ADEN REPRESENTATIVES VISITED EK
On Oct 28th CEO and CFO of Aden visited Mongolia. They met local clients, discussed potential projects and cooperation.
EK TEAM GAVE A LECTURE TO ENGINEERS
On October 30, Sales Manager Khash-Erdene Tsagaanchuluun and Chemist, Water Specialist Tamir Puntsag (Ph.D.) hold a seminar to engineers of “Water and Piping Engineers Association”. Team introduced HUESKER brand solutions and water analyze methods of VEOLIA.
EK BUSINESS TRIP TO ERDENET MINING CORPORATION
Between November 6 to 7, the EK team traveled to Erdenet city for a business trip. The business trip team including Ms. Narantsatsralt Tsedendamba /Sales Director/, Mr. Zolboo Bold /Sales Manager/ were successfully met Erdenet Mining Corporation’s representatives.
During the visit, the trip team attended business meetings at EMC headquarter. Highlights of the trip were introducing EK’s new business in MRO consumables supply to EMC high officials and discussed a further partnership.
EK MET FEDERAL MINISTRY FOR ECONOMIC AFFAIRS AND ENERGY REPRESENTATIVE
Our CEO held a meeting with Dr. Markus Utsch, representative of the raw materials unit of the Federal Ministry for Economic Affairs and Energy. Dr. Utsch visited us in Ulaanbaatar to discuss German-Mongolian mining initiatives according to the German-Mongolian Agreement on Cooperation in the Raw Materials, Energy and Technology Sectors signed by Federal Chancellor Angela Merkel in 2011. Our CEO updated him with an overview of current and upcoming projects.
ECONOMY
MONGOLIA SPENDING MNT 75.2 BILLION FIGHTING AIR POLLUTION
The National Committee for fighting air pollution conducted a hearing today (4 November) on the consumption of coal briquettes. This year, a total of MNT 75.2 billion has been allocated to carry out 32 anti-pollution measures. As of today, around MNT 54.73 billion is being spent in compliance with the relevant legislation.
A staggering 80 percent of air pollution in Ulaanbaatar city is caused by the coal-burning stoves used by households in the ger districts. Regarding the remainder: 10 percent is caused by vehicle exhausts, six percent by the capital’s power plants and four percent from waste disposal, dust and soil pollution.
The government has pledged significant funding to clean up the air — the equivalent of $55 million since 2008.
Source: News.mn
MONGOLIA-RUSSIA-CHINA BORDER RAILWAY COMMISSION CONVENES
A consultative meeting of the Mongolia-Russia-China Border Railway Commission took place in Ulaanbaatar on November 1. At the annual consultation that is of great importance in increasing freight and passenger transportation of Ulaanbaatar Railway (UBTZ) JSC and determining Mongolia’s export and import volume, representatives of the three countries discussed coordination of rail transport that has been on the rise lately.
The sides emphasized that the the number of trains traveling through Erlian-Zamiin Uud and Sukhbaatar-Naushki border crossings as well as the volume of export and import freight transportation of UBTZ are increasing thanks to the annual meeting and this signifies the escalating development of bilateral cooperation.
Last year, UBTZ set a historic record by transporting 25.8 million tons of freight throughout the year and transported 20.5 million tons of freight in the first nine months of 2019, a 9.4 percent increase from the same period in 2018.
Source: Montsame
WORLD BANK: MINING INFRASTRUCTURE INVESTMENT SUPPORT (MINIS) PROJECT
What is the MINIS project?
The MINIS project provides technical assistance to help the Government of Mongolia build its capacity to apply international standards when analyzing and preparing infrastructure projects for possible investment.
Does it finance investments in infrastructure?
No. The MINIS project finances only technical assistance. Therefore, no infrastructure investments are eligible for financing under the MINIS project.
What does it finance?
MINIS finances the preparation of studies, including feasibility studies (technical and economic assessments), as well as environmental and social impact assessments. It also helps build local capacity to plan and prepare infrastructure projects.
Source: World Bank
GACHUURT-NALAIKH-CHOIR ROAD OPENS
A 20.9 km new road between Gachuurt and Nalaikh-Choir junction has opened for traffic today. Although this 26-meter wide two-way and four-lane road with the drainage, bridge and tunnel has been opened for traffic today, it will be fully complete by July of next year after making more works including pedestrian and cycling roads, flyover as well as others.
