Khuvsgul Province begins manufacturing milk powder www.theubpost.mn

Ikh Uul soum in Khuvsgul Province opened Mongolia’s first mobile factory for milk powder on June 24 through a campaign for meat and milk production, launched in January 2017 by the Ministry of Food, Agriculture and Light Industry.

Exclusive: Dropbox seeks to hire IPO underwriters - sources www.reuters.com

Data-sharing business Dropbox Inc is seeking to hire underwriters for an initial public offering that could come later this year, which would make it the biggest U.S. technology company to go public since Snap Inc (SNAP.N), people familiar with the matter said on Friday.

Mongolia exports 4000 tons of meat to Iran www.montsame.mn

Ulaanbaatar /MONTSAME/ Mongolia has started exporting meat to Iran in the frames of ‘Meat and Milk Campaign I’.

Top 3 coal countries produced 6% more coal from January to May www.mining.com

Just when you thought coal was out, the fossil fuel appears to be back on the burner.

Relationship With China Looms Large in Mongolian Election www.theepochtimes.com

After an inconclusive vote in Mongolia’s June 26 presidential election, candidates from the north Asian country’s two most prominent political parties will face off in a second round on July 7.

Mongolia’s relationship with China, particularly regarding its economy, has been a major topic in the election. Ninety percent of Mongolia’s exports go to its southern neighbor, with the main export products being coal and minerals including gold and copper. China wants to invest in infrastructure to mine and move these exports quicker, but can only do so if allowed by the Mongolian government.

Battulga Khaltmaa, candidate for the conservative-leaning Democratic Party and former transport minister, has expressed concern about growing Chinese economic involvement in Mongolia.

In an emailed statement to Reuters, Battulga said that while China “must be a great partner of [Mongolia]”, “rail and transportation for any country is both a national security and an economic issue”.

When resources run out, “there will definitely be conflict between the Mongolians and the Chinese”, he said in a 2014 interview.

Enkhbold Miyegombo of the ruling Mongolian People’s Party is less suspicious of Chinese motives for investment.

The People’s Party was once known as the Mongolian People’s Revolutionary Party (MPRP) and served as the Soviet-backed communist regime in Mongolia from the 1920s to the end of the Cold War. The MPRP of today split off from the People’s Party and was represented in the initial vote by candidate Ganbaatar Sainkhuu.

According to one party official in a Reuters interview, he is “open to foreign investment from all countries, that of course includes investment from China”.

The official also said that “the reality for today is we have the supply, China has the demand,” but added that Mongolia needed to diversify and “reduce inappropriate dependence” on one country.

There have been several political conflicts between the two countries in recent years. About a week after the exiled Tibetan religious leader, the Dalai Lama, visited Mongolia in 2016, China reportedly closed an important border crossing that left hundreds of truck drivers stuck at the border for hours and even days.

Al Jazeera reported that a loan deal Mongolia was negotiating with China to ease its financial situation had been cancelled by China, also because of the Dalai Lama’s visit. Mongolia is “paying a very heavy economic price for putting religious freedom ahead of economic necessity,” Al Jazeera reported.

A 2014 agreement with China’s Shenhua Group was blocked by the Mongolian parliament the following year because of disputes about the width of the track. According to a Business News Europe report, then-transport minister Battulga argued that “tanks can easily penetrate into Mongolia in no time if we build a railway with a [narrower] gauge track, the same used in China.”

In the initial vote on June 26, Battulga won 38.1 percent, while the People’s Party’s Enkhbold won 30.3 percent. Ganbaatar Sainkhuu of the Mongolian People’s Revolutionary Party gained 30.2 percent.

List of new laws taking effect in July www.montsame.mn

Starting from July 1, following laws will come into effect.

