Recent news

  • In keeping with its position as the world’s second biggest mining company, Rio Tinto has been taking several bold steps to halt contributing to climate change. With the divestment of its last coal project in 2018, it became the first major company to have no fossil fuel asset. This was also when Rio released its first climate change report titled ‘Our approach to the climate change 2018’. This has now been followed by “Our approach to climate change 2019”, which was released in February this year. In this Rio sets out its goal of achieving zero emission from its operations anywhere by 2050. That would cover both direct and indirect emission – in scientific parlance, Scope 1 and Scope 2 emission. CEO Jean Sebastien Jacques has said that the company will spend up to $1 billion in the coming five years on strategizing and getting ready to take up projects to reach the lofty goal. 
  • The first parliamentary election after the amended constitution comes into force on May 25 has been scheduled to be held on June 24, but there are some who want it to be deferred until the Coronavirus threat recedes. All contesting parties will campaign on the basis of their action plan which have first to be cleared by The National Audit Office. During its check this office found that all three major parties, and several of the others in the fray, had gone overboard in making promises. It promptly rejected their plans and asked the parties to submit by 25 April revised action plans that kept within the parameters of the law.   
  • Known to speak his mind, B. Lkhagvajav trained as a lawyer and holds a doctorate in business administration. He was President of the Mongolian National Chamber of Commerce and Industry and has been a member of the Supervisory Board of the Bank of Mongolia. In a long-ranging interview with G. Iderkhangai, he peppers his views on the present with snippets from the past, all to express some concern about what the future holds. At one time you used to regularly speak out when something significant happened in the mining sector, but for several years now, we have missed your strongly held and bluntly expressed views. What has kept you silent?          You are right. I have refrained from speaking on mining matters since, say, 2010, after expressing my views regularly between 2006 and 2010 when the OT agreements were being discussed.
  • The Mongolian People’s Party promised in 2016 that the 1072 shares of Erdenes Tavan Tolgoi held by every citizen would be “made alive and valuable”. The announcement by the company in February that it would distribute dividends before the parliamentary election was welcomed by shareholders -- most of whom would also vote in the election -- as a step in that direction, but for the MPP promise to be truly fulfilled, it is not enough to pay dividends. To be “alive”, the shares must be free to be traded in the stock exchange. Only then would citizens know that they own something “valuable”.  The “small” Tavantolgoi, a company treated as A-Grade by the Mongolian Stock Exchange, earned a net profit of MNT52 billion in 2018 when it sold 1.8 million tonnes of coal.
  • Following the success of the 2019 Block XX drilling campaign which resulted in the discovery of oil in the  Gazelle 1 and Heron 1 wells, as well as Heron 1 delivering one of the highest flow rates ever recorded in Mongolia, Petro Matad Limited, the AIM quoted Mongolian oil explorer, is now focused on securing the exploitation licence required under the production sharing contract (PSC) to enter into the development phase on Block XX. The company has been advised by the Mongolian authorities that there is support at the highest levels of Government to grant the licence, as the Government recognises that Petro Matad has been the country’s most active oil explorer in recent years and that the success of its 2019 exploration efforts is very well timed in light of the Government’s commitment to the construction of a domestic oil refinery.
  • I have been in the geological sector for 34 years and have worked in both the state and private sectors, as also in research organizations and foreign investment companies. I never left geology, even in the difficult years of transition to the market economy. After graduating in 1986 from the State University in Irkutsk in the then Soviet Union, I started my career as a specialist in the Institute of Geological and Mining Production and Research in what was then called the Geological and Mining Ministry. Here I did some Mongolia-related research under the guidance of Dr. J.Byambaa. Then I was a researcher with the Institute of Geology of the Academy of Sciences, and a specialist in charge of the Mongolia-related studies when the Mineral Resources Authority was founded. I am proud that I have worked closely with Mongolia’s best of the best scientists. 
