IZ-KARTEX continues to supply shovels to Mongolia www.globalminingreview.com

A new EKG-12K manufactured by IZ-KARTEX has arrived in Mongolia for Erdenet Mining Corporation operations. This is the second IZ-KARTEX shovel that was manufactured for Mongolian enterprise this year.

Authorities order Inner Mongolia to end crypto mining support: report www.technode.com

Authorities in Inner Mongolia have issued a notice banning support for the cryptocurrency mining industry within the autonomous region, Chinese blockchain media ChainNews reported.

President Kh.Battulga visits construction site of Tavantolgoi-Zuunbayan railroad www.montsame.mn

Ulaanbaatar /MONTSAME/. Over the weekend, President of Mongolia Kh.Battulga worked in Dornogobi aimag to keep abreast to development works of the Tavantolgoi-Zuunbayan railroad. The 414.6 km long railroad, which is reflected in the state policy on railway sector, is under construction in Mandakh and Zuunbayan soums of Dornogobi aimag at the same time.

BoM may leave policy rate unchanged amid high inflation www.zgm.mn

As the inflation rate exceeds the target level of 8 percent in August, the Bank of Mongolia (BoM)’s Monetary Policy Committee is scheduled to announce its third Monetary Policy Decision Today. As of August 2019, annual inflation rate has reached 8.9 percent nationwide.

UB coal ban: households to face challenges this winter www.news.mn

Starting in May, the government of Mongolia introduced a coal burning ban in the capital, Ulaanbaatar, as part of efforts to clean up the city’s air. Those households and businesses that continue to burn coal risk being fined. However, as winter approaches, implementing the ban is going a challenge; at the same time, reducing the chronic air pollution in Ulaanbaatar, is of fundamental importance in order to stop the annual death toll – particularly among infants and the elderly – and protect the health of the population as a whole.

Ariunaa Batchuluun: Gobi becomes the first Mongolian cashmere brand to launch online shop in the USA www.news.mn

www.us.gobicashmere.com today at 09:00 AM (New York time). Accordingly, we interviewed Ariunaa Batchuluun, director of Foreign Trade (the USA and Asia) of the GOBI cashmere corporation.

-Today is a very important day for Gobi cashmere. I would like to start the interview with huge congratulations on your launch into a new market.

-Thank you very much. Yes, indeed it is an important day for Gobi cashmere. We are launching our Gobi cashmere USA online store www.us.gobicashmere.com today at 09:00 AM New York time. We are excited to bring our products even closer to our current and future customers in the United States.

-I’m curious about the special launch surprises. Are you going to have anything special for the launching?

-Of course, there will be some surprises. Very special ones indeed. We are staring “Feel the real cashmere” campaign for the Gobi cashmere USA launch. As Gobi cashmere is comparingly new brand to the majority of the cashmere lovers in the USA, we would like them to buy the first items for a surprisingly reasonable price and feel the touch of real cashmere.

All Gobi cashmere products are on sale up to -70% for limited-time. Purchasing 100% cashmere garments at this price upon the chilly, cold season and right before the holiday season is a rare opportunity for sure. As we want people to buy and feel our product, for the first 500 purchases we will give 100% pure cashmere socks for free.

-Gobi cashmere products have already appeared in the USA market as I understand. What are the special features of this launch?

-Gobi has been exporting cashmere products to the USA for quite some time. But it was franchise sales. Today we are finally opening our official subsidiary company in Los Angeles. The company office will be based in LA and will run an online shop in the USA. For the long run, we are aiming to be able to operate throughout the South and North American continents. E-Commerce is a huge platform which is growing at an unprecedented rate all over the world. Thus, we are going to operate an online shop as well.

-Does that mean a customer anywhere in the USA can order Gobi products and get it delivered to their home?

-Yes. Gobi products will be delivered to anywhere in the USA within 24-48 hours. Of course, as we all know, the USA has big territories, for states such as Alaska and Hawaii it will take a bit longer. Time is indeed valuable in the modern world and online shopping is growing rapidly worldwide. Especially in the case of America, the country with 51 states, the online shopping and delivery system are extremely developed. We will offer the best quality delivery service and advanced technological options as well.