Criminal Code /Revised version/
Criminal Procedure Code /Revised/
Law on Offence /Revised/
Offence Procedure Law /Revised/
Law on the Elderly /Revised/
Law on Social Welfare Allowance for the Elderly with State Merit /Revised/
Law on Youth
Law on Auto Road /Revised/
Maritime Law /Revised/
Law on Decision of Civil Cases in the Court /Revised/
Law on Prosecutor /Revised/

"Mongolia have probably the biggest gold resources globally" www.miningmetalnews.com

Already on 10 February 1922, the People’s Government of Mongolia signed a landmark resolution that brought a significant coal deposit in Nalaikh city under state control. By the end of the year, exploration on the deposit was complete, ushering in what is today considered the birth of the mining sector in the country.

In the 96 years that have followed, the mining industry has undergone a number of transformations as its role in Mongolia’s economy has steadily grown into one of its leading sectors of growth, responsible for producing 21 percent of its GDP, 70 percent of its total industrial output and 90 percent of its export product.

Coal, copper and gold form the principle reserves that are mined in abundance across Mongolia. The country hosts approximately ten percent of the world’s known coal reserves at an estimated 162 billion tonnes.

It took Mongolia a while to shake down since shaking off Soviet influence in 1990 and ceasing to call itself a people's republic, but today this huge, sparsely populated country is democratic, peaceful and stable. Its readily accessible mineral wealth has started to attract major mining companies seeking new resources and with copper and gold prices firming up following a four-year downturn.

Since it floated on the Australian Stock Exchange in May 2010, the Australian exploration company Xanadu Mines has been single-mindedly pursuing its goal of adding value to its properties in the South Gobi district of Mongolia.

Its Managing Director and CEO Dr Andrew Stewart has long held the view that Mongolia had the edge on other comparable regions:

“We like Mongolia because it is a very under-explored exploration location, even though it has been shown to host some of the biggest copper deposits in the world,” adds Stewart.

He points for evidence to Rio Tinto's massive Oyu Tolgoi project, only 100 kilometres from Xanadu's flagship Kharmagtai project in the south of the country. With the cost of bringing it into production estimated at close to $10 billion, the Oyu Tolgoi mining project represents the largest financial undertaking in Mongolia’s history.

“Mongolia is God's gift to explorers! A junior company like Xanadu can explore relatively cheaply,” he says.

There are comparable reserves in the world, but most of these are located in remote jungle, at high altitude, places with high rainfall or, like the beleaguered Grasberg mine in Indonesia, beset with political disruption.

While Xanadu's peers are drilling at a cost of up to $600 a metre, Xanadu's costs come in at around $100, thanks to the open nature of the terrain plus the fact that all of the roads, power, water and other services that are required are already in place.

“Particularly at Kharmagtai, this is the benefit gained from the infrastructure that goes in when one of the world's biggest mining companies builds a tier one asset next door to our project,” he admits.

All three projects that Xanadu is developing are in highly prospective deposits. The gold element is a critical differentiator between these Mongolian resources and others in South and Central America for example.

“These porphyry copper resources we see in Mongolia are probably the biggest gold resources globally,” he says.

These are precisely the type of deposit that the major mining companies are turned on by at a time when there is a scarcity of new resources on the one hand while on the other global economic uncertainties are encouraging investors to take refuge in gold.

Kharmagtai, with a 30-year mining licence and a registered water resource, is the most active currently, and he estimates that it will take another year to define.

The deposit starts at the surface, giving the opportunity for early production upside from an open pit, but in the longer term there is a great deal more value deeper down. Xanadu’s local drilling contractor Litho Resources has already gone down 650 metres, with some excellent intercepts, but by mid-2018 he expects it to reach as far as a kilometre.

The demand for copper from Japan, China and Russia, with ready logistical access to all of these markets, boosted by the global thirst for gold, will make Xanadu Mines a tempting target for the majors, though the company does not by any means rule out the possibility that the they might build its own mines either alone or in partnership.