Funded with China’s soft loan, construction cost of the road between Gachuurt and Nalaikh-Choir junction is USD 36 million. The project is being executed by a general contractor China’s ‘Sinohydro Corporation Limited’, sub-contractors ‘Tegshplant,’ ‘Gashuuny Gol’ and ‘Dardan Zam’ companies, with ‘Munkhad ashdyn zam’ consultancy.
Chinese Ambassador Xing Haiming emphasized that the road construction presents Mongolia-China friendly relations and will take an important place in bilateral relations and cooperation. The ambassador mentioned that the two countries are doing more construction works within the 70th anniversary of the diplomatic relations between the two countries.
Source: Montsame, Xinhua, News.mn
LEATHER MANUFACTURERS' PROMOTION DAY HELD
Ministry of Food, Agriculture, and Light industry has organized an event to promote leather manufacturers of Mongolia.
Affiliated organizations of the Agricultural Ministry as well as local producers of tanning industry, such as Darkhan minj LLC, Darkhan nekhii JSC, Khos az LLC, Mongol shevro JSC, Agni, Yanmal, Kajug, Maris and MR have taken part in the event to present their products and production processes. In addition, domestic leather professionals and producers of the ‘Erasmus’ project aimed at establishing leather hub in Mongolia have provided customers with advice on leather product use.
A goal to develop leather industry as a leading economic sector is reflected in national program documents, such as Sustainable Development Concept, Green growth policy and Mongolian Exports and Industrialization 21:100.
Source: Montsame
‘WATER AND MINING’ DATA HACKATHON SPARKS A RANGE OF INNOVATIONS IN MONGOLIA
IFC, a member of the World Bank Group, in partnership with BHP Foundation and Unread Media, hosted the ‘Water and Mining’ Data Hackathon at the Hub Innovation center recently. The event was organized by IFC’s From Disclosure to Development (D2D) program to encourage young and tech-savvy contestants to use existing natural resource data sets for innovative solutions that address Mongolia’s water issues.
The event offered participants an opportunity to be trained and supported by Mongolia’s top water and data experts to improve their water data analysis skills and communications strategies. While over 480 applicants registered as teams or individually, 12 teams were selected for the 36-hour hackathon.
Welcoming all participants, Rufat Alimardanov, IFC Resident Representative for Mongolia, said, “There is a growing demand for industries and governments to be more transparent. Therefore, we need to focus on using existing data more effectively.”
Source: Montsame
ENERGY SECTOR WITHOUT FUEL - EDITORIAL
Development without electricity does not exist. In Mongolia, 15% of the total population is living without electricity, 70% is living with an outdoor wooden toilet, and one third is living in poverty.
The underlying reasons are energy shortage and its unreliable supply. Instead of holding an extensive discussion and remedying the situation, the Mongolian public has wasted 20 years by dividing and running into battles from election to election, believing in empty promises of politicians, and psyching out along with those politicians.
Mongolia is unable to provide the entire population with sufficient and reliable energy, yet it has abundant sources of energy such as coal, sun, and wind. Despite the energy shortage, the authorities began fooling us by claiming that Mongolia will supply electricity to the Asian continent. In reality, the energy policy without fuel is concealed behind such claim.
Source: Jargal DeFacto
GEOLOGISTS KEEP ABREAST WITH OYU TOLGOI MINE DEVELOPMENT PROJECT - EDITORIAL
An establishment of the first national mining and mineral fund at the then-Ministry of Industry and Construction in 1939 marks the beginning of history of the Mongolian geological sector, which has grown as an independent industry of the country up to the present moment, providing coverage of various geographical exploration and studies encompassing the whole territory of Mongolia. As results of the explorations made in the past eight decades, more than 1900 deposits comprised of around 80 types of minerals, including world-class mineral deposits, have been discovered in Mongolia. One of such accomplishment made by Mongolian geologists along with foreign experts is the major discoveries of Oyu Tolgoi that continued for several decades.
