013) - Centerra Gold Inc. (TSX:CG) will host a conference call and webcast of its 2013 first quarter financial and operating results at 11:00AM (Toronto time) on Thursday, May 9, 2013. The results are scheduled to be released after the market closes on Wednesday, May 8, 2013.
The Company will host its Annual Meeting of Shareholders on Friday, May 10, 2013 at 10:00AM (Toronto time).

North Asia Resources Annual Report 2012
April 18, North Asia Resources Holdings Limited (HKEx:61) --
Chairman's Statement
2012 has been an intense year for the Group given the insurmountable tasks that were accomplished and the phenomenal obstacles that were overcome in restructuring the corporate businesses of the Group.
Conditions in Mongolia have remained hard to predict and given the uncontrollable circumstances of recent political volatility and the logistics and operational issues, the Group had to re-strategize its operations in the country. The gold mining operation at the Khar Yamaat site and the iron ore mining operation at the Oyut Ovoo site have remained suspended for the interim.
The Group's diversification into coal trading and logistics in Mongolia has been more productive. Utilization rates for the fleet of heavy duty trucks have been improving and the logistics arm was able to operate effectively during the peak transportation period in 2012. However, this business still requires significant working capital before it can become a profitable venture.
Our banking and finance systems integration services business has maintained a steady performance this year. Sales and maintenance of self-service equipment devoted to the banking sector have generated positive returns. However, for this coming year, China's inflationary economy and the exceedingly competitive environment may prove to be an impeding factor for growth of the Group's banking business.
During the second half of 2012, a wholly-owned subsidiary of the Company entered into an acquisition agreement for the purchase of certain coal mines in Shanxi Province from City Bloom Limited ("City Bloom") for an aggregate consideration of HK$4,662 million.
Contemporaneous with the signing of the acquisition agreement, the Company also entered into a disposal agreement with Mountain Sky Resources (Mongolia) Limited ("MSM"), a connected party of the Company, for the disposal by the Company of its iron mining, coal trading, and logistics businesses at a consideration of HK$600 million. To facilitate the payment of consideration for the disposal agreement, MSM and City Bloom also entered into an agreement in relation to the sale of MSM's shares and convertible preference shares ("CPS") contemporaneously with the entering into of the acquisition agreement and the disposal agreement (the "Mountain Sky Agreement").
After a lengthy negotiation process, the Company also managed to reach an agreement with its convertible bond holder, Business Ally Investments Limited ("Business Ally"), to capitalize part of the USD30 million convertible bonds (the "USD30M CB") and to alter certain existing terms of the remaining convertible bonds. Business Ally has also given its conditional consent to the entering into of the agreements by the Company with City Bloom and MSM and that they would not constitute a breach of the existing terms of their convertible bonds.
On 18 December 2012, the Company entered into a placing agreement (the "Placing Agreement") with a placing agent, pursuant to which the placing agent has conditionally agreed to procure, on a best-effort basis, placees to subscribe for new convertible bonds at the conversion price of HK$0.31 per conversion share (the "New CBs") and promissory notes (the "PNs"), each up to an aggregate principal amount of USD30 million (the "Debt Placing").
The extended placing period ended on 31 January 2013 and our placing agent successfully procured 17 placees for the new CBs and the PNs. A significant subscriber is a wholly-owned subsidiary of a company listed on The Stock Exchange of Hong Kong Limited (the "Stock Exchange"). As the conditional subscription constitutes a very substantial acquisition for the subscriber, it is subject to the approval of the shareholders of its holding company. The subscriber is in the process of obtaining such approval.
The acquisition agreement, the disposal agreement, the new agreements with Business Ally, and the Mountain Sky Agreement are inter-conditional on each other (together, the "Proposed Transactions"), whereas the Placing Agreement is conditional upon the completion of the Proposed Transactions. We will work diligently and focus our efforts firmly on completing the Proposed Transactions. We hope to report positive news of the progress of the Proposed Transactions shortly.
The restructuring of the Group will allow us to shed lagging businesses and enter into a more stable and conducive environment. It will help the Group engender flexibility and resources to increase its revenue streams and also to strengthen its capital and asset base. We look forward to ushering the Group into a new frontier: to commence operating the new coal business in order to build a stronger and more valuable platform for our shareholders.
I would like to take this opportunity to thank the management and staff of the Group for their hard work, dedication, and loyalty under such uncertain environments. I would also like to thank all our shareholders and business partners for their trust and confidence in the Group's board and management.

ResCap hopeful for positive end to Mongolian stand-off
April 18 (Proactive Investors) Analysts at ResCap say they are increasingly optimistic that a deal will be struck to end a bitter stand-off between the government of Mongolia and Rio Tinto over the massive Oyu Tolgoi (OT) copper mine.
This could in turn offer "a significantly higher risk-reward scenario" to investors in the junior copper space, they concluded.
Investor sentiment towards Mongolia depends to a large extent on OT's success.
ResCap cites several positive indicators that "a win-win agreement will be struck for OT and that this event is scheduled to occur at a time when Presidential elections will conclude".
The election date was confirmed as 26 June last week.
"[This] will bring to a close a highly uncertain two year political cycle following Parliamentary elections and the subsequent change in government last year," they added.
If the mine gets up and running it will generate more than US$8bn every year for up to 50 years by producing 425,000 tonnes of copper and 460,000 ounces of gold a year.
OT is expected to contribute close to one third of the country's GDP in the medium term.
But the Government of Mongolia and the miner are locked in an argument over the implementation of the Oyu Tolgoi Investment Agreement.
Disputed issues range from project development and costs, to the operating budget, project financing, management fees and governance.
However, ResCap noted that "constructive progress is being made" regarding discussions with the Government of Mongolia ("GoM") according to Rio Tinto and Oyu Tolgoi LLC (as of this week), and that "bank funding in the form of project finance is now well advanced".
They also highlighted recent government approval for a proposed power plant at Erdenes Tavan Tolgoi, which would supply OT with all of its power needs.
On top of this they say pressure is on the government to do a deal after a leading ratings agency issued a warning on the country's soveriegn debt.
On 17 April, Standard & Poor's Ratings Services downgraded Mongolia's sovereign credit outlook to negative, stating "the likelihood of a sovereign downgrade for Mongolia within the next six to eighteen months has increased to more than one-in-three as the higher policy risk contributes to deterioration in the external and fiscal profiles" .
"[All these factors] have the potential to significantly improve investor sentiment and foreign direct investment into Mongolia in the second half of this year," ResCap said.
Local Market
16 April 2013, Tuesday (BDSec) – Sharp rise in coal miners shares boosted the MSE Top 20 on Tuesday. Baganuur (BAN), a thermal coal miner that produces 3.3 million tonnes of coal per annum, strengthened 4.76 percent to MNT 4,400 after gaining 5 percent yesterday.
Sharyn Gol (SHG), a coal producer located in the northern Mongolia, gained 4.75 percent to close at MNT 8,485.
Material Impex (MIE), jumped 10.0 percent to MNT 11,000, following 3.09 percent gain yesterday.
Mongol Savkhi (UYN) was the biggest loser of the day, losing 9.44 percent to MNT 1,161, followed by Telecom Mongolia (-5.88%), Genco Tour Bureau (-3.37%), and State Department Store (-1.77%)

17 April 2013, Wednesday (BDSec) – Almost two stocks rose for each that fell on the Mongolian Stock Exchange (MSE) on Wednesday. Total of 71 thousand shares worth of MNT 110.9 million (~USD 738.7 thousand) were traded on the exchange. MSE Top 20 edged up 0.09 percent to 15,000.70 points.
Mongol Savkhi (UYN), Bayangol Hotel (BNG), and Moninjbar (MIB) were largest gainers on the bourse, rising 14 percent.
Darkhan Nekhii (NEH), an animal skin processor located in Darkhan city, jumped 7.69 percent to MNT 7,000. Sor (SOR) and Gobi (GOV) advanced more than 2 percent today.
Telecom Mongolia (MCH), 55 percent state-owned telecommunication company, dipped 15 percent to close at MNT 1,360, while Eermel (EER) lost as much as 8.62 percent to MNT 2,650 and Tavantolgoi (TTL) dropped 4.17 percent to MNT 4,600.