  • Preliminary statistics for the first quarter show that the first turbulence of a coming crisis is being felt in the Mongolian economy. Foreign trade, which had grown slightly in the first two months, declined from mid-March. Exports that bring dollars to the domestic market fell by almost 50 percent. After a two-month standoff, mineral exports, including coal, are unlikely to reach the 42 million tonnes projected in this year’s budget. Due to declining coal supply, copper has become the leading export mineral. Although Oyu Tolgoi’s copper concentrate shipments continued, exports fell by 13 percent. Meanwhile, copper price hit $4,685 on the London Metal Exchange, its lowest since 2016. In the 2020 consolidated budget, copper price was estimated at $5,991. Although mineral exports have declined overall, the supply of iron ore with railway access has retained its growth. Currently, the budget revenue has been disrupted by MNT275 billion.
  • One of the key objectives of the long-term development policy Vision-2050, which the government has submitted to parliament for discussion and approval, is to put Mongolia among the top ten countries in the world in terms of happiness and freedom from corruption. Among the other goals of what the Prime Minister has called the “most ambitious” roadmap for national prosperity, are expanded use of innovation and technology-based knowledge, economic diversification, green development, raising the GDP by 6.1 times, and taking annual per capita income to $15,000. If these goals are indeed achieved in the next 30 years, Mongolia would have a seat at the table of the world’s developed countries, of which the top ten today are Singapore, the USA, Hong Kong, the Netherlands, Switzerland, Japan, Germany, Sweden, the United Kingdom and Denmark. According to the World Economic Forum’s 2019 Competitiveness Report, Mongolia ranks 102nd out of 141 countries  considered.
  • Sales revenue from the Salkhit and Asgat silver deposits would be used to compensate the loss to the exchequer from the writing off of pensioners’ loans, but will there be any revenue from Asgat at all in the near future, given that the appropriate technology for extraction there has not been identified? Nobody knows if there has been a breakthrough, but it seems unlikely.   Two other hurdles stand in the way of any quick start to sales from Asgat. First, it is about 3000 m above sea level and there is no infrastructure. Second, there are no processing facilities and ore is uneconomic to transport.
  • Following the outbreak of the Novel Coronavirus in worldwide to inform that we are forced to postpone Mongolia’s largest international mining and oil expo 2020 originally planned to take place from 8 – 10 April 2020 in Ulaanbaatar, due to emergency situation related with the 1st Covid 19 case in Mongolia. A new date for the expo is yet to be scheduled. We aim to organize Mongolia Mining 2020 prior to this summer's mining season for the best benefit of our exhibitors, partner and mining industry. Dates for the expo will be set depending on further circumstances and we will officially inform you at least 30 days prior to the new dates.
  • BAYAN-UUL   The Bayan-Uul silver-mixed metal deposit is under an exploration licence. Its central part is in Choibalsan soum of Dornod aimag, 790 km from Ulaanbaatar, some 20 km from the Khavirga border checkpoint and 27 km from the Khavirga railway relay of the Choibalsan-Ereentsav railway station. Geologically it is part of the Tsav ore node and is 25 km east from the Tsav silver-mixed metal deposit which is currently under mining.  Prospecting on 1:500000-1:200000 scales was taken up in 1975 by a Mongolia Geological Mapping Expedition team of the Geological Ministry of the former Soviet Union. This led to the preparation of a geological map, and the discovery of the Tsav ore node, the Tsav and Bayan-Uul silver and mixed metals deposits, as well as of the Salkhit, Modot, Altantolgoi and Omnod occurrences. Parts in these were identified where further detailed work was to be done. 
  • An agreement on setting up a gold refinery in Mongolia was signed during Prime Minister U. Khurelsukh’s visit to Kazakhstan in October 2019. The signatory on behalf of Mongolia was B. Achitsaikhan, CEO of Erdenes Alt Resource. G. Iderkhangai finds out from him the terms of the agreement and the progress on the ground.   A viable refinery must have adequate raw material to feed it. How successful has been Erdenes Alt Resource in prospecting, exploring, and extracting the precious metal?   Our company’s key goal is to build a gold refinery in Mongolia. From the very beginning we have been working with support from the Ministry of Mining and Heavy Industry and our parent company, Erdenes Mongol, on preparing for this. We have chosen the location and are now studying what kind of infrastructure we shall need.