Today, the exploitation of the currently estimated 20.8 million tons of copper and 23.5 million ounces of gold from the Southern Oyut open pit and underground deposits of Oyu Tolgoi, have moved forward already to…
Source: Montsame
BUSINESS
DOING BUSINESS WITH MONGOLIA GUIDE
This guide aims to provide a route map of the way ahead, together with signposts to other sources of help.
The main objective of this Doing Business with Mongolia Guide is to provide you with basic knowledge about Mongolia; an overview of its economy, business culture, potential opportunities and to identify the main issues associated with initial research, market entry, risk management and cultural and language issues.
We do not pretend to provide all the answers in the guide, but novice exporters in particular will find it a useful starting point. Further assistance is available from the Department for International Trade (DIT) team in Mongolia.
Source: Mongolia.DoingBusinessGuide.co.uk (PDF)
RIO TINTO COMPLETES SHAFT 2 DEVELOPMENT AT OYU TOLGOI MINE IN MONGOLIA
Global mining group Rio Tinto has completed development of Shaft 2 at the Oyu Tolgoi mine in Mongolia.
The completion is a significant milestone that will speed up underground development work at the mine site.
The mine is now moving towards the process of final commissioning.
According to Rio Tinto, Shaft 2 is a 10m diameter shaft sunk to approximately 1.3km below the surface.
It allows the mine to transport 300 people per cage cycle versus a maximum of 60 people per cage cycle through Shaft 1.
Rio Tinto noted that the 48t capacity cage in Shaft 2 can now be used to support logistics and transport supplies and other components for the mine development.
In January, the Government of Mongolia and Rio Tinto signed a framework agreement for the supply of electricity to an extension of the copper mine at the Oyu Tolgoi project by mid-2023.
Source: Mining-Technology.com
MONGOLIA'S COAL IPO SQUEEZES THROUGH NARROW HOLE
Hong Kong: Mongolia's prize mine is squeezing to market through a narrow gap. Ulaanbaatar has again picked advisers to list Erdenes Tavan Tolgoi. It's no easy sell: a huge but landlocked coal deposit with one major market and a decade of false starts. Still, with some Chinese backing and a 2020 election to focus minds, it has a chance of making it this time.
It's been a bumpy ride. An early initial public offering plan in 2011 foundered after multiple delays, and Mongolian lawmakers sank a $4 billion investment proposal from a consortium including Japan's Sumitomo Corp in 2015. Investor appetite for coal has faded since, even if the quality, steelmaking kind - on offer here - remains in demand.
Bank of America and Credit Suisse, among advisers picked to run the $1 billion-plus sale, will meet plenty of scepticism.
Source: The India Times
See also: Mongolian Coal Giant Selects Banks for $1 Billion Hong Kong IPO
FIRST LICENSE AT CHINA INT’L IMPORT EXPO GIVEN TO MONGOLIAN COMPANY
An exhibitor from the Republic of Mongolia was presented with the first business license to be granted at the second China International Import Expo by Qingpu District's market watchdog on Tuesday.
The Mongolian National Chamber of Commerce and Industry authorized its Chinese representative to set up a business management company in the district, selling some 10 varieties of products including cashmere sweaters, leather bags, beer, sea buckthorn juice and rapeseed oil.
These products are the most representative commodities of Mongolia, said Dashnyam Gerelmaa, director of the chamber which comprises 10 Mongolian companies.
The company will become a window to showcase commodities from the Republic of Mongolia, she said.
The Qingpu District Administration for Market Regulation said authorities had started collecting registrations from exhibitors before the expo opened.
The company's registration material was submitted on Tuesday morning to authorities at an enterprise service area set up by market watchdogs at the expo venue, and the business license was issued in the afternoon.
Source: Shine.cn
FIRST RUSSIAN GAS SENT TO MONGOLIA
Gazprom Export supplied Russia’s first small-scale LNG cargo to its new market – Mongolia. On October 22, the first ever rail LNG shipment was loaded in special cryocontainers in Yakutsk. It crossed the Russian-Mongolian border on November 2, and on November 4, arrived in Ulaanbaatar. The total size of the cargo was 36.0 tons of LNG (equivalent to approx. 50,000 cm of natural gas).