-Online shopping is a huge market. How much growth do you expect in the sales volume?

-We aim to sell one million products through online shopping in the USA within one year. It might sound big and ambitious comparing to our previous sales volume, but we see the potential to reach our goal with our prior focus on the market and being an active player in the industry. Our colleagues and all Gobi family are working hard to reach this goal.

-There could be a question if cashmere is highly demanded in the USA as the weather is relatively warm in some areas of the USA.

-When it comes to cashmere products, we used to imagine warm cashmere sweaters, hats, and scarves that are usually worn during the winter. But that is quite traditional and more likely outdated imagination, if I may say. New concept that Gobi cashmere offers to the customers is to feel cozy, comfortable in your high-quality soft cashmere garment, regardless of the weather condition or which season it is. We produce all types of cashmere clothing items that are suitable to wear in any season and during any types of occasions.

-Which products are predicted to be the most popular ones on the USA market? How do you see your target groups?

-Looking at the American and European consumerism, they are usually interested in knit products such as cashmere sweaters, accessories and cashmere shawls, etc. GOBI has become the world’s number one coat company in terms of 100% cashmere production volume. Gobi factory is capable to produce 160’000 pieces of coats per year. Our cashmere coats are 2-3 times lighter than the traditional wool coats and they are very warm and cozy. Cashmere coats, cashmere sweaters, main knit and woven accessories are the main products we are highlighting at this stage. Gobi Cashmere is offering high quality guaranteed, available in unisex option, free size cashmere products to the USA market for all genders, ages, and body types. We are aiming to the customers who wants to use high quality, luxurious products with affordable price. 100% organic, hand combed, locally sourced and locally made cashmere products will be offered with very reasonable price in various types of designs and options.

-Big markets like America requires special attention to fashion design?

-Our main design team consists of the most talented Mongolian designers who have years of experience in the cashmere industry that knows the textile. In addition to that, in order keep up with the latest world fashion trends and standard, and enrich our brand design solutions, we collaborate with international highly skilled fashion designers from Italy, Germany, and Spain. We regularly participate in the fashion shows and the annual fashion events in Italy, to get the inspiration and to keep ourselves ahead of modern trends.

-Is Gobi cashmere becoming the first Mongolian company that solely focuses on online shopping?

-In terms of the production volume and target market range, yes.

Today we are launching www.us.gobicashmere.com. We already operate other online shops in different markets. www.gobicashmere.com is operating successfully in the European market. We have www.gobi.ru in Russia and www.taobao.gobicashmere.com in China.

If we see the products volume, design variety, target market size, Gobi is becoming the first Mongolian cashmere brand that is going into the eCommerce platform. Hence, we see this as a matter of honor to pioneer to introduce a Mongolian cashmere brand in the world eCommerce platform at this extended level. We hope this will draw a fine path for other Mongolian brands to the world market as well.

-The USA is in the process of approving the Third Neighbor Trade Act for Mongolia. There is no doubt that this will help facilitate the cashmere sector. There is a criticism that the cashmere sector is a small matter to discuss?

-Agricultural products, production, and export are of great importance to our country. In a related context, our sector’s officials presented this law to the USA and now they are working closely with the Congressmen, who initiated this law, as well. We put great importance to this and support the idea very much as we are the oldest cashmere manufacturer in Mongolia and the main player owns the 85% of domestic market share. The agricultural sector is very important to Mongolia as we have more than 800,000 households as a country level, and 220,000 of them are herder families. Their daily income is solely dependent on livestock and agricultural products. Numerous amounts of people starting from the herders to the factory workers and employees and their families benefit from the cashmere industry value chain.

-How about some issues related to the cashmere and how you collect it?

