Z. GAN-OCHIR: THE SECTOR'S POLICY ENVIRONMENT REMAINS RELATIVELY CLOSED, WHILE THE COMPETITIVENESS OF THE TAX REGIME IS WEAK

By A. Khaliun

The international "MiningWeek & MinePro 2026" conference of Mongolia's mineral resources sector will be held as usual on September 16–18 at Taij Khairkhan in Nalaikh. MMJ journalist A. Khaliun interviewed Z. Gan-Ochir, Chairman of the Council of the Mongolian National Mining Association (MNMA) and Acting Executive Director of the MNMA, about this year's conference highlights and the current state of the mining industry.

You were recently elected Chairman of the MNMA Council, and "MiningWeek & MinePro 2026" is coming up. What will be distinctive about this year's Mining Week?

I was elected Chairman of the Council of the Mongolian Mining Association (MNMA) last July. Under the leadership of former MNMA Council Chairman G. Battsengel and Executive Director G. Erdenetuya, the Association's activities in the mining sector have been highly active and stable over the past four to five years. The MNMA has worked intensively to promote responsibility among industry stakeholders, improve public understanding of the mining sector, introduce global mining standards and codes in Mongolia, and establish the foundations for responsible mining practices.

Going forward, we will continue to emphasize constructive initiatives and active engagement. The individuals who have already earned recognition in the sector through their achievements will continue contributing to the development of the industry. We will work together closely.

I am assuming this leadership role at a time when the MNMA's operations have become well established and stable. Moving ahead, we will focus on maintaining sustainable operations, further institutionalizing the organization, providing the public with accurate and reliable information, and working together to address policy challenges facing the mining sector, as well as obstacles encountered by companies engaged in production and services within the industry, including issues requiring solutions in the legal and regulatory environment.

The "Mining Week" conference has been held for many years, creating a platform to discuss Mongolia's unified mining policy, investment opportunities, globally recognized technologies, and cooperation issues on a broad scale, while facilitating the exchange of information and knowledge. As a result, its overall format and operations have become well established and refined.

The Mongolian National Mining Association (MNMA) is one of the key organizers of the conference. It has evolved into a strategic platform where mining companies and enterprises operating in the sector, together with policymakers, decision-makers, government institutions, and mining suppliers, come together once a year to discuss the industry's future direction, address pressing challenges, and seek solutions and pathways forward.

This year, the conference will focus on key policy issues related to the global economic outlook and the direction of mineral commodity markets amid the energy transition, which has become one of the major drivers of economic growth. Discussions will center on where mineral markets are heading, how prepared we are for these changes, and what role Mongolia should play in this evolving landscape.

The conference aims to address the key questions of "What are the global trends shaping the mining industry? How are countries adopting advanced technologies strengthening their competitiveness? Where does Mongolia stand in this competitive landscape, and how should we position ourselves to participate?" It will provide a platform for stakeholders to discuss these issues and collectively explore the future development direction of the mining sector.

During MiningWeek-2026, in addition to discussing the industry's overarching policy issues, the conference will cover a wide range of topics, including the sector's achievements, newly introduced technologies, occupational health and safety, mine rehabilitation, environmental initiatives, as well as challenges faced by NGOs and local communities involved in these areas.

The main conference and sector-specific sessions are open not only to industry professionals but also to the general public. On the third day of the conference, the "Future Engineers" program will be introduced to university students and young people interested in the mining industry. The public is invited to attend and participate.

What stage of development has Mongolia's mining sector reached today?

Mongolia's mineral resources sector is expanding its cooperation, embracing new technological trends, and demonstrating clear opportunities for further development. I believe the mining industry is progressing toward a new stage of growth, with companies increasingly incorporating modern solutions across their operations.

Although the competitiveness of Mongolia's mining sector remains relatively weak compared to other countries around the world, there is significant potential to further develop the industry and strengthen its global position. If we do not seize these opportunities, we risk falling behind as the global industry continues to move forward.

The global energy sector is undergoing a major transformation, with countries shifting toward renewable and clean energy sources. What position does Mongolia's mining sector hold in this transition?

Mongolia's energy sector has reached a crossroads. At this critical juncture, we need to focus on two key issues. First, we must assess the energy resources available within our own country and identify the most effective ways to ensure a secure and independent domestic energy supply.