18 April 2013, Thursday (BDSec) – The market retreated today after two consecutive days of trading in the green, even three stocks rose for every one that fell. The market pulled down by weakness in Tavantolgoi (TTL), which is the largest market-cap stock on the MSE. TTL lost as much as 13.85 percent today to close at MNT 3,963.
Moninjbar (MIB) once again advanced more than 14 percent to sit at MNT 327. Ulaanbaatar Hotel (ULN) jumped 14.69 percent today while Bayangol Hotel (BNG) gained 7.45 percent.
Local thermal coal miners performed well during the session with Sharyn Gol (SHG) up 9.41 percent, Aduunchuluun (ADL) up 5.93 percent, and Baganuur (BAN) up 2.27 percent.
Today MNT 110.8 million or USD 78.6 thousand worth of over 76 thousand shares of 32 companies traded on the MSE.

Mongolian bourse eyes boom in stock market listings
April 18 (Reuters) - The market capitalisation of companies listed on the Mongolian Stock Exchange (MSE) could leap more than 30-fold over the next three to five years, boosted by privatisations and new regulations, the chief executive of the bourse said on Thursday.
Mineral-rich Mongolia, a massive landlocked nation of fewer than 3 million people, has ambitions to become a destination for mining investment and has been working with the London Stock Exchange to modernise and develop its capital markets.
MSE Chief Executive Altai Khangai told a Mongolian Investment Summit in London that a new securities market law was expected to be passed in the next month which would lay out rules for new listings as well as enable dual listings.
He predicted the combined size of companies on the MSE could reach $45 billion in the next three to five years from about $1.3 billion currently, helped by the government's plans for privatisations as well as flotations by Mongolian firms seeking growth capital and dual listings from international companies.
Mongolia is on index provider FTSE's watch list for possible admission to Frontier Market status which would boost liquidity.
"We are also in discussions with FTSE about setting up a FTSE Mongolia series of indices," Khangai said.
Mongolia signed a partnership with the LSE in 2011, which included the provision of technology, advice and training.
Alastair Walmsley, Head of Primary Markets at the LSE, said significant progress had been made in developing the market.
"Much work remains to be done," he told the summit.
"The success in driving liquidity in the Mongolian market is going to depend both on the expansion of the Mongolian domestic investor base ... but also of course accessing the international investor community given the constraints on size of that domestic investor base."
A long-awaited three-way Hong Kong, London and Ulan Bator listing by Mongolian miner Erdenes Tavan Tolgoi has been put off for at least two to three years while the mine is developed, a deputy minister told Reuters earlier this week.
Walmsley said the LSE had also had discussions with some Mongolian companies which might look to raise capital on London's Alternative Investment Market for smaller companies.

Video: Mongolia Close to Allowing Dual Stock Listings
April 16 (Bloomberg) -- Altai Khangai, chief executive officer of the Mongolian Stock Exchange, talks about the country's economy and securities law. He speaks with Guy Johnson and Francine Lacqua on Bloomberg Television's "The Pulse." 
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Outlook On Mongolia Revised To Negative On Weaker External And Fiscal Profiles; 'BB-/B' Ratings Affirmed
<![if !supportLists]>·         <![endif]>The likelihood of a sovereign downgrade for Mongolia within the next six to 18 months has increased to more than one-in-three, in our view, as the higher policy risk contributes to deterioration in the external and fiscal profiles.
<![if !supportLists]>·         <![endif]>We are revising the rating outlook on Mongolia to negative from stable.
<![if !supportLists]>·         <![endif]>At the same time, we are affirming our 'BB-' long-term and 'B' short-term sovereign credit ratings on Mongolia.
<![if !supportLists]>·         <![endif]>The negative outlook reflects our view that Mongolia's fiscal and external profiles will weaken over the next one to two years.
SINGAPORE (Standard & Poor's) April 16, 2013--Standard & Poor's Ratings Services said today that it had revised its rating outlook on Mongolia to negative from stable. At the same time, we affirmed the 'BB-' long-term and 'B' short-term sovereign credit ratings on Mongolia. We also affirmed our 'BB-' issue rating on the country's senior unsecured notes. Our 'BB' transfer and convertibility (T&C) assessment on Mongolia is unchanged.
"We revised the outlook on Mongolia to negative to reflect our opinion that higher policy risk has increased the chances of a downgrade to more than one-in-three for the country over the next six to 18 months," said Standard & Poor's credit analyst Agost Benard. "Mongolia's fiscal and external profiles could deteriorate materially over the next year or two in the absence of a significant improvement in policymaking regarding government borrowing, public spending, and the business environment."
We may downgrade Mongolia if: (1) government borrowing increases substantially; (2) policy risk for the mining sector remains elevated and hurts foreign direct investment (FDI) inflow; or (3) exports remain weak.
On the other hand, we may revise the outlook to stable if the government significantly strengthens the management of its debt and investment, and the improvement in mining sector policy and practices enhances FDI inflow and mineral exports.
Mongolia's underdeveloped economy, with low GDP per capita, constrains the government's revenue base and its room to maneuver policy to support its creditworthiness in a downturn.
The mining sector has largely driven Mongolia's strong growth in recent years. It will account for an even larger share of the country's exports and fiscal revenue as the Oyu Tolgoi copper-gold mine becomes operational and other large mines increase production and exports.
The weak policy environment accentuates the sovereign's vulnerability stemming from its narrow economic profile. Frequent changes in the political landscape and the lack of a strong political leadership in recent years make it difficult for Mongolia to develop and implement a viable and consistent mining policy. This gives rise to significant policy risk for this sector, which is a pillar of the country's economy.
We expect Mongolia's external and fiscal risks to increase further over the next few years. This is largely because of our expectation that the government would resort to a greater use of debt to finance its ambitious development strategy. Although we expect mineral exports to grow fast, the positive impact of such growth on the current account would be largely offset over the next three years by imports associated with still sizable FDI inflow and the large bill for transportation charges on exports.
Mongolia's strong growth potential offsets some of the weaknesses in the sovereign's creditworthiness. The sovereign rating also benefits from the government's modest interest expense.

