Oyu Tolgoi released its latest performance scorecard, highlighting key performance metrics for the third quarter of 2021, providing an update on the underground development and its ongoing COVID-19 control measures.

We continue to prioritise the health and safety of our employees and the local community, transparently cooperating with the Government of Mongolia, Emergency Commissions of Umnugovi province, Khanbogd soum and other relevant stakeholders implementing the necessary preventive measurements. We recently donated MNT570 million to the Ministry of Health to purchase 1,000 oxygen concentrators essential for emergency care during the COVID-19 pandemic.

Chief executive officer of Oyu Tolgoi, Armando Torres, said, “I am proud of our miners building a world-class mining operation in Mongolia’s South Gobi and what we have achieved during this unprecedented time. Recently, we have reached the important milestones of celebrating the 10-year anniversary of the open pit mine, completing the breakthrough of the conveyor to decline - the largest tunnel on site that allows direct access from surface to the underground. Our teams have delivered these outstanding milestones safely and successfully, a true testament to the commitment and skills of our talented Mongolian workforce. The next major task that we all have in front of us is the commencement of the undercut. We will commence caving operations as soon as the required criteria are achieved so that we will be able to deliver the full benefits of Oyu Tolgoi to our stakeholders, including the people of Mongolia.”

In the third quarter, stringent Chinese border restrictions continued due to increased cases of COVID-19 in Mongolia. Force majeure declared on shipments on 30 March remains in place, as we continue to work closely with the Mongolian and Chinese authorities and our customers to manage the risk of supply chain disruptions. Cross-border concentrate shipments into China have resumed with some measures in place to transport greater volumes in a safe and efficient manner, however uncertainty continues to exist with the level of the COVID-19 cases in Mongolia.

Operational Update

Maintained strong focus on safety and achieved an All Injury Frequency Rate (AIFR) of 0.13 per 200,000 people/hours worked.

Maintained excellent water-conservation practices, achieving the highest water use efficiency rates per tonne of ore production, using 0.4 cubic meters of raw water per tonne of ore processed - three times less than average similar operations worldwide. Achieved an average water-recycling rate of 87.15 per cent, compared to a target of 80 per cent.

96 per cent of Oyu Tolgoi’s workforce are Mongolian citizens.

Paid US$590 million in the form of taxes, fees and other payments to the Government of Mongolia the first nine months of 2021. Since 2010, Oyu Tolgoi has paid US$3.5 billion in taxes, fees and other payments, including VAT to Mongolian suppliers.

Partnered with 739 suppliers at the end of the third quarter of 2021, including 469 national businesses, accounting for 75 per cent of the total operations procurement spend.

Q3 2021 Performance Scorecard can be viewed here.

Production Update

Mined copper production from the open pit was 16 per cent higher than the same quarter of 2020 as the operations begin to catch up on the significant impacts of the first half, with improved performance and increased mill feed following geotechnical issues in the first half, partly offset by lower manning levels due to COVID-19.

Underground Development Update

Technical progress

Project progress continues to be significantly affected by COVID-19 constraints. Site accommodation and manning levels improved in the quarter but were between 25 per cent and 50 per cent of planned requirements in order to comply with COVID-19 restrictions. The impact on project costs of the additional restrictions related to COVID-19 at the end of September 2021 is estimated to be $140 million. Despite these restrictions, construction on the Material Handling System 1 has been progressing well and is largely complete with commissioning anticipated in January 2022.

A significant milestone was achieved in August with the ‘breakthrough’ of the conveyor decline. The service decline breakthrough is anticipated in October 2021. The underground development work including truck chute construction is progressing.

Shaft 4 sinking readiness activities have been completed. Shaft 3 readiness works have commenced with the required works underway to ensure construction can resume as soon as personnel can be remobilised and additional investment is approved by the Oyu Tolgoi Board. The delays in shaft sinking due to COVID-19 restrictions and inability to mobilise subject matter experts to site are likely to result in delays of approximately nine months to commissioning of shafts 3 and 4 based on the known impacts to date.

Contractual commitments to future works such as Material Handling System 2 and concentrator upgrades continue to be delayed pending approval by the Oyu Tolgoi Board of the increased investment required to complete the project.

Other Updates

All key stakeholders have stated that they remain committed to moving the project forward and reaching a long-term solution to the issues under discussion. In September, registration of the updated Resources and Reserves was recommended by the Mongolian Minerals Council and formal registration is expected in the coming weeks. The updated Feasibility Study (OTFS20) is still required to be accepted by the relevant governmental agencies of Mongolia before the undercut can commence.

As a result of COVID-19 impacts and outstanding non-technical undercut criteria, first sustainable production will be no earlier than January 2023 (previously October 2022), subject to the timing of commencement of the undercut. The full impact on the cost of the integrated project is subject to further analysis once we have clarity on the timeline around the completion of the undercut criteria and ongoing COVID-19 restrictions.

