Mongolia Business and Mongolian Daily Business News

Prime Minister S.Batbold said Mongolia will hire international investment banks to sell shares abroad. The Parliament has given the approval for the government to start the preparation to transfer gold, copper and coal reserves into companies that would then sell shares to global investors. This step is a demand and a necessity for Mongolia and it will potentially transform the country’s economy according to the Prime Minister. USD 25 billion of foreign investment over 5 years is needed to develop the metal and coal resources. USD 2 billion Tavan Tolgoi coal deposit is included in the list.

68.5 thousand shares of 21 JSCs were sold at MSE totaling MNT 25.3 million. Index top 20 reached 6572.91 units and were decreased by 63.77 units. 30.7 thousand shares of Khukh gan JSC was sold and it was the most actively traded share at MSE. In comparison to the previous day’s trade, share price of Erdenet carpet JSC was increased (14.89 percent) but share prices of HB oil (-13.0 percent) and Monnoos JSCs (-8.33 percent) were decreased.

You can access the full report on www.eurasiac.com

Tavan Tolgoi:  At the Crossroad

Government to retain 100% percent of Tavan Talgoi.  The Prime Minister Batbold has confirmed today the Mongolian government’s preference to retain 100% ownership of the massive Tavan Tavan coking coal project and use a “mining contractor” model.  Therefore, the international tender for equity stake in Tavan Tolgoi is now in doubt. While the equity sale option has not been entirely ruled out, the Government intends to hire a mining contractor to develop and operate Tavan Tolgoi deposit.

Tavan Tolgoi is among the world’s largest undeveloped coking coal deposits. The deposit with appr. 5.1bn tonnes in total resources is located about 200km to the north of China, the world’s largest coal consumer. Proximity to China, unique geology and economics of the deposit provide strong fundamentals to the project and raise optimism about its success. Production cost is highly competitive at US$9-US$10/ton of raw coal and US$15/ton for final product, and transportation cost in Mongolia at US$0.02/ton-km. Read the rest of this entry »

Eurasia Capital is initiating coverage of Tethys Petroleum with a BUY rating, 12-month target price C$2.00 per share. You can access the full report on www.eurasiac.com

Tethys Petroleum Limited

Attractive portfolio: Tethys Petroleum Limited (TPL), a Toronto listed company, offers unique exposure to large-scale oil and gas resources in Central Asia. TPL has five exploration and production projects in the vast hydrocarbon basins of Kazakhstan, Tajikistan and Uzbekistan where several global major oil and gas companies are currently operating. TPL believes that the contract areas have significant exploration and production potential and it may create more value by applying modern methods and technologies in its operations. In our view, TPL will expand its portfolio to more exploration and production projects in the near future, in particular in Uzbekistan. Read the rest of this entry »

During the press conference of the Mongolian Economic Forum, media representatives made few questions about forum and other related issues. Officials answered as follows:

Q: Oyu Tolgoi Investment Agreement was signed. But the feasibility study is not completed and reserve is not clearly stated?

Minister for MRE, D.Zorigt: Oyu Tolgoi reserve is approved. It was announced during the investment agreement. It is misleading information. Within 150 days or until April 6 2010, after the signature of the Investment Agreement, Feasibility Study will be discussed. If one reads the agreement, it was clearly stated.

Q: What will be your explanation on your attendance at the ceremony of marking % years of successful trading of Ivanhoe Mines at NYSE? People say it was promoting Ivanhoe Mines.

Minister for Finance S.Bayartsogt: Thanks to Oyu Tolgoi, Mongolia unlocks its development gateway. I believe that a Mongolian ringing bell at NYSE is promotion for Mongolia than Ivanhoe Mines. Over 120 million people, who are active in capital market, business and economy, are watching morning trade opening ceremony. Therefore, it was purely promotion for Mongolia. I don’t want to argue much more because many Mongolians have poor knowledge of stock market. Read the rest of this entry »

photo courtesy of meforum.mn

Prime Minister S.Batbold held a meeting with Tavantolgoi project task group. Guidelines and procedures for using the deposit was approved by the Parliament resolution No.40 in 2008 and accordingly a  task group comprising of Ministry of Mineral resources and energy, Ministry of Finance, Ministry of Environment and tourism, Ministry of Justice and Domestic Affairs and State Property Committee has been established. PM highlighted the importance of creating legal regulations by the Parliament and the Government for constructing chemical and steel metallurgic plants based on strategic deposits, which would contribute greatly to the Mongolian economy, creating necessary infrastructure and producing VAT included products. According to the Minister of MRE, south Gobi infrastructure plan for constructing railroads, power plants and water resources necessary for Tavantolgoi utilization is ready for submission to the Government. The resource estimate of the deposit has been changed as results of hiring Canadian Norwest company as a project technical Consultant and Sanh resources may be increased by USD 5 billion. Upon resource increase, the amount of tax income and advance payment to the state budget shall go up as well. Read the rest of this entry »

Oyutolgoi Investment Agreement, which has been signed last October, shall come into effect on April 6 of this year and Oyutolgoi LLC shall commence its operations officially. Oyutolgoi is preparing all plans and projects until the effective date.

However it didn’t provide the feasibility study, which has been rejected because officials explained there were some issues to be clarified. As reported by Oyutolgoi, there are 2-3 issues including water supply and resource. In order to clarify whether Oyutolgoi has spent over USD one billion for the project, the audit and tax reviews are being carried out. It will not start recruiting employees until the effective date.

Title: PDAC 2010 NETWORKING RECEPTION
Location: The Continental Hotel, Ulaanbaatar
Description: The Canadian Embassy in Ulaanbaatar invites the mining community of Mongolia to attend the
“PDAC 2010” Networking Reception. This event is a platform to exchange information with your
peers, share knowledge and experiences, build relationships and create new business contacts.
Join a wide variety of professionals representing both Mongolian and international companies
spanning the entire spectrum of the minerals and mining sector.

Canada is the proud host of the biggest mining investment show in the world. Let us tell you
more about it.
PDAC 2010 will be held in March 7-10, 2010 in Toronto, Canada. PDAC is the one place where
everyone from the industry meets under one roof. It is the place to look for potential clients,
suppliers, customers, partners, investors and new technologies. Exhibitors at PDAC will
showcase their businesses and speakers will come from around the world.
PDAC\’s annual convention is the premier event in the global exploration and mining sector. So it
is worth its price in gold to attend it for the interesting meetings, training courses and other events.
Start Time: 18:00
Date: 2010-02-11
End Time: 20:00

Center for International Private Enterprise (CIPE) sends a complimentary letter to Prime Minister S.Batbold in relations with the Mongolian Government announcement of “Year 2010 as the Year of Business Environment Reform”.

The letter states that “… this announcement and initiative will surely support the enterprises in Mongolia and its positive results and outcome will promote and encourage similar initiatives around the world. It is the one example that Democracy in Mongolia eminently develops …” Read the rest of this entry »

Yesterday the Cabinet Meeting was held and discussed several issues such as draft resolution on State Service Structure, SGK draft resolution on oil products, the Government draft evaluation on Casino Law.

Cabinet Meeting didn’t support the Casino Law, initiated by MP D.Zagdjav and others.