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A bloc of lawmakers from Mongolia's ruling political party called on the prime minister to resign Wednesday, accusing him of abusing his position by allegedly handing government contracts for roads and other projects to politically connected businesses.
The 30 members of the State Great Hural from the Mongolian People's Party alleged in a statement Wednesday that Jargaltulga Erdenebat violated parliamentary procedure by signing seven contracts worth the equivalent of about $328 million.
Erdenebat, in office since 2016, is also accused of distributing millions of dollars in cash payments to families with children ahead of a presidential runoff election on July 7, in an apparent attempt to win votes for the ruling party's candidate, who lost.
"It's time to clean up the Mongolian government," said Garamjav Tseden, a wealthy businesswoman and MPP lawmaker. "I'm not standing against the government because of my personal interest," she said.
The MPP has 65 seats in the 76 member Great Hural, with the opposition Mongolian Democratic Party and independents sharing the remainder. Opposition lawmakers are expected to support the resignation demand, which can be followed by a vote of no confidence if the prime minister refuses to leave.
Mongolia, a landlocked country of 3 million, boasts vast mineral wealth but has struggled in recent years to court foreign investment due to plunging commodity prices and high-profile disputes between the government and large investors such as mining giant Rio Tinto.
The government has also been weighed down by a national debt of about $23 billion, or twice annual economic output, and recently obtained a $5.5 billion bailout led by the International Monetary Fund.
In July, Mongolia elected populist business tycoon and ex-judo champion Khaltmaa Battulga of the Democratic Party as its new president. He edged out his establishment opponent, Miyegombo Enkhbold of the MPP, in the runoff election.
The contracts called into question are for roads and power transmission equipment, including substations for the mining industry. Companies granted the contracts include ones connected to the families of three members of the Cabinet. Other beneficiaries include MPP politicians, among them Erdenebat, who received funding to build roads in his constituency.
Erdenebat could not immediately be reached for comment and calls to the government spokesman's office rang unanswered on Wednesday.
Dale Choi, an analyst at Altan Bumba Financial Group, said the fate of the prime minister should have little impact on the IMF bailout or plans to drive the economy.
The move to oust Erdenebat appeared to be part of "deck clearing" following the MPP's loss in the presidential election, while his likely replacement could show bolder leadership on the economy, Choi said in a research note.
"In short term, Gov't of Mongolia instability will not be comforting to investors, but in longer term it actually healthy development for MPP," he said. The party "desperately needs at this stage to reinvent its image and reform" and distance itself from corruption, he said....
The Sainshand wind farm in Mongolia, the third privately financed wind farm in the country, will receive a US$ 120 million project financing package from a group of international investors and financiers.
Located 460 km south-east of Ulaanbaatar in the Gobi Desert, Sainshand Salkhin Park LLC is sponsored by French energy leader ENGIE, German project developer Ferrostaal, Danish Climate Investment Fund (DCIF) and Mongolian entrepreneur, Radnaabazar Davaanyam, with long-term financing provided by the European Investment Bank (EIB) and the European Bank for Reconstruction and Development (EBRD).
The lenders have agreed to provide a total project financing of US$ 78.5 million, which comprises EIB funding of US$ 47 million, of which the first tranche will be guaranteed by EKF, Denmark’s Export Credit Agency, with NORD/LB acting as agent; and EBRD funding of US$ 31.5 million.
Once operational, the new Sainshand wind farm will make a significant contribution to reducing Mongolia’s carbon emissions and cater for an expected increase in power demand in the country. The scheme will significantly enlarge Mongolia’s renewable energy capacity and help the government to achieve the goal of renewable energy accounting for 20 per cent of all power by 2020, and 30 per cent by 2030.
The Sainshand wind farm will be built by China Machinery Engineering Corporation (CMEC) as the engineering, procurement and construction (EPC) contractor, and will use 25 Vestas V110 2.2 MW turbines to deliver up to 55 MW of clean energy that will save an estimated 200,000 tonnes of carbon emissions. Construction at the site is expected to start later this summer and be completed before the end of 2018. It follows three years of wind surveys to measure the high-yield winds in the area. The average wind speeds per second at the site are ideal for onshore wind energy.
The project has been developed in consultation with the local communities and a detailed environmental impact assessment has been approved by the relevant national authority. Financing has been agreed following preparation of a comprehensive environmental and social management system compliant with international standards such as those of the EBRD, EIB, International Finance Corporation (IFC) and the Equator Principles.
ENGIE will build and operate the Sainshand wind farm in Mongolia, its first renewable project in the country, located in the Gobi desert. This project, which is the third privately financed farm in Mongolia, will support the government’s objective to evolve towards a greener economy and a better environment. A USD 120 million project financing package has recently been signed by a group of international investors and financial institutions to develop the project.