Second, we need to understand how today's geopolitical developments are reshaping the structure and long-term trends of global supply chains in traditional energy markets—including coal, oil, and natural gas—and develop appropriate strategies in response to these changes.

Approximately 25% of global oil consumption passes through the Strait of Hormuz before reaching consumers around the world. The confrontation between the United States and Iran has continued for an extended period, and it remains uncertain when the situation will return to normal.

The longer this uncertainty persists, the greater the risk of disruptions to global oil supply chains. Countries are seeking their own solutions and exploring different approaches to address potential oil shortages and reduce the risks associated with such dependencies in the future.

The key question is how these solutions will affect Mongolia. Although Mongolia does not import fuel through the Strait of Hormuz, the impact will inevitably be felt indirectly through the countries that export to Mongolia.

On the other hand, it is essential to seek and implement long-term technological solutions to address these potential shortages. These may include the development of renewable energy and nuclear energy solutions. At the same time, a resurgence in coal consumption cannot be ruled out.

We need to closely monitor how these developments may affect Mongolia's mining sector and, based on our assessment, determine what role and position we can take in this evolving market. Accordingly, we must make timely policy adjustments that align with these emerging opportunities and challenges.

Given global energy transition trends, does Mongolia have the opportunity to become an active participant in this transition?

Looking at global energy transition trends, Mongolia has several advantages. Our neighboring country, China, is implementing leading energy transition technologies and solutions. Therefore, our geographical proximity gives us an advantage in adopting and integrating these technologies from China.

However, from a broader perspective, Mongolia is currently falling behind in terms of energy transition policies. Based on the policies being implemented by the Ministry of Energy, our country has only begun taking steps toward the energy transition within the past year.

If we develop effective solutions in the short term and move forward with urgency, we have the opportunity to quickly close this gap.

Mongolia has an economy heavily dependent on coal. However, with the rise in global copper prices, export revenue from copper concentrate surpassed coal export revenue last year. In your view, which minerals offer the greatest potential for Mongolia's future?

I would say copper. In addition, the gold and precious metals markets also have strong future potential.

Mongolia's economy is heavily reliant on mining, and particularly on coal. Therefore, the first priority should be to diversify export revenues by expanding the range of export commodities. Copper is a key mineral that can drive this diversification.

Copper production at Oyu Tolgoi increased last year, exceeding 300,000 tonnes. Over the next three to four years, Oyu Tolgoi has the potential to export 450,000 tonnes of copper annually, which would help diversify Mongolia's export revenue base.

We also need to expand the range of Mongolia's mining export products. The exploration sector remains underdeveloped within Mongolia's mining industry. Discovering deposits that can compete in global markets requires the combined efforts of skilled professionals, advanced technological solutions, significant investment, and 10–20 years of persistent work and dedication.

We are now experiencing the consequences of having neglected this area over the past decade. Even in today's relatively favorable economic environment, we are not yet in a position to identify the next major deposit beyond coal and copper.

Are you referring to rare earth elements?

Rare earth elements are one category of critical minerals, and in this area Mongolia has the opportunity to develop not only mining operations but also the next stage of advanced processing and value-added production. These minerals are becoming increasingly important under current geopolitical conditions.

There are several projects in this sector that are being advanced based on traditional exploration studies, and it is essential to support and develop these projects. Unfortunately, companies working to advance these initiatives continue to face various obstacles. We must address and overcome these challenges as a matter of urgency.

Local communities and the general public need to have a better understanding of these issues. A large amount of information—some unverified, inaccurate, or deliberately distorted—is spreading through social media, making it increasingly difficult for people to distinguish reliable information and make informed judgments.

Therefore, the involvement of all stakeholders is crucial. It is the responsibility of industry participants to ensure that the sector is properly understood. Government institutions, meanwhile, are responsible for implementing policies and decisions effectively, communicating them clearly to the public, and ensuring that this key pillar of the economy can continue to develop without unnecessary obstacles.

The role of media organizations is also important in providing the public with accurate information that contributes to social and economic development. Only through broad cooperation and collective discussion among all stakeholders can we reach effective solutions.