Other milestones that need to be met in order to ensure that the project can commence caving operations (undercut) include: approval of the additional investment required to complete the project and the funds required to finance this investment must be approved by the Oyu Tolgoi Board and extension of the current power supply arrangements until an agreed long-term stable and reliable power solution can be fully implemented.

Source: www.ot.mn

Mongolian athletes harvested two silver and three bronze medals at the Baku Grand Slam 2021 that took place in Azerbaijan on November 5-7.

IM A.Adiyasuren won the silver medal in women’s +78kg on the last day of the competition. On the same day, IM O.Tsetsentsengel grabbed bronze in men’s +100kg.

Moreover, IM B.Gankhaich has won silver in women’s -63kg, B.Khorloodoi took bronze in women’s -52kg, and Ts.Tsogtbaatar bronze in men’s -73kg.

In September, Terunofuji was the lone yokozuna in action. Now he’s all alone at the top of the rankings, published Monday by the Japan Sumo Association.

With the retirement of record 45-time champion Hakuho after September’s Autumn Grand Sumo Tournament, Terunofuji is now the sport’s lone grand champion when the 15-day Kyushu Grand Sumo Association gets underway at Fukuoka Kokusai Center starting on 14 November.

The 29-year-old Terunofuji won his debut tourney at the sport’s highest rank and will now shoulder alone the extreme expectations placed on yokozuna.

Mongolian Ichinojo is on the east after going 8-7 in his September sanyaku comeback and is joined on the west by compatriot Kiribayama.

The 25-year-old Kiribayama becomes the first Mongolian to debut in the sanyaku since Tamawashi and Terunofuji took that step in March 2015, and the 26th foreign-born wrestler to achieve the feat.

Source: Kyodo News

Mongolia recorded 789 new COVID-19 cases and 12 more deaths over the past 24 hours, bringing the respective tallies to 368,150 and 1,736, the country's health ministry said on Sunday.

The latest confirmed cases were all local infections, and 625 of them were reported in the national capital Ulan Bator, the country's hardest-hit area during the pandemic.

Currently, there are a total of 50,379 COVID-19 patients, including 2,640 children and 636 pregnant women across country, according to the ministry.

So far, 65.8 percent of Mongolia's total population of around 3.4 million have received two COVID-19 vaccine doses, while over 444,200 Mongolians aged over 18 have taken a booster dose.

HOHHOT, Nov. 7 (Xinhua) -- North China's Inner Mongolia Autonomous Region has made enormous efforts to ensure the supply of coal across the country, as coal consumption saw a surge in early winter.

A total of 40 coal mines have gradually resumed production in Erdos City, raising the number of coal mines in operation in the city to 231 and increasing the production capacity by 58.6 million tonnes.

China Railway Hohhot Group Co., Ltd. has also been mobilized in various ways to ensure the transportation of coal for power generation and heating this winter and next spring.

Since October, more than 30,000 tonnes of coal have been transported every day from Baotou's west railway station. The station has adopted a priority mechanism for coal transportation trains.

The average daily transportation capacity of the south railway station of Hohhot, the regional capital, has been boosted to 350,000 tonnes from 280,000 tonnes in August.

Meanwhile, coal mining enterprises in the region have been urged to stabilize coal prices within a reasonable range

Counties and districts in China's border city Heihe in Northeast China's Heilongjiang Province have said buying products from overseas epidemic-hit regions should be suspended after goods purchased from Mongolia by residents in Erenhot city in North China's Inner Mongolia Autonomous Region tested positive for COVID-19.

Five residents from Erenhot reported to the city's epidemic prevention and control work team recently about having received goods they had bought from Mongolia that tested positive for COVID-19. This comes as the annual shopping spree on November 11 approaches. Other places have since tightened their control over goods purchased from overseas.

In order to prevent imported infections and stop the transmission chain of the virus through goods, the local epidemic prevention and control work team of Xunke county in Heihe asked the local residents to stop purchasing any goods from overseas epidemic-hit areas.

Meanwhile, the logistics and courier companies are required to seal up the goods mailed from abroad in a designated area immediately and report to the county's epidemic prevention and control authority.

The county also encourages the public to supervise and report goods purchased from overseas epidemic-hit areas.

Aihui district in Heihe, which has two high-risk communities and 18 medium-risk communities as of Saturday, also tightened its control on goods purchased from overseas on Saturday by dissuading residents from purchasing goods from abroad.

The local epidemic prevention and control work team has asked the residents not to purchase goods from abroad if not necessary or urgent.

If they indeed need to purchase or have purchased goods from overseas, they have to report to their communities, villages or companies at once. Those who fail to report and cause transmission risks of COVID-19 or other serious consequences will be held accountable in accordance with the laws.

In Inner Mongolia, the Holingol city of Inner Mongolia has asked its residents not to purchase overseas products to reduce the infection risk for logistics personnel and themselves. Consumers who purchased products from overseas via purchasing agents are advised to ask suppliers to provide nucleic acid testing results and to not purchase products if the results are not provided.