The Sainshand wind farm will have a total installed capacity of 55 MW and will provide the equivalent of the electricity consumption of 130,000 people in Mongolia. Construction – which will be overseen by Tractebel, ENGIE’s engineering arm – will start this summer, with commissioning of the plant in the second half of 2018.
Once operational, the farm will make a significant contribution to reducing Mongolia’s carbon emissions and cater for expected increased power demand in the country. The scheme will enlarge Mongolia’s renewable energy capacity and help the government to achieve its goal of renewable energy representing 20% by 2020 and 30% of all power by 2030.
Paul Maguire, CEO of ENGIE Asia-Pacific, said: “ENGIE’s ambition is to provide energy access-for-all through clean and renewable energy sources, especially to developing communities. Mongolia is facing an energy challenge due to increasing demand from industrialization and urbanization. As our first renewable energy project in Mongolia, ENGIE’s investment in the Sainshand wind farm is consistent with our vision of leading the global energy transition, and the drive for decarbonisation will significantly contribute to powering the country’s energy needs in a sustainable way.”
The Sainshand wind farm, located 450 km south-east of Ulaanbaatar nearby the Sainshand City, capital of Dornogobi Province, will boost the local and national economy through job creation, fiscal contributions and the supply of clean energy.
The project has been developed in consultation with local communities and a detailed environmental impact assessment has been approved by the relevant national authorities. Financing has been agreed following preparation of a comprehensive environmental and social management system compliant with international standards such those of the EBRD, EIB, International Finance Corporation (IFC) and the Equator Principles.
The ENGIE Group is the largest independent electricity producer in the world with 112.7 GW of installed capacities, of which 20% from renewables. It aims to reach a 25% contribution from renewables to its global energy generation portfolio in 2020.
ULAANBAATAR (Reuters) - Mongolia is working to clear up delays at the Chinese border that have disrupted trade and created a traffic jam of coal trucks stretching more than 100 km (62 miles), the country's foreign ministry said during a press briefing on Wednesday.
The landlocked northeast Asian country has become one of China's biggest coal suppliers this year following a ban on imports from North Korea and restrictions on deliveries to some smaller Chinese ports.
But a backlog led to the queue of trucks on the main road to China, with customs clearance at the Gants Mod border crossing said to be taking as long as a month, up from the normal period of two weeks, according to Mongolia's official Montsame news agency.
"There was a problem at the border, so at the end of July and beginning in August, there were 400 to 500 trucks passing through the border gate," said D. Davaasuren, state secretary for the Ministry of Foreign Affairs, at the briefing, without giving more detail.
Davaasuren said Mongolia had discussed the matter with Chinese officials and around 990 trucks entered China from Mongolia on Tuesday, closer to normal levels.
Last week, the country mobilized to improve carrying capacity at border checkpoints and also promised to negotiate with Chinese officials to ease the bottleneck, Montsame reported.
Coal trucks were forced to wait two or three days before they were even permitted to unload for inspections at the border, according to the website of Chinese industry consultants sxcoal.
Though Mongolia is currently upgrading its detection equipment at border crossings, an official familiar with the situation rejected claims that the delays were caused by technical problems. The official said operations at the border might have been disrupted as a result of lower staffing levels during Mongolia's traditional summer Naadam festival.
China's General Administration of Customs said on Wednesday that 2.26 million tonnes of non-lignite Mongolian coal were imported in July, up 32.4 percent from a year ago.
Mongolia has been China's third-biggest source of coal imports over the first seven months of this year, with total shipments reaching 20.85 million tonnes, up 73 percent compared to last year.
With a long-awaited railway connection still unfinished after investment dried up, all coal from mines in Mongolia's Umnugovi province abutting China are delivered to the border via one single highway, making it vulnerable to disruptions.
Exporters of other commodities have not reported any issues at the border. Copper shipments from the Oyu Tolgoi mine run by Anglo-Australian miner Rio Tinto, which uses the same road and border crossings for exports, have not experienced any new delays, an official at the mine told Reuters.
BEIJING, Aug 23 (Reuters) - Chinese coal imports from neighbouring Mongolia jumped over 30 percent in July from the year before to 2.26 million tonnes, customs data showed on Wednesday.
Cargoes from key supplier Australia rose 4.4 percent to 7.47 million tonnes, according to the data from the General Administration of Customs.
Meanwhile, shipments from Indonesia dropped by nearly 9 percent to 3.03 million tonnes. Imports from Russia fell 1.7 percent to 1.64 million tonnes, the data showed.
(Reporting by Meng Meng and Beijing Monitoring Desk; Editing by Joseph Radford)
When you visit a mining company’s website and click on “projects,” you’ll usually see at least one operating mine and several exploration and discovery projects featured.