IMF cuts GDP forecasts for Mongolia but still expects rapid economic growth over next two years
April 17 (EPCRC) The International Monetary Fund (IMF) is forecasting the Mongolian economy to grow rapidly over the next two years but at a slightly lower rate than previously expected, the latest World Economic Outlook (WEO) released on Tuesday 16 April shows. GDP is now expected to grow by 14.0 per cent in 2013, revised down from the IMF's previous forecast of 15.7 per cent in October last year. Economic growth in 2014 is expected to be around 11.6 per cent, slightly lower than the 11.8 per cent previously forecast. But the growth forecast for 2015 has improved to 7.6 per cent, up from 4.8 per cent forecast in October (see Chart 1).
Chart 1: GDP growth forecasts for Mongolia expected to be 'smoother'
The forecasts for unemployment in Mongolia have remained unchanged. The unemployment rate is expected to be around 6 per cent in 2013, and is still expected to fall to 5.4 per cent in 2014. The IMF projects that unemployment will keep falling over the next four years as the Mongolian economy continues to expand and jobs are created. Inflation is expected to be a little lower than previously forecast, but will still be a problem for the Mongolian economy. The Consumer Price Index is forecast to grow by 11.1 per cent in 2013 (down from 11.6 per cent forecast in October), falling to around 9 per cent next year and 8 per cent in 2015 (see Chart 2). 
Chart 2: Inflation forecast to remain high but expected to steadily decline
The IMF reports that global economic conditions have improved during the past six months. The global economy is forecast to grow by 3.3 percent in 2013, with growth expected to pick up to 4 per cent in 2014. Advanced economy policymakers have successfully defused two of the biggest short-term risks to global activity: the threat of a euro area breakup and a sharp fiscal contraction in the United States. Financial markets have rallied in response, and financial stability has improved.
But Olivier Blanchard, the IMF's chief economist warns that, "We have moved from a two-speed recovery to a three-speed recovery". On the one hand, growth in developing and emerging economies will remain robust. For example China, Mongolia's biggest trading partner, is expected grow by 8.0 per cent in 2013 and 8.2 per cent in 2014. But in advanced economies there is a growing split between the performance of the United States and the euro area. Growth in the United States is forecast to be 1.9 percent in 2013 and 3.0 percent in 2014. In contrast, growth in the euro area is forecast to be –0.3 percent in 2013 and 1.1 percent in 2014.
The report underscores that policymakers cannot relax their efforts. In emerging market and developing economies such as Mongolia, the WEO highlights the need to tighten policies and rebuild fiscal buffers. The tightening should begin with monetary policy and, when needed, be supported with prudential measures to rein in budding excesses in financial sectors such as asset bubbles. Fiscal balances should also be restored. This will provide room for fiscal policy maneuvers should growth fall below trend in the future.
In advanced economies, the IMF argues that risks from high sovereign debt have generally limited the ability to implement expansionary fiscal policy. As such fiscal adjustment must progress gradually to limit damage to demand in the short term. Monetary policy must therefore remain supportive of private demand, while financial policies need to help improve the pass-through of monetary policy. The IMF notes that the United States and Japan have yet to design and implement comprehensive medium-term deficit-reduction plans. It warns this is an urgent requirement for Japan, given the significant risks from renewed fiscal stimulus combined with very high public debt levels. In the euro area economies, structural reforms to rebuild competitiveness and boost medium-term growth prospects are critical, as is further progress on architecture reforms to complete the economic union.
For full details, please visit the IMF's World Economic Outlook April 2013 report at: For the data used in this summary, please visit the World Economic Outlook Database April 2013.
Summarised by Nick Plummer, Economic Research Officer (, Economic Policy and Competitiveness Research Centre, Ulaanbaatar, Mongolia

BoM holds FX auction
April 18 (Bank of Mongolia) On the Foreign Exchange Auction held on April 18th, 2013 the BOM received from local commercial banks bid and ask offers of USD and CNY. BOM has sold 40 million USD as closing rate of 1418.10 and has refused for bid offer of CNY.
On April 18th, 2013, The BOM received MNT Swap agreement bid offer of 95 million from domestic commercial banks and BOM has accepted all the offers for swap agreement.

BoM issues 1-week bills
April 19 (Bank of Mongolia) BoM issues 1 week bills worth MNT 54 billion at a weighted interest rate of 11.50 percent per annum /For previous auctions click here/

BoM Monthly Statistical Bulletin, February 2013
April 19 (Bank of Mongolia) --

Video: Mongolia Needs to Invest in Infrastructure to Improve Mining Competitiveness
April 19 (Bloomberg) -- Mongolia's Central Bank Governor Naidansuren Zoljargal and Randolph Koppa, president of the Trade & Development Bank of Mongolia LLC, discuss the country's economy, competitiveness and direct foreign investment. They speak with Francine Lacqua on Bloomberg Television's "On the Move."

Frontier Securities: Updates on Mongolian Banking Industry
April 20 (Frontier Securities) At its meetings on the 3rd and 5th of April 2013, the Monetary Policy Committee (MPC) of the Bank of Mongolia decided to cut the policy interest rate by 1.0 percentage point to 11.5 percent for the purpose of increasing domestic credits and investments, supporting the real sector and stimulating business activities.
Expected low impact of the government budget on inflation, decline in demand-pull and supply driven inflationary pressure, and annual inflation outlook in upcoming months to be consistent with the targeted level have enabled to reduce the policy interest rate.
The MPC obviously has made the decision concerning prolonged uncertainties in foreign investment environment and foreign trade.
Now that the BOM has been taking measures to stimulate economy, some investors are starting to worry about healthiness of financial system and some major banks.
This report is to answer some of the questions below.
<![if !supportLists]>1.    <![endif]>What are the policies taken by BOM to achieve "Growth" of the economy?
<![if !supportLists]>2.    <![endif]>Are Mongolian banks still healthy? (Highlights of financial statements of major banks as of end of 2012)
<![if !supportLists]>3.    <![endif]>How much will be the current valuation of Mongolian banks? Will it be possible for them to do IPO in foreign stock exchanges?
Please see here to read full story.