-When we learn the matter from the scientific perspective and talking with herders, goats do not damage the pastureland alone as it is shown in the media. From a different perspective, it is important to understand that taking the cashmere out of the goats is a help to the goats. During the long harsh winter of Mongolia, goats grow long fiber as the undercoat. When the harsh winter ends, it gets loose between the hair and to put the goats at ease, herders hand-comb it off every spring. It helps them to endure the hot summer and prevents to grow external parasites under their hair as well. Therefore, we can say taking out the cashmere from the goats by hand is the traditional method of prevention. Mongolian traditional nomadic way of coexisting with livestock gives the special feature of differentiation to cashmere sourced from Mongolian land, in terms of care for the goats and cruelty-free way of treatment.

-Shall we end our interview by giving information on how the agricultural sector benefits the economy and what are those benefits?

-Another reason why we are specifying this sector is that the main developing sectors such as mining and construction are male-dominated. But on the other hand, this causes unemployment for women and single mothers and increase the demand for women to work. There are more than 3-4 people behind single mothers including children and parents. Our industry could be seen as a female-dominated work environment. Our factory has over 2,800 employees, and more than 75% of them are women. Hence, American congresswomen are putting great importance in this matter as well. One of the few sectors of Mongolia that that is capable of improving the women’s livelihood and increasing the women’s employment is our sector and this is why we are supported by the Trade Act as well. Also, I’d like to point out that exporting value-added products that are made in Mongolia than exporting large quantities of raw materials that could not make it to products, is a huge contribution to the economy.

-Thank you for sharing the news with our readers. Wish you and your team good luck for the big launch and the further endeavors!

-Thank you very much.

Elixir completes seismic, remains on track for first spud www.finfeed.com

Mongolian focused gas explorer, Elixir Energy Limited (ASX:EXR), this morning provided an update on current field operations in its 100% owned Nomgon IX coal bed methane (CBM) production sharing contract (PSC) in the south of Mongolia proximate to the Chinese border.

Elixir reports that the 2019 Nomgon IX Seismic Survey has now been completed with results due in six weeks. Preparation for the CSG drilling campaign on schedule and the spud for the first well is expected in late September/early October.

The seismic survey acquired 131 kilometres of 2D data over coal seam gas (CSG) leads at Ugtaal Uul, Nomgon North and Bag in the PSC (see map below).

The company note that work was conducted safely, environmentally responsibly, efficiently and professionally by Mongolian owned Microseismic LLC with processing and interpretation to follow over the next six weeks.

Preparation for the CSG drilling campaign remains on schedule and Australian sourced permeability testing equipment has now arrived in Mongolia.

Desorption equipment sourced from the USA has been shipped and will arrive in Mongolia this week. In addition, Elixir is utilising CSG-experienced rig supervisors and other technical support from Australia and the USA and this team is ready to mobilise within the next few weeks.

For the drilling program, Elixir is using the highly respected Mongolian owned and operated drilling contractor Erdenedrilling LLC, who is currently awaiting the arrival of this US and Australian equipment.

Estimated spud for the first well (Ugtaal-1) remains the end of September/early October, while a second well location will be selected by around the end of this month.

Elixir’s Managing Director, Mr Neil Young, said “Our fully funded 2019 exploration program is going to plan. We have been very pleased with the professionalism and output of our Mongolian seismic contractors. We are now in the final pre-spud stages of our imminent drilling campaign, which has been designed to be the most technically advanced ever conducted for CSG in Mongolia.”

Good Oil Conference
Today’s news follows the company’s presentation at the Good Oil Conference in Perth last week. After attending the conference, a Patersons Securities resource analyst highlighted Elixir as “one to keep an eye on” in a brief note to clients. The analyst suggested that Elixir may be a good way to play the China gas thematic, something that has been missing since Sino Gas’s departure from the ASX.

The note explained that “The EXR team is technically astute, and includes Stephen Keleman (former manager of STO’s CSG business, Neil Young (ex-STO management, and has worked in Mongolia for the last eight years), and the ever humble Richard Cottee (Non-exec Chairman)”.

As I mentioned last week, in the article Oil and gas juniors looking the goods, Elixir is drawing comparisons to a number of other up and coming oil and gas explorers, including (what has almost certainly been Australia’s most successful oil and gas junior of the past two years), Galilee Energy (ASX:GLL), plus London’s Perto Matad (LSE:MATD), and Strike Energy (ASX:STX) and its JV partner Warrego Energy (ASX:WGO).