Under the “projects” menu for Turquoise Hill Resources (TSX, NYSE, Nasdaq:TRQ), there is a single asset – Oyu Tolgoi.
But what an asset.
In terms of sheer scale and ore quality, the Oyu Tolgoi (which means “turquoise hill” in Mongolian) is expected to be the world’s third-largest copper mine when it reaches peak production, and has an expected mine life of close to a century. Which explains why Turquoise Hill has no other exploration projects in its pipeline.
“If I have the best undeveloped copper project in the world, I don’t necessarily want to go and develop a project – like we’ve been offered in Peru – that’s one-fourth the grade,” said Turquoise Hill CEO Jeffery Tygesen. “Oyu Tolgoi is a Tier 1 asset, and they come by about every 20 to 25 years.”
The massive Oyu Tolgoi copper-gold mine is situated in Mongolia; the man responsible for making it a reality, Robert Friedland, is an American who lives in Singapore; and the majority shareholder of Turquoise Hill, Rio Tinto PLC (NYSE:RTP), is a multinational mining company headquartered in the U.K. But the Oyu Tolgoi is very much a Vancouver mining success story.
The company is still headquartered in Vancouver even though Rio Tinto owns 50% of the company. That’s largely a legacy of Turquoise Hill having been spun out of Friedland’s Ivanhoe Mines (TSX:IVN), which was and still is based here.
Turquoise Hill’s growth since 2012 has earned it fifth place in Business in Vancouver’s list of the 100 fastest-growing companies in B.C. With a market cap of $8 billion, Turquoise Hill is B.C.’s fifth-largest mining company.
The company’s revenue grew 1,943% in four years, from $78 million in 2012 to $1.6 billion in 2016, and its head count has swelled, contracted and swelled again, with the construction phases of an open-pit mine followed by the construction, now underway, of an underground mine.
At the end of 2012, the company employed 4,069 people, a number that dropped to 2,530 in 2016 and hit 6,200 by the end of June 2017.
Almost all of those workers are in Mongolia. The company’s Vancouver head-office staff numbers only about half a dozen.
The mine’s estimated copper reserves are 3.4 billion tonnes – and it’s not just high-grade copper coming out of the ground. Rick Rule, president of Sprott U.S. Holdings Inc., has called the Oyu Tolgoi “a very large gold producer in drag” because it is primarily a copper mine that also has a lot of gold.
In 2016, copper production was 201,000 tonnes, and gold production was 300,000 ounces. The anticipated peak production is 622,000 tonnes of copper and 650,000 ounces of gold. To put that in perspective, the largest open-pit copper mine in Canada – the Highland Valley mine near Princeton, B.C. – produced 152,000 tonnes of copper and molybdenum in 2015.
Oyu Tolgoi not only has high grades of copper and gold, but is also just 80 kilometres from the border with China, which accounts for 50% of global copper consumption.
The property was discovered in the early 1990s, when Mongolia had just shaken off communism and moved to a market economy. Friedland acquired it in 2001, and Rio Tinto became a major partner.
In 2012, Rio Tinto raised its stake to 50%, and Turquoise Hill was hived off from Ivanhoe with the express purpose of building and operating the Oyu Tolgoi mine. Friedland is no longer involved in the company but remains one of the top 10 shareholders.
Rio Tinto has no direct ownership in Oyu Tolgoi. It owns 50.8% of Turquoise Hill. Turquoise Hill owns 66% of the Oyu Tolgoi mine, and the Mongolian government owns 34%.
The company spent $6.2 billion on the first phase of the project, building the open-pit mine, concentrator and associated infrastructure.
“Backing up to construction, when we started, there was nothing in the south Gobi,” Tygesen said. “We had to build the infrastructure. There was no paved road to the border.”
The open-pit mine went into production in 2013. Last year, work began on the mine’s $5.3 billion second phase. The new underground mine is slated for commissioning in 2020 and full production in early 2027.
“When we get to 2025, Oyu Tolgoi will be the third-largest copper mine in the world,” Tygesen said....
Ulaanbaatar /MONTSAME/ P.Sergelen, Minister of Food, Agriculture and Light Industry, met Tuesday a delegation headed by His Highness Abdullah Bin Abdulrahman Bin Abdulaziz Al Saud, Prince of Saudi Arabia.
The Minister thanked the Saudi Arabia Prince for visiting Mongolia, and then briefed about the present situation of the agricultural sector in Mongolia and further development.
Mr Sergelen said the government of Mongolia is implementing some programs in the fields of food, agriculture and light industry such as the First Campaign for Meat and Milk, “Industrialization 21:100” and the Third Campaign for Reclaiming Virgin Lands under a slogan “Healthy foods-Healthy Mongolian”. Maximizing the meat export is one of the goals within the First Campaign for Meat and Milk.