Parrado's guide for Mongolia to building sovereign wealth funds
April 17 ( They may be on opposite sides of the Earth, but Chile in Latin America and Central Asia's sparsely populated Mongolia share more than a few similarities. Both boast some of the biggest copper deposits in the world and now Mongolia has turned to Chile for advice on how best to steward income from its forecast bounty that stretches out beneath the Gobi desert. It is sourcing help from one of the architect's of Chile's rocketing $22.9-billion sovereign fund. Eric Parrado, former international financial coordinator at Chile's ministry of finance and now advising other emerging economies on the steps to managing resource wealth, has become synonymous with Chile's global reputation on wealth fund expertise. "At the beginning in Chile nobody thought there was any point in saving money because we were an emerging market economy. Chile needed to spend money, so why save it?" says Parrado, just back from the Mongolian capital Ulan Bator. "But by saving in the good times, we were able to spend in the crisis and now all our critics applaud us."
A guide for novice sovereign savers
His advice to Mongolia starts with tight fiscal management. Mongolia passed a new fiscal stability law in 2011, the foundation, says Parrado, on which any successful sovereign wealth fund must stand and the key to establishing discipline in commodity-driven economies prone to boom and bust. In a next step, Mongolia is drawing up a bill to create a framework for several sovereign funds, which will likely take on similar lines to Chile's Pension Reserve Fund, established in 2006, and the Economic and Social Stabilisation Fund (ESSF), set up in 2007. The concept behind any stabilisation, or rainy-day fund, is to keep investment strategy liquid and conservative so financial help is close to hand in times of economic crisis. A pension reserve fund would cover future state pension liabilities and Mongolia is also considering a future generations fund, through which returns, but not capital, could be used to invest domestically. "Mongolia has only just begun discussions and there is no money to invest as yet, but it is likely assets will be split between these types of funds," he says.
In his guide for novice sovereign savers, Parrado counsels that assets be allocated to safe and liquid allocations overseas to avoid Dutch disease, so-called after The Netherlands economy slumped following discoveries of natural gas in the North Sea in the 1960s. Investment strategy for countries without any experience of "formal strategies" should mirror the same asset allocation as their central banks use to manage international reserves. "This is what we did in Chile," he says. It meant that in the embryonic years of Chile's sovereign fund, assets were split between a 70-per-cent allocation to US, European and Japanese sovereign debt and a 30-per-cent allocation to money market instruments. "It was plain vanilla but it was very good," says Parrado. "Between 2007 and 2010 Chile had some of the best returns in the sovereign wealth fund world because we chose safe assets." He doesn't advise rejigging allocations in the early stages of a fund's life, drawing on the experiences of seasoned sovereign saver Norway during the financial crisis as an example of the merits of leaving investment strategy well alone. "Take the case of Norway," he says, referring to Norway's $650-billion Government Pension Fund Global. "In 2008 they decided to boost their equity allocation to 60 per cent. Equities were falling yet they had to buy more equities to reach the 60-per-cent mark. They lost $100 billion in 2008. It was really crazy and there is no way Chile could have done this."
Benchmarks rather than indices
Only after what he calls "an essential learning process" did Chile begin to think about diversifying to other asset classes to manage risk. Assets were split to encompass equities and corporate bonds in passive, global strategies. "An active strategy isn't worth it because it's too difficult to gain against the market. There shouldn't be any cherry picking, but following benchmarks rather than investing in indices." Since Chile's central bank had no specific experience of managing these riskier allocations, it used external managers for its equity and corporate bond portfolio. "One hundred and 10 external managers were invited to the ministry of finance," he recalls. "Because it was 2008 and the middle of the crisis, we postponed allocation until 2012, awarding the biggest to Blackrock, Bank of New York Mellon, and Rogge. We have benchmarks and tracking errors for each one in passive strategies."
Parrado acknowledges that saving is a hard sell in developing countries in need of investment in infrastructure, schools and health, but warns that Mongolia, one of the poorest countries in Asia, should only draw on sovereign reserves if they are channelled through the budget. It's a strategy Norway leads on, with the government spending just 4 per cent of its sovereign fund's annual return. It rules out strategic investment such as equity stakes in local companies, something Singapore's sovereign fund GIC favours, but it ensures against downside risk. "Investing in local companies could work, but in my view, emerging market economies should only use the fund as a financing mechanism and shouldn't invest directly in this way. It would involve careful allocation of money and an awareness of what type of investment was actually needed to ensure there weren't white elephants everywhere."
Risk rather than return
Nor does he suggest new funds target returns. Instead they should focus on risk, a strategy he believes is key to "preserving capital and legitimising the savings process" in poor countries. "All funds should begin from the point of expected risks rather than expected returns." His advice to Mongolia is also to avoid some sectors of the economy to reduce risk further. In Chile managers are asked to not invest in Chilean copper companies because the risk correlation is too high in terms of economic activity.
In an era when sovereign wealth funds have become "flavour of the month", Parrado doesn't recommend any flamboyant asset diversification or that countries fashion strategic funds targeting local development. He espouses rigorous institutions and frameworks and cautions strategies in a model that now speaks for itself. "Of course there are different strategies and it is entirely dependent on what a government wants to do," he says. "But from Chile's experience in starting a fund from scratch in an economy that is close to other emerging market economies, this is the strategy we recommend."
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Foreign investors welcome Mongolia's change of tack
April 19 (Terrence Edwards, bne) Mongolia's parliament Friday, April 19 passed an amendment to its controversial foreign investment law of last year, which should allow over 100 pending investment deals in the country to now progress.
The Strategic Entities Foreign Investment Law (SEFIL) was rushed through parliament in May 2012 as protests grew about the increasing foreign (read: Chinese) control over the country's vast mineral wealth. But the wide-ranging nature of the law caused investment to fall through the floor as international investors felt the law was designed to deter all foreign participation in the economy.
The new amendment to SEFIL exempts private sector foreign companies from the full scope of the law, which demands government approval for the purchase of any stake in a Mongolian company operating in the mining, banking and finance, communications and media sectors in Mongolia.
At the same time, the amendment tightens restrictions on foreign state-owned entities (SOEs) investing in Mongolian firms, by removing a 100-billion tugrik ($71m) threshold triggering government intervention. Thus, all SOE investment is now subject to government approval, and for acquisitions by SOEs of stakes above 49%, parliamentary approval will also be required.
Tightening control of SOE investment is a sop to hardline resource nationalists, who began the push for SEFIL following last year's $926m bid from state-owned Aluminum Corporation of China Ltd. (Chalco) for a majority stake in coalminer SouthGobi Resources. Many Mongolians saw the bid as part of a worrying trend of seeing its resources sold off to its giant southern neighbour, with whom it has a tricky historical relationship.
The wide-ranging nature and stiff penalties of SEFIL – companies found in violation of the law could even have their permission to operate revoke – ended up scaring off much foreign investment. According to the local brokerage Mongolia International Capital Corporation, the country saw its lowest monthly inflow of foreign investment since at least 2010 in February with $81m, while foreign investment in 2012 fell 17% to $3.9bn.
"I think this is the first step in Mongolia's recognition of how the law impacted private companies from completing transactions and how it has driven down investment," says Chris MacDougall, managing director of Mongolian Investment Banking Group. "Now we can expect transactions on hold since SEFIL to be completed."
Grey areas
Some analysts caution that the law still fails to clarify key details. Although the amendment just passed by parliament has not yet been released in full, law firm Hogan Lovells told clients in a note that the scope of what is known about the amendments are "narrow" and need further work.
"The proposed amendment has not provided sufficient clarification for the law's vagueness," says Michael Aldrich of law firm Hogan Lovells. "In addition, the official wording of the amendment has not yet been disclosed so we do not have a clear view on the precise nature of the changes. At this juncture, it looks like some officials might be overselling the idea of a liberalisation."
From what Hogan Lovells knows about the amendment, key terms have been left vague: the mining sector could include mining service companies that assist the operators at mines and even oil extraction; there is also no mention of how pension funds and sovereign funds factor into the law; nor is there even a complete definition of a state-owned entity.
However, the law will likely be enough to allow deals involving private firms to move forward, such as an agreement by Teck Resources, a large Canadian miner, to join up with Erdene Resource Development Corporation as a partner in its mineral exploration in Mongolia. Erdene said the deal hinged specifically on clarifications to SEFIL.
Chimed Saikhanbileg, the government's cabinet secretary, told parliament that the Ministry of Economic Development is already in the process of drawing up a new law to replace SEFIL and resolve these remaining questions. The government hopes to bring greater certainty to investors that Mongolia is a home for long-term investment, he said.
Mongolia's opposition party, the Mongolian People Party (MPP), has also declared its intention to draft a competing law. The MPP, which has been the ruling party for most of Mongolia's history as a democracy, is eager to reclaim power and will likely use the law as a point of debate while highlighting perceived failures of the current ruling government. The opposition party has called for the resignation of Prime Minister Norov Altankhuyag of the government-leading Democratic Party, holding him responsible for the falling foreign investment.

Mongolia's Parliament Approves Changes to Foreign Investment Law
April 19 (Bloomberg) Mongolia's parliament approved an amendment to its foreign investment law, easing some restrictions on overseas private companies while maintaining controls on state-owned groups, after a slump in investments.
The changes remove the need for parliament to review investments by non-state owned companies, said Sereeter Javkhlanbaatar, director of foreign investment at the Ministry of Economic Development, by phone from Ulaanbaatar. Deals involving state-owned companies or companies with government equity will still need to be reviewed if the investment is more than 49 percent.
The amendments may help to boost investor confidence following protracted disputes with key Mongolian investors, including Rio Tinto Group. Foreign direct investment in Mongolia declined 17 percent last year and is down 58 percent in the first two months of this year.
"The amendments are welcome but the damage has been done, and many investors' appetites have moved on to more stable jurisdictions," James Liotta a partner at Mahoney Liotta LLC in Ulaanbaatar, said by e-mail. "Those who are locked in are likely to take a much more conservative approach toward investing in Mongolia."
The law applies to companies in the strategic sectors of mining, banking and media, Chimed Saikhanbileg, the government's cabinet secretary, said by phone from Ulaanbaatar. Today's changes only apply to parliamentary reviews for state owned foreign companies and don't remove the need for both state and private companies in those sectors to get approval from the government, the prime minister and his cabinet, for investments, he said.

Mongolia Introducing New Investment Law to Attract Investors-Deputy Minister
April 17 (WSJ) The Mongolian government plans to submit a new investment law for parliamentary approval by this summer that aims to give foreign investors more assurance about the rules governing their investments, Mongolia's deputy minister of economic development said Wednesday.
"We want to send a very strong message [regarding] the stability and in the clarity of treatment of foreign investors in Mongolia," Chuluunbat Ochirbat told journalists on the sidelines of the Mongolia Investor Summit here.
He said the government has already drafted the law and plans to hold a cabinet-level discussion over the next couple of weeks with a view to submitting it to parliament for approval before the spring plenary session closes on July 10.
The draft law aims to reverse the recent downturn in foreign direct investment after stricter controls were applied last year.
"In the last year, Mongolia approved in a very rash move [a foreign direct investment that]...has affected very badly the economic situation," he said. The government is trying to reverse that trend.
He said the draft law will allow private investment of any size without parliamentary approval although investment coming from state-owned enterprises will still require parliamentary approval.
He said the law aims to provide assurance investments made under today's regulation won't be arbitrarily changed over a certain period. In other words depending on the size of the investment, the government will provide assurances over five, 10, or 20 years the regulation governing their investment won't change due to future law amendments, he said.
Ochirbat added the new law will aim to ensure future investments won't be dictated by bilateral agreements, as was the case in its 2009 agreement with Rio Tinto PLC and Turquoise Hill Resources Ltd. That benchmark agreement formed the basis for the investment of billions of dollars in Mongolia's massive Oyu Tolgoi copper and gold project and spurred a boom in other mineral resource projects. Ochirbat said the new law aims to ensure future investment will be governed by national laws rather than investment agreements.
Separately, Ochirbat said the draft mineral law introduced by Mongolia's President last year will be withdrawn from debate following public division about the details of the proposed mineral law.

