BoM to conclude contract with banks to finance gold sector www.montsame.mn
The Bank of Mongolia (BoM) is preparing to provide soft financing to gold mining companies. With implementation of the program, 23 tons of gold is estimated to be mined or to increase official foreign exchange reserves by USD 1.2 billion at the current value.
Gold financing is being classified into two parts: long-term and short-term. Funding for circulating capital with terms of up to six months will equal up to 30 percent of the total amount of gold, which was reflected in this year's approved mining plan of the company. While long-term financing has terms of up to 24 months and will equal up to 30 percent of total amount of the approved reserve.
When the Ministry of Mining and Heavy Industry makes a list of potential entities that meet criteria, the BoM will conclude a contract with banks within this week and start providing the financing, the BoM informs.
Official foreign exchange reserves has gone down by 11.6 percent since the arrival of 2020, reaching USD 3.8 billion at the end of April. Out of gold mining companies listed on foreign stock exchanges, “Steppe Gold” company has launched exploitation at “Altan tsagaan ovoo” deposit. The company plans to exploit 60 thousand ounce of gold this year. And it has sold 5233 ounce of gold and 1372 ounce of silver to the Central Bank.
Furthermore, “Xanadu Mines” Company, an owner of “Kharmagtai” project, has begun its exploration of “Ulaan tolgoi” project. The sides agreed to a financing of up to USD 7.2 million from a Japanese Government Agency in the project. While, the company has drawn funding of AUD 1.12 million from foreign countries for the exploration of “Kharmagtai” project.
Published Date:2020-06-11