  • Whenever and wherever mining is discussed, the talk soon veers to responsible mining and the hope it holds for the economic, social and environmental well-being of Mongolia. However, most of us would fumble if asked to define what exactly responsible mining is. A presentation by B. Mendbayar, Head of the Internal Auditing and Monitoring Division at Erdenes Mongol and the man who worked out the assessment methodology for responsible mining in an IFC-sponsored programme, at a seminar of the Local Journalists’ Network 2019 training project, went into details of how to evaluate a company’s record in responsible mining. E. Od, who took notes, now presents what was said. 
  • Towards the end of last year, an important event took place in the history of modern mining in Mongolia. It was the completion of a production shaft, one of the key infrastructure facilities of the Oyu Tolgoi Underground Project, with its headframe tower rising to the sky.  On the vast plains of Khanbogd, two distinct landmarks now catch our eye. First is Mt. Khanbogd, proud to be blessed by the sun. This sacred mountain, created by God, contains the best of minerals, and is also a storehouse of history and legends, a slice of human culture. God only knows how and when it was created and what it has seen since then. The second landmark, not far away from the sacred mountain, is the Oyu Tolgoi tower – built only recently by human intelligence and hard work. It looks mesmerizing, especially at dawn and dusk. I ask for your forgiveness for daring to compare these two “creations”, but, as it is said, there is always some connection between things. 
  • We have often noted how the US-China “trade war” can, even if obliquely, affect Mongolia’s exports to its southern neighbour, but just when the two countries announced a truce in mid-January and raised hopes of smooth sailing in the new year, came news of an unexpected threat – the coronavirus. The infection from this virus, almost crippling life in China and threatening to spread worldwide, is endangering the global economy, and nearer home, Mongolia’s trade with its biggest and almost sole export destination.
  • S. Enkhtuya, CEO, writes:    That eight of the largest mining companies have come together to join the Voluntary Code of Responsible Mining has great importance in that this will enthuse other companies to join them in strengthening the case for responsible mining. It will also create pride among citizens working in mining as opening the way for raising the sector’s reputation in the public mind. 
  • Z. Gan-Ochir, CEO, replies to questions sent by MMJ: How does your company see the importance of joining the Voluntary Responsible Mining Code?  Mining is the main lever of Mongolia’s economic development. It accounts for one third of the state budget. If mining stops, not only will 60,000 people become unemployed, but also public services such as schools and hospitals will be seriously inconvenienced. Thus mining cannot be allowed to stop. That being the case, it is crucially important that the extractive industry operates with responsibility. This is why we are happy to be part of the Join for Responsibility initiative. We hope the campaign will go a long way in correctly explaining to the people the role and activities of the mining sector and thus giving it its deserved space in society. 
  • The Mongolian Mining Journal, the first journal in Mongolia to specialize in economic and mining topics, has signed a cooperation agreement with the Mongolian National Public Radio and Television (MNB)’s MNB World channel. Under this, the English-language contents of The Mongolian Mining Journal are now featured regularly in a programme on MNB World TV channel starting from January 2020, allowing the journal to add television viewers to its print and online readership. The editorial team at The Mongolian Mining Journal, popularly known as MMJ, has more than 11 years of experience in covering mining, economic and business topics.
  • Armando Torres, CEO, replies to questions sent by email:  Why do you consider the Memorandum of Understanding (MoU) on the Voluntary Code of Practice for Responsible Mining to be significant?   I believe this MoU lays out a strong foundation to promote best practices of responsible mining across the mining industry and streamline cooperation among major mining companies in Mongolia. What is the next step for your company after signing  the MoU? We see it as an opportunity to share our best practices with our mining peers, broader stakeholders and the public and also to learn from others. Together with our partners of the MoU, we will support development of responsible mining in Mongolia by fostering a better understanding of what the industry needs to do in order to create mutual trust and shared responsibility for responsible mining in society. 