Mining Minister: International Investors Have Agreed to Cease Negative PR
April 18 ( State great khural is taking place today in the parliament house. MP Mr. Otgonbayar asked the Mining Minister regarding the negative economic outlook and ratings of the country from rating agencies. The Mining Minister stated that international investors agreed to stop spreading and feeding negative news and messages through its' associated PR companies and media channels.
The Economic Development Minister Mr. Batbayar added that the ratings have flaws. Governments in developed countries also questioned the validity of the ratings by the major agencies after the 2008 financial crisis. He mentioned that these updated ratings that rated Mongolia as negative BB-, is questionable, especially at the time when the PM's resignation is under discussion.
S&P revised Mongolia sovereign credit outlook down to negative from stable; current rating is BB-.

Bayartsogt explains ICIJ offshore releases to parliament
April 18 ( Today, in the SGK session regarding the resignation of deputy speaker, Mr. Bayartsogt S. himself made explanations.
He assures that all of the records and transactions were submitted to IAAC (Independent Agency Against Corruption) and proved that there were only 2 transactions. Initial deposit was made when the account was opened – 1 million USD. Then the fund was withdrawn leaving only 1600 EUR. He also says that the ICIJ director wrote him a letter wishing him good luck on this difficult times.
The issue regarding the record of his address adding "China" after Mongolia in the official company documents weren't his mistake, it was the recording company's typo, and Mr. Bayartsogt S. asked the company to issue an apology letter publicly, he states.
Some MPs stated that Mr.Bayartsogt not only has to resign from his deputy speaker position, also from the parliament. After this statement, the Minister of Justice Mr. Temuujin stated that there aren't any clause to revoke his seat in the parliament.
Mr. Bayartsogt assures that he will answer all the questions from MPs, and set a good example. He stated that he only didn't declare the name of the company name. His profit and income were all declared in the IAAC report.
MP Mr. Baasankhuu asked him to reveal the names of the business-partners that contributed 800,000 USD to his offshore account. Mr. Bayartsogt declined to reveal the names, stating that he gave the names to the IAAC.
MP Mr.Nomtoibayar says, he doesn't believe ICIJ investigative journalists would have technical and professional ability to retrieve these information. He believes that this issue should be investigated and security of MPs should come in question.
He denied that the account had any connections with Oyu Tolgoi deal. Mr. Bayartsogt added that his contribution to the deal and amendments in the draft agreement was had a positive economic benefit to Mongolia.
MP Mr.Batzandan added that Mr. Bayartsogt has never been a good example, and never should have been a deputy speaker. He emphasized that his peers in the Democratic Party asked the members to support Mr. Bayartsogt in the session. Despite this, he said people like Mr. Bayartsogt who acts against the interest of Mongolia, and hides illegal and secret profit overseas should be out of SGK. Mr. Bayartsogt responded that he didn't violate any laws both internationally and domestically.
Mr. Bayartsogt stated that he didn't independently negotiated the Oyu Tolgoi deal. Agreement was discussed in SGK, and Mongolia had one position, then it was signed, he says. He stated that scrutiny around Oyu Tolgoi will always be there.
MP Mr.Bolorchuluun added that the Oyu Tolgoi agreement is the worst agreement he has ever seen in his 20-year business career favoring foreign companies in taxation.
MP Mrs. Uyanga stated that the people of the country is watching closely how Democratic Party will treat the misconduct of its' own member, and its' fairness. Also, she says that if he doesn't give up his parliamentary seat, resignation as a deputy speaker is not sufficient as a disciplinary act.
Previously we covered related news here and here.

Newly elected MP receives certification
April 17 ( Today the 26th Electoral District presented a parliamentarian certificate to DP candidate Dolgorsuren Sumiyabazar who won 54 percent of the vote in the re-polling for the parliamentary election.
The 26th Electoral District will announce the final results of the revote for the parliamentary election to the General Election Committee. The General Election Committee will then ask Parliament and the President to accept Dolgorsuren Sumiyabazar as an MP and to take the oath as a parliamentarian. The State Great Khural or Parliament of Mongolia will have 75 members when the newly elected parliamentarian takes their oath. 
MPP, the opposition party will have 26 seats in parliament. MPP candidate, Dolgorsuren Sumiyabazar won over the DP candidate Lombo Erkhembayar with 54 percent of the vote in the revote for the parliamentary election last Sunday according to the preliminary result. The General Election Committee has not yet declared the final results, but DP candidate Lombo Erkhembayar has already accepted his loss in the election.

PM Resignation Demand Fails to Pass Standing Committee
April 18 ( The plenary session meeting of Parliament is being held in Government House. 
The main issue to be discussed is expected to be the demand for the resignation of Prime Minister Norov Altankhuyag
The demand for the resignation of the Prime Minister was submitted by MPs of the MPP caucus in Parliament. It was rejected during a Standing Committee meeting on State Structure last Tuesday
The Standing Committee on State Structure introduced the suggestions and summaries made in the meeting to MPs during the plenary session meeting and MPs asked questions and clarified the information.
Many of the MPs of the MPP caucus in Parliament questioned and criticized the Prime Minister. 
MP D.Oyunkhorol said that the "Prime Minister only talks and answers on behalf of DP instead of teaming with MPP. Even though he is a member of the National Security Council, he speaks careless."
There are also MPs of the DP in Parliament who might support the demanded resignation of the Prime Minister. 
MP G.Bayarsaikhan said that "the demand for the Prime Minister to resign is groundless. But the reformist government promised a number of reconstruction projects since it was formed. Now the Government has to start these reconstruction works. If it does not make a prompt start to projects as soon as possible in early spring, DP members are also likely to demand his resignation." 
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Mongolia's Tavan Tolgoi to Resume Coal Exports to China
April 19 (Bloomberg) Erdenes Tavan Tolgoi LLC, Mongolia's largest state-owned coal company, will resume shipments to China next week, ending a three month stand-off with its biggest customer, Mongolia's Prime Minister Norovyn Altankhuyag said.
The breakthrough follows negotiations with its main customer, Aluminum Corp. of China Ltd., or Chalco, according to a government press statement on the prime minister's comments in parliament today.
Exports to Chalco, China's biggest producer of aluminum, stopped on Jan. 11 due to a lack of funds required to pay Altangovi, which provides warehousing services at the border with China. The chief executive officer of Erdenes TT, Yaichil Batsuuri, said his company had run into financial trouble and wanted to raise prices and cut shipments, changing the terms of the $250 million contract it signed in July 2011.
"The prime minister said Mongolia will begin shipments of coal from next week," according to the press statement. They will include 337,000 metric tons of coal held at the border and 1 million tons at the Tavan Tolgoi coal field, Mongolia's largest.
Erdenes TT is one of three companies operating at Tavan Tolgoi, which contains 6.4 billion tons of reserves. The company declined to comment on details of its negotiations with Chalco.
Mongolia has informed the company that the nation is resuming coal exports to China, Cheng Zhiqiang, Chalco's deputy general manager of international trade, said by phone. He declined to comment on whether any terms of the supply contract with Erdenes TT had changed.

