Mongolia’s inflation rate rises above central bank’s target to 8.1pc www.daily-sun.com

ULAN BATOR: Mongolia's inflation rate increased to 8.1 percent in June from 7.9 percent in the previous month, the country's central bank's spokesperson Ariun Dagva said Monday.

Joint working group of cooperation between Iran, Mongolia to be formed www.en.irna.ir

Mahmoud Hojjati, the Agriculture Jihad Minister of the Islamic Republic of Iran, arrived in Mongolia on Monday, conferred with Mongolian Minister of Food, Agriculture and Light Industry Choltmen Olan in the capital, Ulan Bator.

Zumtobel Group receives million-euro contract for infrastructure project from Mongolian government www.zumtobelgroup.com

Dornbirn, Austria / Ulaanbaatar, Mongolia – The international lighting group Zumtobel Group has secured a contract in the low double-digit million range with the Mongolian government for a comprehensive street lighting project in the north of Mongolia’s capital. Roughly 11,000 LED lights of the Thorn brand will be installed in previously unlit streets and squares, thus contributing to increasing the standard of living in public space. The aim is to use light to reduce the crime rate and enhance safety on a sustained basis. In addition, the provision of essential infrastructure such as lighting is a key factor for attracting companies and therefore serves the overall economic upswing in the region.

Two arrested in Mongolia for illegal transportation of 500 kg of deer antlers www.xinhuanet.com

ULAN BATOR, July 22 (Xinhua) -- Mongolian police have arrested two men for the illegal transportation of 500 kilos of deer antlers from Khuvsgul province to the capital city of Ulan Bator, the country's National Police Agency (PLA) said Monday.

Rio Tinto's Mongolia copper problems highlight frontier country risks: Russell www.business.financialpost.com

LAUNCESTON (Reuters) — Looking for a long-term bullish signal for copper? Then look no further than Rio Tinto’s struggles with the Oyu Tolgoi mine and expansion project in Mongolia.

The latest news about the giant copper-gold project is that the production from the underground expansion will be delayed by more than a year to between May 2022 and June 2023, and that costs have ballooned by another $1.9 billion.

The capital cost of the project is now estimated at $6.5 billion to $7.2 billion, up from an original estimate of $5.3 billion.

Rio Tinto, through its Turquoise Hill Resources subsidiary, owns 66% of the Oyu Tolgoi mine, which could become the world’s third-largest copper mine by production in 2025 under the current development plan.

What’s becoming more of an issue for the mine is that the Mongolian government owns the other 34%, and it appears that there is mounting disquiet in Ulaanbaatar that the landlocked country between Russia and China is getting a dud deal.

Mongolia’s parliament is set to approve measures that would terminate the 2015 agreement on the Oyu Tolgoi underground expansion, seeking to bring forward the time when it will receive dividend payments from the project, demand more transparency on copper prices and push for Rio Tinto to build a power plant.

Currently, Mongolia will only start to receive dividends around 2041, when its share of the debt for the project is repaid.

“For now, the Oyu Tolgoi agreement is not benefiting Mongolian citizens,” Battumur Baagaa, a member of the parliamentary working group scrutinizing the project, told Reuters. “It is good to attract foreign investment but that doesn’t mean foreign investment should only benefit the foreign side.”

The sentiment expressed in the above quote goes to the heart of Rio Tinto’s Mongolia problem, and indeed to any mining company considering a major investment in a developing, or frontier market.

BALANCING RISKS

The Oyu Tolgoi project is a country-changer for Mongolia, with its capital budget making it the biggest ever undertaken in the country, but it’s also more than half of the annual gross domestic product (GDP) of $13 billion.

By comparison, the $200 billion of spending on eight liquefied natural gas (LNG) projects in Australia over the past decade, the biggest investment in a single industry in the country’s history, represented about 17% of annual GDP.

A country such as Mongolia cannot afford the upfront cost for its stake in a project the size of Oyu Tolgoi, so it pays for its share by deferring dividends.

While this sounds like a good solution in theory, it also means that the government, and the populace, see the mine being built and start operations, but they don’t necessarily see the benefits flowing to them.

Rio Tinto makes the point on its website that from 2010 to the third quarter of 2018 it has spent “$8.3 billion in-country in the form of salaries, payments to Mongolian suppliers, taxes, and other payments to the government.”

The question is whether this is enough, and the answer the Mongolian authorities appear to be giving is no.

The obvious risk for Rio Tinto is that it spends billions of dollars on an investment that takes a longer period to deliver returns, or even in the worst case the asset is seized by the state.

This situation is increasingly being confronted by resource companies around the globe.

Mozambique and Tanzania are both keen to see international oil and gas companies spend billions of dollars developing an LNG industry in the east African neighbors.

But will the authorities remain satisfied with the terms that were initially struck when it becomes clear that the benefits to the government coffers will take some time to flow?

Increasingly, valuable deposits of commodities are in jurisdictions with higher country risk, but it doesn’t appear that project developers factor in the likelihood of having to renegotiate terms once vast amounts have already been spent.