China to upgrade Mongolian border-crossings www.news.mn

Mongolia will renovate Mongolia’s Zamyn-Uud and Gashuunsukhait border-crossings with the non-refundable Chinese aid. The Zamyn-Uud port, which is one of the largest in Mongolia, accounts for 40 percent of passengers and 76 percent of passenger vehicles passing through customs. However, border-crossing construction and infrastructure cannot meet the growing demand, which leads to difficulties in customs clearance procedures.

Rio Tinto prepares for Mongolian parliament review www.afr.com

Rio Tinto faces renewed political scrutiny in Mongolia this week when lawmakers in Ulan Bator are scheduled to debate the legal agreements that underpin the Oyu Tolgoi copper mine.

Rio has been producing copper and gold at Oyu Tolgoi since 2013 and is currently spending between $US6 billion ($8.7 billioN) and $US8 billion on an underground expansion of the mine, which ranks as the company's most-important growth asset.

The Mongolian government launched a working group in March 2018 to review the implementation of the 2009 Oyu Tolgoi Investment Agreement, the seminal legal contract under which Rio works at the mine.

It examined taxation, energy, and shareholder funding arrangements under the 2009 agreement, which gives the Mongolian government a 34 per cent stake in the mine.

The report was presented to a Mongolian parliament committee in May, at which time a new group of nine Mongolian parliamentarians was formed to draft recommendations to cabinet over the mine's future.

Those recommendations are scheduled to be debated in Mongolian parliament on Wednesday, according to a schedule of parliamentary proceedings published by the Mongolian parliament on Friday.

That schedule fits with guidance provided last week by Turquoise Hill Resources, the Rio subsidiary that owns 66 per cent of the Mongolian company that owns the Oyu Tolgoi mine.

At an investor briefing last week, Turquoise Hill said the working group's "draft resolution'' was ''expected to be discussed during an extraordinary session to be held until September 30, 2019''.

''In the interim, Turquoise Hill remains engaged with the government of Mongolia on multiple fronts.''

Rio owns 50.79 per cent of Turquoise Hill and both companies have repeatedly stressed the importance of honouring and retaining both the 2009 Investment Agreement, and a 2015 agreement struck by Rio's then-copper boss and now-current chief executive Jean-Sebastien Jacques.

The 2015 agreement that Mr Jacques struck with then-Mongolian prime minister Chimediin Saikhanbileg outlined the financial terms upon which an underground expansion of Oyu Tolgoi would proceed.

That expansion was supposed to cost $US5.3 billion, but in July Rio said project management failures and geological challenges would had pushed costs higher to between $US6.5 billion and $US7.2 billion, and that it would be delivered as much as 30 months later than previously expected.

Those cost estimates do not include the cost of building a power station for the mine, which most pundits expect to cost an additional $US1 billion.

Mongolia's equity stake in the project has made it particularly sensitive to cost blowouts, particularly as its economy has laboured under some of the world's highest interest rates, requiring a bailout from the International Monetary Fund in 2017.

Reports have suggested the Mongolian lawmakers may also seek changes to Mr Jacques' 2015 agreement.

While the political turbulence continues in Mongolia, Rio and Turquoise Hill are conducting a major rethink of the mine plan for the underground expansion, and are not expected to settle on a new mine plan until late 2020.

Peter Ker covers resource companies, based in Melbourne. Connect with Peter on Twitter. Email Peter at pker@afr.com

Democracy under threat in Mongolia? www.news.mn

Democracy gives Mongolians the right to have and express opinions. However, many consider that the Law on Offence, approved by Mongolian Parliament in 2018 is threatening, that very right. According to police statistics, nearly 370 complaints have been claimed by individuals since 2018: 30 percent of them made by politicians who consider that their reputations has been defamed. Furthermore, 182 journalists have been convicted on those charges; 25 of them have been fined MNT 2 million each.