Australia beats Mongolia in coking coal exports to China
April 18 (UB Post) The latest monthly statistics released by the Chinese Customs Office indicate that in February Australia surpassed Mongolia's coking coal exports to China.
China, the world's biggest consumer of coal, imported 5.4 million tons in February 2013, an increase of around 116 percent from the same period in 2012.
In 2012 Mongolia was the top supplier of coking coal to China, with Australia trailing far behind. But by February this year, Australia was exporting more coking coal to China than Mongolia.
Australia's coking coal exports to China reached 2.58 million tons in February 2013. Canada ranked next with 1.21 million tons of coal exports to China, followed by Russia with 527,300 tons, and the United States with 408,700 tons.
Mongolia's exports to China dropped to 336,000 tons in February 2013, a decrease of 76 percent from January, and 80.7 percent lower than for the corresponding period of 2012.
The drop in Mongolia's coal exports is largely due to the halt in shipments to China earlier this year of coal from Mongolia's largest coal mine, Tavan Tolgoi, which is operated by state-owned Erdenes Tavan Tolgoi. The halt in shipments was reportedly due to financial troubles experienced by the company.
In December, the Mongolian government agreed to provide Erdenes Tavan Tolgoi with a loan of 200 million USD. Chief Executive Officer of Erdenes Tavan Tolgoi, Ya.Batsuuri, informed the media that the government had since decided to increase that amount to 355 million USD.
The company originally planned to release an Initial Public Offering (IPO) on international stock exchanges, but the release was delayed due to worries that the recent difficulties might hinder the price of shares. Mining minister D.Gankhuyag said in a recent government briefing that the IPO will be released before 2015.

Chinese, Mongolian experts discuss prospects for coal cooperation
ULAN BATOR, April 21 (Xinhua) -- A four-day seminar which ended here Sunday explored the prospects for closer cooperation between Mongolia and China in the coal industry.
The China-Mongolian Coal Cooperation Seminar, jointly run by the National University of Mongolia's School of Foreign Service and the University of Inner Mongolia of China, brought together experts and scholars, government officials and business representatives from the two countries.
Participants analysed problems encountered in cooperation in the development of coal fields and looked at ways to expand joint work in the sector.
According to Mongolian experts, the country's geological coal reserves are about 173.3 billion tons. There are more than 300 coal mines in 15 regions, ranking Mongolia in the world's top 10 coal producers.
In 2012, Mongolia produced 31.1 million tons, exported 20.5 million tons, and provided 828.5 billion tugrug (600 million U.S. dollars) in state revenue.

AREVA discovers big uranium deposit in Mongolia
April 17 ( French nuclear giant AREVA (EPA:AREVA) recently revealed information (Mogi: this link doesn't lead to a press release, nor is does a search in Areva's website) about a new uranium discovery in Mongolia.
AREVA Mongol, its Mongolian subsidiary, reported 50,000 tonnes of uranium in inferred resources with a grade of 0.01% as a result of ongoing exploration efforts at the Zoovch Ovoo project.
The project is located in Ulaanbadrah Soum, in the southeastern Dornogobi province of Mongolia.
Uranium mineralization is characterized as roll-front type and potentially amenable for the most effective lowest-cost in-situ leaching (ISL, a.k.a in-situ recovery) mining method.
Thus, by the volume of uranium resources in-situ, the Zoovch Ovoo project is comparable to the biggest deposits of that type in Kazakhstan.
This is not the only Mongolian exploration success for AREVA in recent years.
Two years ago, the company announced the discovery of the Dulaan Uul deposit with 9,888 tonnes of uranium, following field tests which confirmed the ISL mining method as preferable.
AREVA Mongol has 28 exploration licenses covering more than 14,100 square kilometres in the East Gobi province of Mongolia. This huge sedimentary basin contains promising uranium deposits well-suited to ISL mining technology.
At this time, AREVA is investigating the feasibility of the Dulaan Uul uranium deposit .
Mongolia has all the prerequisites to become a large uranium producer in the foreseeable future.
At the same time, political and mining law uncertainties greatly hinder development of uranium projects in country.

Government of Mongolia and Genie Energy Sign Strategic Oil Shale Development Agreement
NEWARK, N.J., April 19--(BUSINESS WIRE)--Genie Energy (NYSE: GNE, GNEPRA) said today that its subsidiary, Genie Oil Shale Mongolia, LLC (Genie Mongolia), and the Petroleum Authority of Mongolia (PAM) have entered into an exclusive oil shale development agreement to explore and evaluate the commercial potential of oil shale resources on a 34,470 km2area in Central Mongolia.
The five year agreement calls for Genie Mongolia to explore, identify and characterize the oil shale resource in the exclusive survey area and to conduct a pilot test using in-situ technology on appropriate oil shale deposits. Genie may seek to proceed to commercial development via a production sharing agreement in accordance with Mongolian law. To date, Genie Energy is the only recipient of an exclusive oil shale survey contract in Mongolia.
"We started evaluating Mongolia's oil shale deposits after signing a joint survey agreement in 2012, and are very pleased to continue that work under this new agreement. Our geological team has located a world-class resource and will now identify the most advantageous areas for future commercial development," said Claude Pupkin, CEO of Genie Energy.
O. Erdenebulgan, Mongolia's Vice Minister of Mining, said, "Utilizing Mongolia's extensive oil shale reserves to reduce our dependence on imported oil is a strategic priority for the Government. We have been impressed by Genie's commitment to Mongolia. They have the appropriate technical expertise to produce oil and gas from oil shale in an environmentally sensitive manner. We look forward to continuing to work with their team."
Michael Jonas, Executive Vice President of Genie Oil & Gas, added, "We share the PAM's goal of reducing Mongolia's dependence on energy imports and developing an export industry that can meet the growing regional demand. Genie Mongolia looks forward to working with the PAM to successfully develop Mongolia's abundant oil shale resources and achieve these goals."
About Genie Oil Shale Mongolia, LLC.:
Genie Oil Shale Mongolia, LLC, (GOSM) is an unconventional oil and gas exploration company operating in Mongolia. GOSM is owned by Genie Oil and Gas, a subsidiary of Genie Energy Ltd. (NYSE: GNE, GNEPRA).
About Genie Energy, Ltd.:
Genie Energy Ltd. (NYSE: GNE, GNEPRA) is comprised of IDT Energy and Genie Oil and Gas (GOGAS). IDT Energy is a retail energy provider (REP) supplying electricity and natural gas to residential and small business customers in the Northeastern United States. GOGAS is a resource and technology development company, focused on producing clean and affordable transportation fuels from the world's abundant kerogen-based oil shales and other hydrocarbon resources. GOGAS resource development projects include oil shale and oil & gas initiatives in Colorado, Israel and Mongolia. For more information, visit

April 18 (Montsame via BDSec) A work started April 17 to implement a 33 billion togrog worth plan on improving a Zamyn-Uud (Mongolia)--Ereen (China) passing capacity. This work is reflected in the "Border checkpoints renovation" program of Mongolia's government for reforms.
The work is to be financed by the Mongolian side and executed by a Chinese company, as stipulated in an contract.
A road of 2.3 km will be run from the border point for heavy duty trucks to the Customs control before June 15, and a road of 8.7 km going to the railway shipping square--before October 15 this year.
Present at the opening ceremony were a plenipotentiary representative of the Government D.Bekhbat, a head of the Customs General Authority of Mongolia O.Ganbat, a governor of Dornogobi aimag P.Gankhuyag, also Bao Chongming, a Mayor of Ereen and others.

Erdenet formerly appoints Davaatseren as General Director at Board Meeting
April 19 ( The Mongolian-Russian Erdenet Mining Corporation started a Board session on Thursday April 18th to discuss several issues. 
During the Board meeting Erdenet Mining Corporation made a decision to appoint the current acting director Ts.Davaatseren as the Director General of Erdenet Mining Corporation. Ts.Davaatseren was appointed to the post as acting director of Erdenet Mining Corporation in February.
The Board meeting, where representatives of the directors of Rostechnology Company that holds Mongolian-Russian JVCs in Mongolia where present, will continue from April 18th to April 20th. 
During the Board meeting MonRostsvetmet and other JVCs in Mongolia will be discussed.