How will domestic and international investors participate in this year's MiningWeek? What new initiatives are being introduced to increase their engagement and create a more favorable investment environment?

There was a period when foreign investors showed strong interest in Mongolia and invested in the country. However, today our economy has expanded, and domestic investors have become increasingly active.

For example, when the Government issues bonds, domestic companies are purchasing them. Corporate bonds are also attracting interest from citizens and deposit holders. This indicates that Mongolia's economy has reached a certain level of development, domestic savings have increased, and overall economic stability has strengthened.

However, it is essential to continue pursuing policies aimed at attracting foreign investment. The Parliament of Mongolia is expected to discuss amendments to the Minerals Law, and there is an expectation that the adoption of these amendments will help increase investment inflows.

We actively promote our sector's policies both domestically and internationally wherever we engage with stakeholders. Investors are showing interest and are closely watching what changes Mongolia will introduce to the legal and regulatory framework governing the mining sector. Of course, we are still far from returning to the level of investment activity seen during the historic period of 2009–2011. Particularly at the regional level, and compared with Central Asian countries, Mongolia's mining sector policies remain relatively closed, while the competitiveness of our tax environment continues to be weak.

Therefore, if we can align our overall policy framework and legal environment with international standards, further improve and strengthen them, and make them competitive at the regional level, we will establish the foundation for the sustainable development of the mining sector.

What is the MNMA’s position on the draft amendments to the Minerals Law?

The MNMA has submitted proposals on several key areas, including opening up exploration activities, establishing a more realistic approach to the calculation of the mineral resources royalty (MRR), ensuring a more equitable distribution of revenues to local communities, and making government policy on critical minerals more effective and transparent.

These are essential provisions that must be incorporated into the legislation. We have presented these proposals repeatedly since the terms of office of the previous four ministers. As these amendments contain important provisions aimed at ensuring the sustainable development of the mining sector, expectations among industry stakeholders are also high.

What is the MNMA’s position on critical minerals?

The Association has a clear position on critical minerals. We believe that critical minerals should be treated as a strategic priority, and Mongolia should aim to establish a meaningful role in global supply chains.

The world is now competing to become part of newly emerging supply chains. To enter these expanding market opportunities, countries are competing through their policies by supporting exploration, mining, and downstream processing, while working to strengthen their positions in this sector.

At this stage, Mongolia must adopt policies aligned with international practices in order to bring its mineral wealth into economic circulation and diversify its economy. We are concerned about the possibility of adopting overly restrictive or closed policies.

On the other other hand, China currently leads the world in the processing and refining of rare earth elements. Mongolia needs to define how it will participate in these supply chains and implement a long-term, stable policy framework.

If we can become an active participant in this newly emerging market, it will be highly significant for the development of our country. This represents one opportunity to diversify revenue streams from mining products.

The coal market will certainly not disappear overnight in the future. While demand will not come to a complete halt, export growth may slow over the long term. It is still too early to determine how a slowdown in growth would affect prices.

With global trends already becoming clear, Mongolia should begin working without delay to bring into production those raw materials for which market demand is increasing.

At the COP17 conference held in Ulaanbaatar, mining issues were discussed for the first time. Mining companies committed to planting saxaul trees across 5,000 hectares of land as part of efforts to combat desertification. This demonstrated to the public that the mining sector is taking a leading role in addressing desertification and mitigating the impacts of climate change.

Yes. The mining sector in Mongolia supported and actively participated in the 17th Conference of the Parties (COP17) to the United Nations Convention to Combat Desertification.

Mining companies have been proactively implementing initiatives in areas such as afforestation, desertification mitigation, and the introduction of new technologies to reduce water consumption. They are increasingly focused not only on extraction activities but also on establishing responsible mining practices.Mining companies are supporting the national "Billion Trees" movement and have become one of its key driving forces through their active participation. The sector's level of responsibility is continuing to improve, with progress being made in building mutual trust and stronger cooperation with other stakeholders.

The global mining industry plays a crucial role in supplying the essential raw materials needed as part of the solutions to address environmental degradation and mitigate the negative impacts of human-induced climate change.This is a key component of the global green energy transition, which aims to ensure environmental sustainability and secure a better future for generations to come.