The Minister pointed out that Mongolia and Saudi Arabia are possible to cooperate in the agricultural sphere.
“Mongolia has vast reserve of meat and is capable to export meat and livestock. It has been estimated that the country is able to 150.4 thousand tons of meat a year. As of the previous year, the number of livestock reached 61.5 million heads,” Mr Sergelen said. He then put forward a proposal to the Saudi Arabia side to build a joint meat processing factory.
Emphasizing that Saudi Arabia has big consumption of meat, His Highness proposed to set up a working group on establishing the joint factory.
At the end of the meeting, His Highness invited the Minister to pay an official visit to Saudi Arabia.
On August 21, MP and Minister of Foreign Affairs Ts.Munkh-Orgil met with Minister of Natural Resources and Ecology of the Russian Federation, Mr.D.Donskoy in Moscow, exchanging views on bilateral cooperation policy and current issues. They are also heads of Mongolian and Russian parts of the Mongolian-Russian Intergovernmental Commission on Trade, Economic, Scientific and Technical Cooperation.
The parties expressed their appreciation that in the first half of this year, the bilateral trade turnover increased by 32 percent, reaching to USD561 million and underlined that there is great potential to increase trade in chemical, metallurgy, machinery, equipment, and textiles.
During the meeting, the parties agreed to organize the 21st regular meeting of the intergovernmental commission in the second half of October 2017, holding meetings of sub-commissions including agriculture, environment, transportation and regional sub-commissions and working groups in nearest future. The parties talked about collaboration in organizing Mongolian Prime Minister's visit in the fourth quarter of this year.
The preparation works regarding a working visit of the President of Mongolia to the Russian Federation on September 6-7, 2017 and participation in the Eastern Economic Forum were also discussed during the meeting, expressing their views on the agenda of the visit and the documents to be established.
Delegations of the President’s visit will include Minister of Road and Transportation Development D.Ganbat, Minister of Food, Agriculture and Light Industry P. Sergelen. Therefore cooperation issues of those sectors were also touched during the Foreign Minister Ts.Munkh-Orgil’s meeting. For example, they talked about preparations for the supply of vaccines against infectious diseases from RF within the second phase of the "Mongolian Livestock Program" and buying wheat and hay. The sides also finalized the draft of an intergovernmental agreement between Mongolia and RF on “Conditions of Rail freight transportation”, agreeing to seek possibilities to sign the agreement during the Presidential visit.
The sides expressed their satisfaction with the current level of tripartite cooperation and confirmed their interest to set up an Investment projection center in Ulaanbaatar in order to activate the cooperation, within the framework of the program on the establishment of Economic Corridor between Mongolia, Russia, and China.
FESCO Transportation Group (“FESCO”,”Group”) announces launching of FESCO Silk Way Shuttle ‒ scheduled container train at the route China-Europe-China. It is the first FESCO’s inland transit service at this direction.
The first train departed from Chinese city of Zhengzhou to German Hamburg on August 5, it is scheduled to arrive to the destination on August 20. 42 containers with consumer goods, spare parts, equipment and food products were shipped from China to Europe. The train crosses China, Mongolia, Russia, Belorussia, Poland and Germany. The border between Mongolia and Russia will be crossed at Naushki border guard point.
FESCO Silk Way Shuttle will operate on a weekly basis in both directions. First shipment from Germany is scheduled for August 18. The service is oriented first of all on the cargo sensitive to the speed of delivery. Transit time between China and Europe is 13-15 days, which is three-fold shorter than the shipment by deep sea via Suez Canal.
The start of the new service expands geography of FESCO operations, and also the range of services that the Group offers to clients. This is the first FESCO scheduled onshore transit route from China to Europe; it complements the line of intermodal services operated at the Far East. In the long term the Group plans to ramp up volume of transportation of FESCO Silk Way Shuttle, by increasing frequency of shipments up to two trains per week in each direction, and also by organizing new railway services via Naushki railway station.
As recently as 1999, investors seeking a 6 percent yield on a government bond could have bought 10-year U.S. Treasuries. These days they can’t even get that from Mongolia.
Central-bank bond buying has compressed yields in developed markets to unprecedented levels, pushing investors further down the risk spectrum in a hunt for higher returns. Yields on Mongolian dollar bonds maturing in 2021 fell below 6 percent for the first time on record late last month after dropping 3.5 percentage points this year.
Yields on 2019-maturity Ukrainian debt and seven-year Belarussian bonds issued in June have also moved below 6 percent in the past two months. All three former Communist nations have a Bloomberg Composite rating of CCC+, or seven levels below investment grade. In a Bloomberg index of emerging-market sovereign dollar debt, only El Salvador, Barbados and Venezuela are rated lower.