Global Times

Member of Parliament Ts.Davaasuren held an online meeting with World Bank’s energy specialists.

At the meeting, MP Ts. Davaasuren said, “We are focusing on forwarding the projects jointly commenced and increasing the use of green energy, in particular the main focus is on the use of water resources for energy. Mongolia’s Parliament will support and give priority to all initiatives on the increase of renewable energy use. We hope that the World Bank will be a key partner in building green energy."

The World Bank has been expanding its cooperation with Mongolia and investing greatly in its energy sector. Within the framework of cooperation, the ‘Energy-2’ project is being implemented in Mongolia. During the meeting, the WB’s energy specialists expressed their readiness to cooperate in the energy sector.

Russo-Chinese trade turnover from January to October grew by 30.9% year on year, amounting to $115.66 billion, China’s General Customs Administration reported on Sunday.

Exports to the Russian Federation in 10 months increased 30.6%, to about $52.9 billion. Imports of Russian goods and services to China grew by 31.2%, to $62.76 billion.

In October alone, the volume of trade between the two countries reached $13 billion.

Trade between Russia and China in the reporting period already surpassed the figures for the whole of pre-pandemic 2019, when it was around $110.75 billion. The indicator slightly dropped in 2020 due to the Covid-19 pandemic, decreasing by 2.9% to $107.76 billion.

The growth in trade between the two countries comes amid continuing difficulties at the border. Crossing procedures introduced by Beijing at the height of the pandemic last year require that all trucks crossing into China drop their empty trailers for loading on the Chinese side and return to Russia, then go back to pick up the loaded vehicle.

Russia requires that the trailer be picked up by the same truck which took it to the border. This means that one truck has to cross the border four times, which has led to long lines at the border crossing terminals, reportedly numbering up to 1,000 trucks.

Chinese authorities this week asked Russia to conduct a detailed check of the crossing procedures and revise the way trucks with trailers cross the border, as idle time brings daily losses and affects transportation costs. China hopes Russia will switch to a cargo transportation system like the one at a checkpoint between China and Kazakhstan in Xinjiang, which allows any truck to pick up a loaded trailer.

Erdenes Tavan Tolgoi (ETT), one of Mongolia’s largest mining companies, still managed to ship an impressive 15.5 million tons of coal, earning MNT 1.68 trillion, including MNT 1.5 trillion in sales revenue amid chaos of interrupted supply chain procedures due to Covid.

The flagship company also reported a net profit of MNT 149.4 billion and contributed MNT 490.1 billion in taxes and fees to the state budget. Despite being prevented from transporting coal to China, its largest customer, ETT managed to negotiate receipt of advance payment for the coal, which will ship as soon as the borders open. As one the most profound consequences of the COVID-19 pandemic have been interruptions to the supply chain and a decline in exports and imports due to logistical challenges, this represents a coup for the company, and the people of Mongolia.

According to a recent survey, net exports from Mongolia accounted for 6.2% of the country’s GDP in the second quarter of 2018, falling to 1.9% for the same period in 2021. A 2020 study by the World Bank and the National Statistics Office of Mongolia also found that 28% of Mongolians could be called ‘poor,’ and fears have been voiced that this number could swell to around 43%. Rising prices and shortages of goods are having a substantial impact on the livelihoods of ordinary Mongolians, who find that they have less purchasing power.

In landlocked Mongolia, this longstanding issue has been exacerbated by the pandemic-related closure of several border crossings. Although this situation is somewhat expected in places like Mongolia, the socio-economic ramifications of the pandemic have been unusually severe. The recent distribution of dividends by ETT are therefore most welcome, and play a significant role in helping to rescue the Mongolia and its citizens from an increasingly difficult situation.

ETT was named the best Mongolian taxpayer of 2020 and is one of the top 100 companies in the country – a confirmation of its continuing contribution to Mongolia and her people.

Mongolian coal producer SouthGobi Resources Ltd. has been forced to suspend mining operations from this month after an outbreak of Covid-19 closed the border to its customers in China, the company said in a statement on Tuesday.

Mongolia has seen coal exports dwindle since April because of the pandemic, a contributing factor to the shortages of the fuel that have plagued Chinese industry in recent months.

Beijing has continued to push Mongolia for more supply, but to little avail. SouthGobi Resource, one of its biggest miners, reported in August that its sales fell to about 100,000 tons in the second quarter, from about 500,000 tons the year before. Mongolia’s total exports to China in the third quarter sank below 1 million tons, just a third of the volume reported in the prior year.

China imported more than 30 million tons of coal in September, so the volumes at risk from the border suspension aren’t particularly significant. But most of Mongolia’s coal exports are of the higher grade used in the steel industry, and are particularly prized by Chinese mills after the government banned similar supplies from Australia a year ago.

The Hong Kong-based, Toronto-listed SouthGobi Resource said its existing coal inventories should be sufficient to satisfy demand for at least four months once coal exports to China resume.

Source: Bloomberg