April 19 (InfoMongolia) MIAT Mongolian Airlines addressed the Authority for Fair Competition and Consumer Protection of Mongolia that Mongolian Airlines Group LLC has been breaching the Consumer Protection Law of Mongolia on the grounds that the company uses similar name referred as "Mongolian Airlines".
Moreover, on their aircrafts Mongolian Airlines Group LLC that was established in 2011 uses letters "Since 1956" that advertises their activity as established in 1956, besides makes some confusion not only among domestic customers, but also foreign airline partners.
After consideration, the Authority for Fair Competition and Consumer Protection requested Mongolian Airlines Group LLC to change its name and remove "Since 1956" letters on their aircrafts immediately.
Accordingly, the Group accepted the requests and from now on will be continuing their activity under new carrier name "Khunnu Airlines", they announced its decision on April 18, 2013.

Gas Stations Seized After Failure to Pay Fair Competition Fines
April 18 ( According to a decision made by both the primary and appeal court, the Authority for Fair Competition and Consumer Protection (AFCCP) imposed a 17 billion MNT fine to petrol importer companies. Therefore the Capital City Court Decision Enforcement Department has taken action to collect the owed fines. Petrol importer companies M-Oil, Oinbirj and MagnaiTrade so far have paid some of the fines. 
The Authority for Fair Competition and Consumers Rights imposed the 17 billion MNT fine for the fuel importers` illegal actions of increasing fuel prices up by 230 MNT last January. It was revealed that domestic petrol importers were working together to increase fuel prices without grounds to do so. 
For the enforcement efforts the Capital City Court Enforcement Department sealed six gas stations and restricted 19 vehicles in traffic of the petrol importer company, Shunkhlai LLC. A vehicle of Petrojump LLC was seized and four properties, three gas stations and a 12 story office building of MagnaiTrade LLC in Khan-Uul and Sukhbaatar District were detained. Also 30 vehicles belonging to the company were restricted. 
The Capital City Court Enforcement Department also apprehended 5500 square meters of land owned by M-Oil in Bayanzurkh District and Lexus-470 and 570 vehicles as well as temporarily cancelling the sale rights of four gas stations belonging to Oinbirj LLC in Sukhbaatar, Bayanzurkh and Nalaikh District from March 1st. 

Nongshim Sees Booming Sales in Mongolia
April 18 (The Chosunilbo) Food manufacturer Nongshim has grabbed a 40 percent share of the instant noodle market in Mongolia
The company on Wednesday said it sold US$7 million worth of instant noodles there last year to account for a 40.5 percent market share. It started selling the instant noodles in Mongolia in 2002 and has ranked at the top in terms of sales since 2007. 
It sold $440 million worth of instant noodles in 82 countries last year.
Nongshim is the top-selling instant noodle brand in Korea and Mongolia and ranks third in the U.S. with a 12 percent market share. "The popularity of our instant noodles spread by word of mouth from Mongolians who used to work in Korea, and the Korean Wave also helped boost sales," a Nongshim staffer said.

Sentence remitted for former chairman of Mineral Resources Authority
April 16 ( The Capital City Court revised the case against D. Batkhuyag, the former chairman of the Mineral Resources Authority and four other offenders, The Capital City Court changed the Primary court decision in the courtroom of detention center 461 of the Court Decision Enforcement General Office on Monday April 15th. 
The Court sentenced the former chairman of the Mineral Resources Authority, D.Batkhuyag and T.Davaatsogt each to a four year jail term and Jargalsaikan and Bat-Ireedui each to 3.6 years. 
The Court reassured the Primary court decision to cancel the 106 illegal mining licenses issued by D.Batkhuyag through power abuse. 
During the three day trail in January, the Primary Court had sentenced 6.6 years to the former chairman of the Mineral Resources Authority, D.Batkhuyag and 6 years to  N.Davaatsogt, the former Head of the Office for Geological and Mining Cadastre of the Mineral Resources Authority. Batkhuyag`s friends, Jargalsaikhan and Batireedui, Directors of Zelem LLC, had been sentenced to 5.1 years by the Primary Court.

Video: Harnessing Wind to Bring Warmth, Light to Mongolia
April 16 (Bloomberg) -- Bloomberg News looks into Mongolia's new wind farms. 

Best Western in Ulaanbaatar: Gobi's Kelso
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Ambassador to the US from Mongolia: Who Is Bulgaa Altangerel?
April 20 (AllGov) The remote central Asian nation of Mongolia—sandwiched between big powers Russia and China—appointed a new ambassador to the U.S. in December 2012. Dr. Bulgaa Altangerel presented his credentials to President Obama on January 14, 2013, succeeding Bekhbat Khasbazar, who had served since April 2008. 
Born October 25, 1955, in Khovd Province, Mongolia, Altangerel was handpicked at an early age by the Mongolian Foreign Ministry to receive a university education and eventually work for it. He earned a Master's degree in International Law at the Moscow Institute of International Relations in 1979, a Master's degree in Political Science at the Moscow Institute of Political Science in 1990, and a PhD in International Law at Ukraine's Kiev National Taras Shevchenko University in 2003. 
In 1992, he was a visiting fellow for International Law and International Public Affairs at Columbia University, and from 1993 to 1997 he served as chair of the International Law Department at the Mongolian National University. 
Upon joining the Mongolian Ministry of Foreign Affairs in 1979, Altangerel had two years of desk work before taking a four-year stint at the Mongolian embassy in Kabul, Afghanistan, from 1981 to 1985, which were some of the worst years of fighting between the Soviet-backed government of Babrak Karmal and the U.S.-backed rebels who eventually won and established the Taliban regime. 
Altangerel served the next twelve years based in Ulan Bator, first at the Foreign Ministry as a member of the Inter-Governmental Commission on the inspection of state boundaries between Mongolia and the USSR from 1985 to 1988, then as foreign policy advisor to the Parliament of Mongolia, known as the State Great Hural, from 1990 to 1991, and finally as director of the Foreign Relations Division (later Department) of the Great Hural from 1991 to 1997, when he was also the responsible Secretary of the Mongolian Inter-Parliamentary Group. During Mongolia's transition from Soviet-style rule, Altangerel was involved in re-establishing the country's foreign policy apparatus for the new regime. 
In 1997, Altangerel was assigned to his first ambassadorship, to serve as the first-ever Mongolian ambassador to Turkey, resident in Ankara and concurrently accredited to Bulgaria, Lebanon, Romania and Uzbekistan, from 1997 to 2003. He then served as director general for Legal and Consular Affairs of the Foreign Ministry from 2003 to 2008, and as director of the Law and Treaty Department from 2004 to 2008. He also spent five years (2007-2012) as a member of the board of directors of the Trust Fund for Victims of the International Criminal Court. From May 2008 to late 2012, Altangerel was ambassador to the United Kingdom, resident in London and concurrently accredited to South Africa, Ireland and Iceland. 
Altangerel speaks Russian, English and Spanish. An enthusiastic equestrian, Altangerel owns a dozen horses and even attended Royal Ascot while posted to London. 
He and his wife, Erdenee Chuluuntsetseg, have three daughters.

