We had comments of some MPs during the Standing Committee on Economy meeting
MP Ch.Saikhanbileg, the Chairman of Demparty group: The coalition government was established in order to build an agreement on Oyu Tolgoi.
OT agreement was discussed 6 times during our group meeting. We presented our comments in two parts. First of all, we proposed to shorten the term down to 15 years and to deepen clarification of feasibility study. OT agreement draft has many unclear issues such as what will be the production capacity, what will the term, what will be the annual production. We agreed on to make these issues to be clearer and to ratify the draft immediately. In relationship to the agreement, many clauses of the Mineral Law of Mongolia should be amended.
One important thing is that this issue cannot become political debate or affected by the political interests. The agreement cannot be made under the name or label of one party or group. Or any party can’t intervene its procedure. I can directly say that this Government was established to build this agreement. This project is huge; therefore, it takes so much time.
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Feasibility studies have been publicly available for sometime, I am sure that IVN has furnished these to MPs. These are estimates, that is all that can be provided at this time in my opinion. No gaurantees can be made on annula production, NOT feasible. Many things can influence production. No guarantee will be a part of agreement. I have read, published info, gold production of 300,000 per year increasing to 600,000 per year, (if financially possible) in about 6 years.
Those numbers are incredible, but come with NO guarantees. I am more and morem coming to believe that many of the DM party wants to make sure that no profit leaves Mongolia.
Which is truely a greedy position. There are global shareholders of both IVN / RTP, they deserve a dividend for their part in supporting IVN all these years.
I have had communications from a couple of mining company IR dept, they are waiting and are becoming more concerned about investing in Mongolia. They seem to mention a cap on profits as a hinderance. I do not know where that fits in.
Anyone get any info from IVN side of negotiations?
“B”
Amaransaa, keeping asking those tough questions. People have a right to know.
I just spent a few minutes checking press items from mining companies.
Interestingly there were NO current mentions (international press) that mentioned Mongolia.
Lots of press involving Brazil, Australia, China, Indonesia, and Africa. It seems that the big international mining companies are not real interested in spending their money in Mongolia, at least at this time. Miners are interested in profits, they must think they can make more profit in other parts of the world when compared to Mongolia.
Things are still to unsettled, in my opinion, to get serious about Mongolia. Even the Tavan Ovoo coal mine is still not of serious interest yet. if miners do not see a reasonable ROI, (return on Investment), there simply is no incentive to invest. MPs seem intent on stretching that ROI out so many years that it loses interst to mining companies. It also seems that about the time IVN would begin to make a profit, the MPs want to be able to change the rules at their choosing. 15 years is not a long enough term for Oyu Tolgoi agreement.
Frustrating.
It is a good thing for investors in IVN that IVN has other mines to develope under more proitable atmosphere.
“B”
Just found, FWIW
Article published on MineWeb.com
under gold news.
New mining agreement signed between Centerra Gold and the Kyrgyz Republic.
Published M1, 2008
Much more reasonable terms than we have heard from MPs in Mongolia.
The Kumtor gold mine is the largest gold mine operated by western companies in Central Asia.
One thing not published is the duration of the agreement.
Good reading.
“B”
Some feel that China has a hand in this deal not going forward. It wouldn’t surprise to learn that they have many of these MP’s in their pocket.
http://network.nationalpost.com/np/blogs/francis/archive/2009/05/06/china-bets-on-gold-not-yankee-dollars.aspx
To Late for this year….. another year away … Talk and Talk no time for work!!!
This mine would have been in full swing if the First IA was voted on … Missed Five years ( thats 5 years ) what’s a year to a poor working family in Mongolia …. Billions and Billions worth of Copper & Gold in the ground and The government keeps it there Keeps them poor…