The plant is being built from the Indian Government's soft loan and an Indian firm Engineers India Ltd (EIL) was chosen as the project's management consultant. The mission is expected to visit Mongolia this month.

The Development Bank of Mongolia is also financing a part of the investment. Currently, MNT 61.8 billion has been allocated for construction, electricity, roads, and railways, totaling MNT 250 billion.

The construction of the oil refinery was inaugurated in Altanshiree soum of Dornogovi province, south-eastern part of Mongolia last year. The plant will have a capacity to refine 1.5 million tons of oil annually; however, the country lacks the resource to supply this giant factory. Therefore, Mongolia is currently drawing resources from the XIX and XXI area of Dornod province.

Oil is transported worldwide via sea, pipeline, road, and railway. The cheapest of these is water transport, which is impossible for a landlocked country. Accordingly, the policy-makers have decided to transport the fuel by pipeline. Officials have highlighted that the cost of transport will be comparably low and is environmentally friendly.

It is estimated that 651 kilometers of pipeline will be required from the Dornod oil field to Altanshireet soum. This area across several provinces is the main leverage for Mongolia to ease off high dependence of petroleum.

India is fully responsible for oil refineries under the bilateral cooperation agreement. Other than the factory, the pipeline, power plant, and infrastructure will be constructed by Mongolians.