Special traffic rules during CD Ministerial Conference, April 26-29
April 19 ( Due to the upcoming 7th Ministerial Conference of the Community of Democracies, that is to be held in Ulaanbaatar city on April 26th to 29th, there will be changes to the metropolitan road and transportation arrangement. 
The Public Transportation Authority announced a plan for free electric trolley bus services by public transportation companies to passengers during these days. Officials believe that traffic will be heavy due to the foreign guests invited to the conference so restrictions on vehicle use in the center of the city, based on license plate number, will be in place during this time
Currently 52 trolley buses run on a scheduled four routes for passengers. On April 26th to 29th these buses will be available for free. 
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Social, Environmental and Other
A Green Model for Mine Reclamation for Artisanal Mining in Mongolia
April 17 (The Asia Foundation) Mongolia sits on some of the world's largest mineral deposits, primarily coal and copper, as well as rare earth and precious metals. While the country's abundant resources have driven Mongolia to the top of Asia's economic performers, the rapid growth has not happened without serious concern over the environmental impact from the country's booming mining industry.
The good news is that Mongolia's government is increasingly prioritizing green growth and environmental responsibility. In 2012, the government increased the mandate of the Ministry of Environment to include "Green Development," and established a new National Green Development Strategy and action program to outline ways for each major economic sector to transition to a greener economy.
The formal mining sector in Mongolia is comprised of officially registered small- to large-sized mining companies that are conducting commercial operations and have obtained formal mining licenses from the government. The minerals extracted from the formal mining sector last year made up nearly 91.3 percent of all exports. Informal, artisanal mining, on the other hand, is made up of small-scale miners who have limited access to capital and/or technology but may obtain access to land to carry out mining activities. It is estimated that artisanal mining contributes $110 million annually to export revenues. Given the large-scale investments that well-resourced mining companies are able to make on environmental rehabilitation efforts, there are a number of excellent examples in Mongolia of best practices in environmental reclamation and rehabilitation efforts. Lesser known are the efforts underway in communities where small and artisanal mining is taking place.
Artisanal and small-scale mining in Mongolia started to evolve in the 1990s when the country transitioned from a centrally planned to a market economy. In 1993, the government initiated its "Gold program" to promote development of the formal mining sector. This subsequently led to growth in artisanal mining which drove down unemployment by offering traditional herders an alternative, viable income when they suffered livestock losses and thus economic difficulties during Mongolia's catastrophic winter weather events (known as dzuds). The artisanal mining sector initially suffered from a poor reputation as it was often considered illegal and associated with environmental and social problems, such as soil and water pollution, mined land that was not being rehabilitated, and crime. However, in 2010, with support from development organizations and civil society, a more robust policy and legal framework declared artisanal mining a legal occupation, which meant that artisanal miners could secure mining land and formalize their operations into official partnerships.
Outreach among artisanal mining communities to promote the use of environmentally friendly technologies and reclaim environmentally degraded land has helped improve the public perception about artisanal mining as a viable alternative livelihood option. Indeed, it is increasingly seen as a greener and more socially responsible sub-sector.
The Asia Foundation has worked on responsible resource issues in Mongolia since 2006, but has primarily focused on industrial mining. However, over the last few years, we have been working closely with artisanal miners, to give them a greater voice and knowledge base. Now, these miners participate in multi-stakeholders groups (which also include local authorities, mining companies, and community members) that provide guidance on responsible artisanal mining and a place to discuss concerns.
One of the most critical environmental issues surrounding artisanal mining is the rehabilitation of degraded land, characteristics of which may include large unfilled holes and/or tunnels, compacted soils, lack of vegetation, and polluted water and soil. In 2012, we partnered with a local environmental NGO to help develop a model artisanal and small-scale mining land reclamation project in Uyanga district, Uvurkhangai province – one of Mongolia's mining areas with a large amount of un-reclaimed lands 490 km from the capital, Ulaanbaatar. We provided a training course for the NGO to work with 45 artisanal miners and undertake technical and biological reclamation of a two-hectare site, rehabilitating the land in conformity with the government's reclamation standards.
Although the site was relatively small, the project has created local enthusiasm for reclamation in the area and heightened awareness on how to conduct rehabilitation effectively. An added strength is that the district governor is upholding it as a model for mine reclamation. At his insistence, mining companies operating in the jurisdiction are now required to visit the reclamation site (with the NGO representatives) to learn what can and must be done to properly reclaim their operations. The NGO provides a letter for the governor confirming that the mining company has seen and understood the process and work involved in mine reclamation; otherwise, local permission to mine in Uyanga district will not be provided.
Increasingly, artisanal miners who we've met with are recognizing the need to improve their environmental responsibility in order to have their profession accepted in their local communities, and also so that local authorities will be more compelled to officially provide them access to local land to mine. While the sector faces many challenges, if the environmental and social impacts are effectively managed, artisanal mining has the potential to provide sustainable livelihoods for many rural citizens in addition to its significant contributions to the Mongolian economy.
The activities related to artisanal and small-scale mining under the Foundation's Engaging Stakeholders for Environmental Conservation (ESEC) program are implemented with the generous support of the Swiss Agency for Development and Cooperation (SDC).
Meloney C. Lindberg is The Asia Foundation's country representative in Mongolia and Bolormaa Purevjav is the program director for the Foundation's ESEC program there. They can be reached at, respectively. The views and opinions expressed here are those of the individual authors and not those of The Asia Foundation.

Rain and snow extinguish forest, grassland fires in Mongolia
ULAN BATOR, April 18 (Xinhua) -- Mother nature has come to Mongolia's rescue, with heavy rain and snowfall extinguishing a raft of forest and grassland fires, according to the Environment and Green Development Ministry Thursday.
Since the start of this year, 18 fires have broken out, destroying 203.52 square km of forest and grassland.
From 2010 to 2012, fires burned almost 82,000 square km of forest and grassland, causing a direct loss of 60 million U.S. dollars.
Emergency authorities have warned the period between mid-March and mid-June is peak fire season and people should take preventative measures and prepare to fight fires.

Attempt to smuggle 275 bear fangs caught
April 16 ( Zamiin-Uud Customs officers have seized 275 12-15 cm long, 6-8 cm wide fangs from the luggage of a Chinese person at an inspection, stopping an attempt to smuggle these mysterious animals' fangs on March 30th. 
Customs experts proved that the smuggled fangs had belonged to bears. The General Customs Office transferred the case to the Police Department in Dornogovi aimag for the investigation. 

April 16 (LIVE from UB) I have one week to go in my Indiegogo Campaign to raise finishing funds for LIVE FROM UB – the upcoming documentary film about rock in urban Mongolia!
I reached my goal of $7500 a couple weeks ago which was HUGE! But every additional dollar will help make the finished product that much better, and give it the boost it needs to reach a larger audience.
For those of you who have already joined the LIVE FROM UB team as a supporter, THANK YOU!
I'm asking everyone who believes in this project to help me make this last week count. Please share it via whatever social (media) means you prefer!
Thanks for helping turn this into a reality!
Go HERE to help!

2013 Steppe Forward Programme Summer Field Course, Mongolia
The Zoological Society of London's Mongolia-based Steppe Forward Programme (SFP) provides students from Mongolia and all accredited colleges or universities with a unique opportunity to learn about Mongolian biodiversity and conservation challenges and ecological fieldwork skills and tools in a unique natural setting amongst Mongolia's steppe grasslands.
Applications for the 2013 field course are now open!
If you wish to join us on the course please send an email to expressing your interest using 'Field Course' as the subject heading.
The course brings together a diverse group of Mongolian and international students bound by a common passion for ecology and environmental sustainability.
The field based course will be taught by conservation practitioners and scientists from the Zoological Society of London with input from lecturers from of the National University of Mongolia amidst Mongolia's unique rolling Steppe grasslands.
Students will experience traditional Mongolian nomadic lifestyle, camping, eating locally sourced traditional Mongolian food.
About the Steppe Forward Programme
The Steppe Forward Programme is a collaboration between the Zoological Society of London and the National University of Mongolia. Since 2003, we have developed and implemented a wide-range of conservation projects across Mongolia.
At present, these projects include field courses, wildlife camera trapping, conservation assessments for the production of National Red Lists, publishing of field guides to the birds and mammals of Mongolia, and implementing conservation projects on species such as the long-eared jerboa and the wild Bactrian camel.
Education, awareness raising and training are of real importance for conservation in Mongolia. The Steppe Forward Programme has a strong record in these areas, in particular through organising and running student field-courses.
The Steppe Forward Programme aims to empower Mongolians to create and manage conservation programs by providing them with tools necessary to design and monitor their own conservation initiatives, assess wildlife populations and design ecological studies.
The programme intends to significantly strengthen skills and develop initiative amongst Mongolian professionals working in ecology and conservation, providing capacity for continued high standards of training and practical conservation needed in Mongolia.

Mogi Munkhdul Badral Bontoi
Cover Mongolia
Mobile: +976 9999 6779
Skype: mogibb
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