Mongolia Business and Mongolian Daily Business News

As proposed by Prime Minister S.Batbold to Speaker of the State Great Khural, the following arrangement will be implemented by the Government of Mongolia in privatizing the state owned projects and properties.

1.    To establish “Mongol Erdenes” LLC and list it at the domestic and foreign capital markets, based on the Mongolian ownership of Oyu Tolgoi and other strategic deposits and Erdenet and MongolRosTsvemet, in accordance with the common agreement with Russian Federation.

2.    To establish business entity and list it at the domestic and foreign capital markets, based on the Mongolian ownership of uranium deposits.

3.    To establish “Mongol Infrastructure” LLC and list it at the domestic and foreign capital markets, based on the joint actives and futures of the planned railroads, strategic roads. Read the rest of this entry »

Under the Mongolian Constitution adopted on 26 November 1924, all the land, the wealth contained therein, mineral resources, forests, and water were declared to be the property of the people. This principle was confirmed in Constitution in 1940 and 1960.

The article 10 of Constitution 1960 of The Mongolian People’s Republic provided: ‘The land and its minerals, forest, water and its wealth, state factories, plants, mines, electric power stations, railway, motor vehicle, water, and air transport, highways, means of communication, banks, state agricultural enterprises, and the basic fund in cities and other population centers, raw materials, materials and products of state enterprises, state trade and procurement, enterprises, scientific and cultural institutions, and also the property of all state organizations and institutions shall be state ownership, that is, the wealth of the whole people’. Read the rest of this entry »

9200 USD per ton is absurd, let’s give the power to the Government.

Q: Many people worried about urgency of signing IA on Oyu Tolgoi. Being as an expert in this field, how do you see this development around OT IA?

MP Kh.Narankhuu: Before talking about details, I pay much attention on reaching comment agreement or consent on the principle Based on this principle, the correct decision will be made. I see many different and wrong understanding according to the principle.

Q: What exactly? Read the rest of this entry »

P.Ochirbat: Once we stated 34% in the law, we have to follow the law. Actually, it is not good to promise or acquire 34% when we don’t have money at all, especially in this time of crisis and recession. 34% is about a billion US$. We should spend this money on infrastructure and other industries. But we are all about to give away everything we have on mining industry like a placing bet. This means we are making our economy vulnerable and wearing off the immune of our economy. Our economy can’t be in crisis or slump when gold or copper price slumps.

Read the rest of this entry »

Q: Happy 30th anniversary of the factory. What were the achievements in 30 years of your history.

Ch.Ganzorig: Thank you. This year Erdenet factory reached its plan target and its implementation is 101.0%-102.0%. We can extract more copper and molybdenum than our plan. Metal extraction of copper percentage was 86.23% and molybdenum was 40.66% and it was the top result in the history of the factory.

Q: How was the profit of the factory? Are there any difficulties for Erdenet in time of world economy recession?

Ch.Ganzorig: First three quarters of year 2008, copper price was high enough. But it fell drastically in the last quarter. Average price of one ton copper price at LME was 6900 US$ and it was lower by 218 US$ than the previous year. Read the rest of this entry »

Erdenet, the Mongolia-based copper mining joint venture that is 49% Russian-owned, will ship its copper and molybdenum concentrates and alloys to Russia from next year, Alexei Aleshin, first deputy director of the state Russian Technologies (Rostekhnologii) corporation, said during a visit to Ulan Bator.

Rostekhnologii manages Russia’s stake in the joint venture. Mongolia’s government owns the other 51%. Aleshin said Rostekhnologii planned to make a significant contribution to the mining enterprise’s development, buying state-of-the-art equipment for it and putting new products on line.
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MP KIh.Narankhuu has his opinion regarding the mining industry and its recent development.

Q: Information of the working group was heard to the Standing Committee on Economy. Being as the Minister in charge of the Mineral Resource, what is your position in this environment?
MP Kh.Narankhuu: The working group presented its conclusion in the time of establishment of Coalition Government and new environment of crisis.
The Mineral Law of year 2006 was good law that is suitable for the situation. We issued the law that is much free that can attract foreign investment when the copper price was 1560-1750 US$. But many angel investors that are not serious in developing project, but are serious in raising making money on the mining projects, poured into Mongolia. It was one of the main reasons of stirring such a mess. It created negative feeling in the society. Also those many investors disappeared when the commodity price feel. Read the rest of this entry »

In conjunction with the 30th anniversary of Erdenet JVC, Mr. Ch.Ganzorig, General Director of Erdenet JVC, Mr.Z.Ganbaatar, Vice Director for Production, Mr. Yo.Bayarsaikhan, Deputy Director for Social Issues, held a press conference.

Erdenet is the key contributor to the development of the Mongolian economy and it has the most up to date technology and facilities and highly trained human resource which secure consistent and continuous production. During its 30 years of history, it enriched 580 million tons of copper ore ad produced 3.4million tons of copper concentrate. As for the first 8 months of 2008, it has profit of 115 billion MNT and provided 512 billion MNT to the state and local budget. Read the rest of this entry »

MP D.Zorigt, the deputy head of the Examining sub-committee on Budget Expenditure of the State Great Khural, initiated a proposal to add on the budget income by withdrawing 25.3 billion MNT, the profit difference for the Mongolian side, from the profit of year 2007 of the Mongolain Russian Joint Enrichment Factory “Erdenet”.

Q: MPs are interested in this money. Why the budget income from Erdenet was decreased in the previous years?
MP D.Zorigt: Last year, according to the state budget approved by the State Great Khural, 109 billion MNT from Erdenet Factory was legalized as the profit share of the Mongolian 51% hold. But the Mongolian delegates discussed this issue at the Committee Meeting of Erdenet and decreased this amount by 25 billion MNT. It was illegal act. It can’t be decided like this way. Therefore, I thought that this illegal act must be stopped and the money shall go to the state budget.
Q: What is the issue of another 60 billion MNT?
MP D.Zorigt: This money is allocated for the factory as the innovation to the factory. It has been talking more than 10 years and it is still not started yet. The result of this work must be exposed to the public openly. Erdenet is the property of people of Mongolia. But it became closed factory. It must be open to public.

By Nadia Popova

MOSCOW — Billionaire Alisher Usmanov’s Metalloinvest on Friday joined the race for the Udokan copper field, the country’s largest untapped source of the metal, just a few hours ahead of a bids deadline.

The stakes in the fight for Udokan in eastern Siberia, estimated to hold 20 million tons of copper reserves, are high as the country’s richest oligarchs vie to win the rights to the lucrative field in a Sept. 14 tender.

The tender will likely become another key metals battleground as Metalloinvest, half-owned by Usmanov, and Oleg Deripaska’s Basic Element, another Udokan bidder, could use the field’s assets as leverage in the multiplayer struggle for control of the country’s biggest mining firm, Norilsk Nickel.
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