  • Almost two months have passed since the Constitution was amended to include a provision mandating that profits from underground resources would be put into the National Wealth Fund to be distributed equally among the people of the country. The passage of the amendment was preceded by a prolonged period of debate, often acrimonious, on the exact words and terminology to be used but there was never any dispute that natural resources were state property and the results from their exploitation should be for the public good. 
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  • 2021-09-14 12:21
    In March of this year Finance Minister B. Javkhlan indicated it was to early to say if the budget spending limit would be amended. The minister stated “Although citizens are demanding and amendment to the budget, it is not an issue I can resolve. To date, budget expenditures have not been interrupted and investments have not stopped.” But the pandemic continues to worsen the border points remain closed and the national economy remains at risk. The current macroeconomic forecast for 2021 has “turned” from the original created earlier this year. It is expected that the budget deficit will increase to 8.8% of GDP, past the Budget Law limit and will require a new amendment. Last year the finance minister predicted that 2021 would be the year where Mongolia returns to complying with fiscal limits. 
  • 2021-09-07 13:12
    On July 10, 2021, the management and personnel of Erdenet Mining Corporation, a state-owned enterprise, received the honorary title of National Hero of Mongolia from U. Khurelsukh, the President. When the Head of the State started his first business trip to the local community from the Orkhon aimag, he handed over the award to the managers of the corporation. This is a matter of special honor. In the presidential decree, the past, the present and the future of the Erdenet Mining Corporation were described well in a few words: “Having recognized the support and endeavor of the Erdenet Mining Corporation, a construction development of the XX century, to and for Mongolia’s prosperity,
  • 2021-08-16 13:48
    Mongolia’s largest coal producer, Erdenes Tavan Tolgoi, is on the fast track to expand its operations.  If current expansion plans become a reality, they expect to produce 47 million tons of coal annually with projected revenues 10 trillion MNT per year by 2025. This is to be achieved through investments in capital projects over the next five years, worth an estimated 10 trillion MNT.  By ramping up its operations, revenues would grow geometrically, increasing its dividend to investors and revenue to the government (currently 81.5% of the company is state owned and 18.5% by citizens and private investors).  These investments are to be funded from internal revenues, bond issuances and   debt.    By expanding their capacity, ETT aims to take advantage of new market conditions and increase their market share in China. 
  • 2021-07-19 11:36
    In connection with the amendment to the Minerals Law, E. Odjargal talks to D. Erdenechimeg, Manager of the Governance Program, Open Society Forum, and a member of a sub-working group for the draft law, on regulations such as enforcement of Article 6.2 of the Constitution, licensing and local relations.  What is the status of the revision draft of the Minerals Law?  Last January, the Ministry of Mining and Heavy Industry (MMHI) established a working group to develop a draft law on bringing minerals laws into conformity with the Constitution. Two sub-working groups were established: one to provide policy guidelines for the team developing the revision draft of the Minerals Law, and the other to carry out a package of studies under the Law on Legislation. 
  • 2021-07-09 11:35
    As of June, the pandemic has cost Mongolia over one billion USD in export revenues and caused a two year-delay to the country’s development. It is expected that in the next few months the pandemic will end, and things will begin returning to normal.  Last year our country was nearly infection free and symbol of successful management.  This year the infection numbers are surging dramatically despite having one of the world’s most successful mass vaccination campaigns.  This is in part due to a reduction in public compliance with preventative measures that were exacerbated by the Presidential election and the MPP’s 100th anniversary events. Not complying with the prevention protocols has quickly erased our prior success and the efficacy of the vaccination program.
Do you agree with increasing state participation in the Draft New Mining Law?
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  • 2. Disagree
  • 1. Agree
  • 2. Disagree