Siberian fuel and energy company (SITEK) was the shipper of the cargo. The buyer was the Mongolian company UB Metan. The LNG will be used as motor fuel on public transport in Ulaanbaatar, the capital of Mongolia. In total, according to the buyer, the demand for LNG in Mongolia in 2020 can reach 8,000 tons (equivalent to 11 mcm of natural gas).
Source: Gazprom Export
See also: Issue of trans-Mongolian gas pipeline touched upon
MONGOLIAN COSMETICS MANUFACTURERS TO ENTER THE EUROPEAN MARKET
On November 1, the EU-funded Trade Related Assistance of Mongolia (TRAM) project and the Mongolian Cosmetics Cluster NGO co-organized the ‘Mongolian Cosmetics Cluster partnership event’ at the Mongolian National Chamber of Commerce and Industry (MNCCI).
During the event, a Memorandum of Cooperation was signed between the Ministry of Food, Agriculture, and Light Industry, and the Mongolian Cosmetics Cluster NGO in aims of giving support to the development of the Mongolian cosmetics industry, partner in enhancing the sector policy and legal environment, and developing partnership between state and private entities.
Works are currently being done on developing the manufacturers of the following four sectors: organically produced cosmetics, sea buckthorn oil, yak fiber, young camel hair, and leather, as clusters, and building their capacity for export products. One of the first clusters, Mongolian Cosmetics Cluster NGO is running its operations, having unified the sector’s leading 15 companies.
Source: Montsame
ELIXIR’S MONGOLIAN CBM DRILLING: AN UPDATE
Elixir Energy Limited today provided a further update on its 2019 drilling program at its gigantic 30,000km2 Nomgon IX coalbed methane (CBM) production sharing contract (PSC) on the Mongolia-China border.
The company emphasise that the primary aim of the program is the drilling of two fully tested core-holes, with an option for a third — the results of which will feed into a contingent resource assessment in the new year.
While these core-holes have yet to be drilled, the drilling program has in recent weeks been supplemented by the drilling of low-cost chip-holes.
These holes are achieved for a fraction of a “fully loaded” core-hole cost and provide Elixir with valuable stratigraphic and geological information that allows it to fine tune the core-hole drilling and guide future exploration programs.
The chip-holes have been placed in geologically strategic locations and not all the stratigraphic chip-holes are anticipated to encounter thick coal seams.
Source: Finfeed.com
ERDENE PROVIDES KHUNDII GOLD DISTRICT EXPLORATION & TECHNICAL PROGRAM UPDATE
Erdene Resource Development Corporation is pleased to provide results from the second phase of the 2019 gold exploration program, and to announce the commencement of the Q4 2019 drill program at its 100%-owned Khundii Gold Project.
“Our exploration results, including the successful step-out drilling at the Bayan Khundii (“BK”) deposit and the new Khar Mori (Dark Horse) discovery on the Khundii Mining Licence continue to demonstrate the potential of the Khundii Gold District,” said Peter Akerley, Erdene’s President and CEO. “First identified in 2015 by Erdene, the pace of discoveries is a testament to the virgin nature of this fertile district. These new prospects provide significant opportunities to grow resources at our high grade, open-pit development.”
“The final 2019 exploration program, focused on following up on the Khar Mori discovery, drilling on the Ulaan license and completing geotechnical and metallurgical drilling will kick-off this week,” continued Mr. Akerley.
Source: Erdene Resource Development Corp.
FIVE STAR DIAMONDS LTD. ANNOUNCES AGREEMENTS TO ACQUIRE NEW COPPER PORPHYRY PROJECTS IN MONGOLIA, PRIVATE PLACEMENT AND APPOINTMENT OF NEW DIRECTOR
Five Star Diamonds Ltd. (TSXV: STAR) is pleased to announce that it has entered into agreements to acquire a 100% interest in two highly prospective porphyry copper projects in southern Mongolia through a combination of work programs, deferred cash payments and the issuing of STAR shares.
The Company has the rights to acquire a 100% interest in the 150 square kilometer Baruun Tal Copper Project located in in the World Class South Gobi Porphyry Copper Province. The Baruun Tal Copper Project was last explored by Ivanhoe Mines in 2007 and no exploration has been undertaken since that time. The area remains under explored and highly prospective. Exploration results from Ivanhoe Mines soil, rock chip and trenching programs are early stage and results are extremely encouraging and show the potential for the possible discovery of a copper porphyry copper system. Early rock chip sampling returned results up to 14.5% copper and trenching results returned a best result of 22 meters at 0.8% copper.