It’s always going to be a fine balance between a company assessing how much of the value of the project it can afford to surrender to the host country, and the government of that country working out how hard they can squeeze before the company walks away and your investment reputation is severely damaged.

For the market, the risk is that much of the new supply of several key resources is likely to come from countries such as Mongolia, and the question is how likely is it that this resource is actually developed and delivers to plan. (Editing by Christian Schmollinger)

International military horse racing event to take place in Mongolia www.montsame.mn

Ulaanbaatar /MONTSAME/. The ‘Aravt’ international military horse racing event is to take place for the first time in Mongolia between August 3 and 8.

Projects worth EUR 12 million to be implemented www.montsame.mn

Ulaanbaatar /MONSTAME/ Within the Financial Cooperation Agreement between Mongolia and the Republic of Austria, the projects titled ‘Infrastructure Development - Songinokhairkhan’ and ‘Infrastructure Development – Bayanzurkh, Darkhan, and Selenge’ will be implemented from 2019 to 2021with a soft loan worth EUR 12 million from Austria.

Chandrayaan-2: India set to re-attempt Moon mission launch www.bbc.com

India is set to re-attempt the launch of its second lunar mission a week after it halted the scheduled blast-off due to a technical snag.

Chandrayaan-2 will be launched at 14:43 local time (09:13 GMT) on Monday, space agency Isro said.

It added the spacecraft was ready "to take a billion dreams to the Moon - now stronger that ever before".

The space agency hopes the $150m (£120m) mission will be the first to land on the Moon's south pole.

The countdown on 15 July was stopped 56 minutes before launch after a "technical snag was observed in [the] launch vehicle system", according to Isro. Indian media have reported that a leak from a helium gas bottle in the cryogenic engine of the rocket was to blame.

Isro thanked people for supporting the mission despite the delay.

What is this mission all about?
India's first lunar mission in 2008 - Chandrayaan-1 - did not land on the lunar surface, but it carried out the first and most detailed search for water on the Moon using radars.

Chandrayaan-2 (Moon vehicle 2) will attempt a soft landing near the little-explored south pole of the Moon.

The mission will focus on the lunar surface, searching for water and minerals and measuring moonquakes, among other things.

India is using its most powerful rocket, the Geosynchronous Satellite Launch Vehicle Mark III (GSLV Mk-III), in this mission. It weighs 640 tonnes (almost 1.5 times the weight of a fully-loaded 747 jumbo jet) and at 44 metres (144ft) is as high as a 14-storey building.

The spacecraft weighs 2.379kg (5.244lb) and has three distinct parts: an orbiter, a lander and a rover.

The orbiter, which has a mission life of a year, will take images of the lunar surface, and "sniff" the tenuous atmosphere.

The women scientists who took India into space
Israeli spacecraft crashes on Moon
Is India ready to send someone to space?
The lander (named Vikram, after the founder of Isro) weighs about half as much, and carries within its belly a 27kg Moon rover with instruments to analyse the lunar soil. In its 14-day life, the rover (called Pragyan - wisdom in Sanskrit) can travel up to a half a kilometre from the lander and will send data and images back to Earth for analysis.

"India can hope to get the first selfies from the lunar surface once the rover gets on its job," Dr K Sivan, the Isro chief, said before the first launch attempt.

The launch is only the beginning of a 384,000km (239,000-mile) journey - Isro is hoping the lander will touch down on the Moon on 6 or 7 September.

The space agency has chosen a circuitous route to take advantage of the Earth's gravity, which will help slingshot the satellite towards the Moon. India does not have a rocket powerful enough to hurl Chandrayaan-2 on a direct path.

"There will be 15 terrifying minutes for scientists once the lander is released and is hurled towards the south pole of the Moon," Dr Sivan said.

He explained that those who had been controlling the spacecraft until then would have no role to play in those crucial moments. The actual landing, he added, was an autonomous operation dependent on all systems performing as they should. Otherwise, the lander could crash into the lunar surface.

Earlier this year, Israel's first Moon mission crash-landed while attempting to touch down.

Who is on the team?
Nearly 1,000 engineers and scientists have worked on this mission. But for the first time, Isro has chosen women to lead an interplanetary expedition.

Two women are steering India's journey to the Moon. While programme director Muthaya Vanitha has nurtured Chandrayaan-2 over the years, it will be navigated by Ritu Karidhal.

National currency in circulation reaches MNT 937.1 billion www.montsame.mn

Ulaanbaatar /MONTSAME/ The money supply reached MNT 20.2 trillion at the end of June 2019, showing a decrease of 0.3 percent from the previous month, while it shows an increase of MNT 16.7 percent from the same period of previous year.

Mongolia receives 247.3 thousand foreign tourists in the first half of 2019 www.montsame.mn

Ulaanbaatar /MONTSAME/ In the first half of 2019, 2.8 million passengers (double counting) have crossed the border of Mongolia, increased by 55.5 thousand or 2.0 percent compared to the same period of previous year.