Japan's Megabanks Vie for Top Role as Backers of Clean Energy www.bloomberg.com

Mitsubishi UFJ Financial Group Inc. and Mizuho Financial Group Inc. are in a neck-and-neck race to be the biggest lead arrangers of lending to the renewable energy industry in the first half of the year, highlighting the more active financing role for Japanese banks in clean energy.

Tokyo-based MUFG has the edge over Mizuho in writing project finance loans to clean-energy developers for the period, according to data compiled by Bloomberg New Energy Finance. As of Thursday, MUFG was credited with $1.697 billion of asset financing, compared with $1.662 billion for Mizuho, the BNEF data show.

Japan’s support for renewables since the Fukushima disaster in 2011 and the search for steady yields outside the country have helped push the nation’s lenders into the top tiers among their global rivals. In 2011, only MUFG was in the top five lenders exposed to asset finance deals in clean energy, according to BNEF. Last year, three of the five biggest lenders were Japanese.

“Japan’s megabanks have been expanding on the back of heightened interest in renewables such as solar after the earthquake and tsunami in Tohoku,” said Takashi Miura, an analyst at Credit Suisse Group AG in Tokyo. “And they’re also doing more because they can secure relatively good margins.”

MUFG’s focus on lending to solar, wind and geothermal projects in the first half has helped solidify its hold on the top position among global financial institutions that it assumed last year when it passed Banco Santander SA. Mizuho, which was fifth in lending to clean-energy developers in 2016, is aiming to challenge MUFG with a push beyond solar and wind into other areas such as biomass.

“Mega solar has been our focus since 2012,” Toshikazu Tanaka, head of the project finance team at Mizuho, said in an interview at the bank’s Tokyo headquarters. “The business environment for power producers is changing and solar may not expand as much as it did before. We will work on expansion into new fields.”

Solar Cuts

Mizuho’s focus on other clean-energy sources comes after tariffs for solar power producers in Japan dropped by nearly half since 2012 to 21 yen a kilowatt-hour this year. A change in government backing is also underway since the introduction of new rules in April, with photovoltaic projects of 2 megawatts in capacity or larger now subject to auctions.

In February, Mizuho provided a $586.5 million loan for a wind portfolio in Texas and Oklahoma, the largest loan the bank provided so far this year, according to BNEF data. Mizuho was the sole lender to the 700-megawatt projects sponsored by Duke Energy Corp., according to the bank.

“The ratio of renewables in global power demand is steadily increasing and clean energy is also expanding outside developed countries,” Kazunobu Takahara, a spokesman for MUFG said. “We will continue our active financing for renewables projects.”

As for Mizuho, five of the 11 projects it financed were for solar projects in Japan this year as of Thursday. The bank also funded two photovoltaic stations in the U.S. and the 80-megawatt Muara Laboh geothermal plant by Engie SA, Sumitomo Corp., and PT Supreme Energy.

Mizuho is betting on continuing developments of offshore wind projects in Europe, according to Toru Miyabe, head of the power team at the bank’s global project finance department. 

Currently, offshore wind capacity totals more than 13 gigawatts worldwide, with nearly 90 percent of installations in Europe. Offshore capacity is expected to reach 174 gigawatts by 2040, according a BNEF forecast released on June 15.

Rio Tinto shareholders greenlight sale of Aussie coal assets to Yancoal www.mining.com

Rio Tinto (ASX, LON:RIO) shareholders have backed management on the decision to sell the firm’s Australian coal assets to China-backed Yancoal Australia (ASX:YAL) for $2.69 billion, ending a three-week bidding war with Glencore.

200 parking spaces on Sukhbaatar square open www.montsame.mn

Ulaanbaatar /MONTSAME/ On June 29, a 200-car parking space was put into operation on the south side of the central square of the capital-the Sukhbaatar Square, with a view to reduce traffic congestion in the central area of the city and create a comfortable environment for citizens, domestic and foreign tourists and travelers.