Source: JuniorMiningNetwork.com
ASPIRE MONGOLIAN COAL PLAY TO MAKE AUD 279M A YEAR
ASX-listed and Mongolia focussed metallurgical coal developer, Aspire Mining, says its Ovoot Early Development Project, will pump out a stunning annual EBITDA of AUD$279m from the production of 4 million tonnes a year of sought-after “fat” coking coal for delivery into China.
The company this week provided an update to its prior pre-feasibility study mine plan and costings for the “extended case” option for the project.
With significant reductions in both capital and operating costs identified, the new PFS has delivered an improved financial outcome compared to results from earlier this year.
Significantly, Aspire has reduced its projected capital costs for the project by 34% to AUD$45.1m off the back of lower mining and deferred capitalised waste removal costs.
The C1 cash costs have fallen to AUD$110 per tonne delivered to the Chinese border, mainly due to a 19% reduction in the mine operating costs that have dropped to AUD$38.40 per tonne over the initial 12.5-year life of the mine.
Source: The West Australian
LEGAL OPPORTUNITIES TO DEFER AN ARBITRATION HEARING
As provided in the Procedure for Arbitration proceeding of the Mongolian Chamber of Commerce and Industry, the Parties are entitled to submit the request on the deferral of the hearing only on the grounds stated in law or justified reasons.
The Law on Arbitration does not provide an interpretation on what occasions shall be deemed as the justified reasons. However it may include the instances such as being sick, getting a medical treatment, taking care of a sick person, having a business travel inland or abroad, taking part in the training, joining the public mobilization, to be imprisoned in zone of public quarantine due to serious contagious disease, sudden fire and natural dangers or force majeure events (flood, drought, zud, dangerous snow and dust storms, earthquake, etc.).
Moreover, pursuant to the Procedure for Arbitration proceeding stipulated, if the Arbitration composition may defer the arbitration hearing if they deem that new evidences are required.
Source: LehmanLaw Mongolia
XANADU MINES UPGRADES COPPER AND GOLD EXPLORATION TARGET AT KHARMAGTAI PROJECT
Xanadu Mines Ltd has upgraded the global copper and gold Exploration Target at its flagship Kharmagtai project in the south Gobi region of Mongolia.
The new global Exploration Target has been developed to highlight the large-scale copper-gold potential of the Kharmagtai project.
Additionally, an independent valuation has been completed by SRK for the Kharmagtai Mining Lease.
Xanadu managing director and chief executive officer Dr Andrew Stewart said: “We have always had a strong belief in the large-scale copper-gold potential of Kharmagtai.
“This Global Exploration Target outlines the areas we are aiming to convert to resources in the near to mid-term.
“Additionally, our geologists have highlighted a series of compelling geochemical and geophysical vectors which suggest mineralisaiton within this Exploration Target is just the tip of a much larger porphyry system.
Source: Proactive Investors
CORPORATE LAW: THE SECRETARY OF THE BOARD OF DIRECTORS
The Secretary of the Board of Directors is deemed as the company’s eligible person.
Because he/she is involved in the official decision of the company in both direct or indirect ways. This is regulated in Article 84.1 of the Company code. The Secretary of the Board of Directors shall be appointed by the BoD upon the suggestion submitted by the Head of BoD.
Any person of the state and regional administrative bodies, military, police, court and prosecutor’s authority, or any person currently convicted to criminal penalty are prohibited to act as the Secretary of the Board of Directors. (Article 84.3 of the Company Code)
The Article 75.8 of the Code also provides the Secretary of the Board of Directors to be enrolled in the corporate governance training and to have received the Certificate thereof. This requirement applies to the members and secretaries of the BoDs of joint stock and limited liability companies.
Source: LehmanLaw Mongolia
LOCALS LEARNING FROM LOCALS IS A HIT IN MONGOLIA
The keys to holding a successful NOG event is open communication and productive collaboration among the organizing team.
