MPs handed a demand letter to the Speaker on Oyu Tolgoi Investment Agreement

MP Z.Enkhbold, Chairman of Standing Committee on Security and Foreign Policy, and MP N.Batbayar handed an official demand letter to Speaker D.Demberel on strengthening and implementing the resolution of the State Great Khural.

MPs D.Gankhuyag, Z.Altai, N.Batbayar, G.Bayarsaikhan, E.Munkh-Ochir, D.Odkhuu, Sh.Saikhansambuu, D.Enkhbat, B.Bat-Erdene, Z.Enkhbold signed on the demand letter.

Several issues were pointed in the demand letter issued by MPs of parliamentary parties, independent MPs. All of them are considered as severe breaches of the Mongolian laws. They think that some of the clauses and provisions of the Investment Agreement and shareholders’ agreement also breach the Mineral Law of Mongolia and other related laws. 44% of the total gold and copper reserve, which was presented for the approval for the State Great Khural, of the deposit, is not registered in the state reserve, but feasibility study is accepted. Also, certain part of the royalty payment will be paid in advance, stated in the 40th and 57th resolution of the State Great Khural, but it is converted into loan agreement on 250 million USD with 5% interest rate. The prepayment of this loan is introduced to the public as the prepayment of the investment agreement.

Plus, the provision “… the Government (S.Bayar) is responsible for reaching deal with the investor’s side on increasing the Mongolian state share minimum 50% of the project after recovering the initial investment by establishing legal environment…” of the resolution 57 of the State Great Khural is not completed.

The demand letter states also that the Government shall pay attention on the implementation of the SGK’s resolution before April 6 2010.

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