This was the opinion of Tugsorshikh Badarch, one of the very satisfied members of the mnNOG Coordination Committee, who recently organized Mongolia’s first Network Operators Group meeting, mnNOG 1.
Held in the capital, Ulaanbaatar, from 16 to 21 September, the one-day conference and five days of workshops attracted more than 170 attendees; a result that exceeded the Coordination Committee’s wildest expectations, given the concept of a NOG was new for a relatively fledgling operational community.
“We had a sudden influx of last-minute registration requests as the word spread and had to close the registration days before the conference date,” said Tugsorshikh.
“Perhaps more pleasing was how active and confident the community was asking questions from and providing feedback to our international and local speakers. It was something we weren’t sure they would ‘get into’ given the less than cooperative culture between the attendee’s organizations.”
Source: APNIC.net
DID CHANGING SENTIMENT DRIVE MONGOLIA ENERGY'S SHARE PRICE DOWN A PAINFUL 84 PCT?
Long term investing works well, but it doesn't always work for each individual stock. We really hate to see fellow investors lose their hard-earned money. Spare a thought for those who held Mongolia Energy Corporation Limited (HKG:276) for five whole years - as the share price tanked 84%. Shareholders have had an even rougher run lately, with the share price down 13% in the last 90 days.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
Mongolia Energy isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. When a company doesn't make profits, we'd generally expect to see good revenue growth. That's because it's hard to be confident a company will be sustainable if revenue growth is negligible, and it never makes a profit.
Source: Yahoo Finance
IMAGINE OWNING TURQUOISE HILL RESOURCES AND TRYING TO STOMACH THE 86 PCT SHARE PRICE DROP - EDITORIAL
Every investor on earth makes bad calls sometimes. But you have a problem if you face massive losses more than once in a while. So spare a thought for the long term shareholders of Turquoise Hill Resources Ltd.; the share price is down a whopping 86% in the last three years. That would certainly shake our confidence in the decision to own the stock. And more recent buyers are having a tough time too, with a drop of 78% in the last year. Shareholders have had an even rougher run lately, with the share price down 19% in the last 90 days.
We really hope anyone holding through that price crash has a diversified portfolio. Even when you lose money, you don't have to lose the lesson.
There is no denying that markets are sometimes efficient, but prices do not always reflect underlying business performance.
Source: Yahoo Finance
REDPATH USES ITS GLOBAL EXPERIENCE TO MEET OT UNDERGROUND CHALLENGE - INTERVIEW
Redpath Mongolia is celebrating the completion of 15 years of presence in Mongolia. Its biggest responsibility here has been the lateral development of the Oyu Tolgoi underground mine, and Scott Hayne, Executive Director, tells MMJ about the challenges that have cropped up and how he is confident that the company’s wide experience will lead it to success, with the help of a skilled and motivated Mongolian workforce.
Your company is well known in the global mining industry. How important are your Oyu Tolgoi operations in terms of your total responsibilities? What are some other global projects that you now have?
Redpath is currently involved with over 90 projects globally, spanning 13 countries. Our employee base in Mongolia accounts for just over 15% of Redpath’s workforce worldwide.
Our work includes mine development, underground construction, shaft sinking, engineering and technical services, raiseboring, and contract mining. Global experience has given Redpath regulatory knowledge, regional experience, and cultural sensitivity.
Source: Mongolian Mining Journal
B.ARTAGBAT: “MINE CLOSURE 2020” TO BE HELD IN MONGOLIA - INTERVIEW
Qualified Mining Consulting has been awarded the right to organize the 14th International Conference on Mine Closure in Mongolia. We talked with B. Artagbat, Executive Manager of the organizing committee.
-Can you introduce the international conference on mine closure to our readers?
-First of all, it’s a great pleasure to officially announce that QMC LLC who provides professional services to the mining sector has been awarded, under its initiative to contribute to the development of responsible mining, the organizing rights to the 14th International Conference on Mine Closure in Mongolia to be held in 2020 and that preparations are already underway.
QMC has had considerable experience through attending the international conference since 2009 and presented at 2015, 2016 and 2018 conferences. To spread international best practices across Mongolia, we have been participating in and co-organizing conferences, forums, and practical training in the field of environmental protection, rehabilitation, and closure in the mining sector since 2010.
Source: AsiaMining.mn
