Rohan Jaitley: Central Gov't Standing Counsel for Justice
25.03.2011, NEWSWIRE, Issue 160
1. BUSINESS COUNCIL of MONGOLIA
NewsWire
www.bcmongolia.org
info@bcmongolia.org
Issue 160, March 25 2011
NEWS HIGHLIGHTS:
Business:
Prophecy Resource ready to sell Ulaan Ovoo coal to Russia and beyond from April;
Hunnu Coal reports majority interests in 13 projects in Mongolia;
Aspire Mining pleased with coal quality data;
Assay results indicate “strongly mineralized zone”, says Meritus;
Denison announces increase in 43-101 Estimated Resources at Hairhan;
Fitch rates Winsway Coking Coal 'BB'; outlook stable;
Entrée Gold announces USD7 million budget for joint venture work programs;
Manas Petroleum could spud first well this year;
Monnis Group President joins Prophecy board of directors;
Petro Matad shares jump;
Bechtel likely choice for Sainshand complex consultancy;
Mongolia Growth Group announces private placement offering;
Interpol alert against former XacBank official.
Economy:
As source of resources, Mongolia has the upper hand, says mining body chief;
Central Bank buys 64.7% more gold y-o-y;
Development Bank needed new rules after law was passed;
Some views on how to make a success of the Development Bank;
Tripartite agreement marks global first in national grievance redressal mechanism;
OT’s younger copper cousin waiting to be discovered;
Report sees “phenomenal growth” in Mongolian mining output;
Australia-Mongolia trade relations have huge potential to increase;
Mongolia in the spotlight;
Deputy PM seeks expert views before beginning TT selection talks;
Plans to lift restrictions on insurance companies’ investments;
With aviation fuel prices rising, flying may cost more;
Experimental program begins to help citizens find jobs;
Cashmere price rises;
Economic entities to be counted next month;
Korea, Mongolia to initiate agricultural cooperation;
S. Korea, Mongolia plan joint venture to produce “clean coal”;
Friedland bullish on copper after Japan quake;
Rio Tinto CEO says price instability to rule in the short term.
Politics:
Anti-Corruption Authority Chief sent to prison;
MPs wait for copy of court decision;
Speaker’s advisor blames politics for poor governance;
Mongolia pledges to erect solar power plants, portable wind turbines;
UNEP report warns Mongolia of critical water shortage;
Experts urge quick action to face water shortage threat;
2. Not enough water for 100,000 Apartments project;
Leaders see merit in having two Houses of Parliament;
Ambassador Addleton visits Mongolians on Afghan air base;
Team finds out what ninja mining does to pastureland;
Minister urged to reconsider views on amending Criminal Law.
*Click on titles above to link to articles.
BCM MONTHLY MEETING NOTICE
BCM‘s next monthly meeting for members will be Monday, March 28, 2011 at 5 PM at the KEMPINSKI
HOTEL KHAN PALACE, 2nd floor, Altai Ballroom. Parking will be reserved in front of the hotel for
BCM Members.
Our bilingual meeting will feature the following presentations:
- Mr. Pius Fischer, Ambassador of Germany - ―Update on Mongolia-Germany business development‖;
- Mr. John Lee, CEO, Prophecy Resource - "Presentation on Prophecy Resource";
- Ms. Ts. Ariunaa, Executive Director, Arts Council of Mongolia - ―Arts and Creativity‖; and
- Mr. R. Bat-Erdene, Senior Officer, Erdenes Tavan Tolgoi - "Update on Erdenes Tavan Tolgoi
Project‖.
A networking reception will be held for all attendees immediately following the business portion of
the meeting in rooms ―Khuvsgul‖ and ―Hustai‖, also on the 2nd floor, Kempinski Hotel Khan Palace.
Business
PROPHECY RESOURCE READY TO SELL ULAAN OVOO COAL TO RUSSIA AND BEYOND FROM APRIL
Prophecy Resource Corp anticipates exporting approximately 520,000 tons of coal in 2011 from its
Ulaan Ovoo mine in Mongolia, which was fully commissioned last November. To date, 333,760 tons
of in-situ "export-quality" coal has been exposed at the site and is ready to be mined. The company
has already begun the trucking of export coal from Ulaan Ovoo to the railway 120 km from the
mine. Prophecy said it expects 5,000 tons of export coal to be on stock, ready for rail loading by
April 1, which will then be delivered to the Russian domestic market, as well as to the Russian
Eastern Sea coal terminals for shipment to overseas customers.
Since commissioning the mine last year, Prophecy has transported and sold 27,597 tons of 3,500
kcal/kg coal to local power plants and companies in Mongolia, and anticipates exporting
approximately 520,000 tons in 2011. By the end of the year, the company plans to ramp up
production to a rate of 1 million tons per year, and reach positive operating cash flow by the
second quarter.
Prophecy controls over 1.4 billion tons of surface minable thermal coal in Mongolia, and has nickel
and other mineral properties in Canada.
Source: Prophecy Resource Corp.
HUNNU COAL REPORTS MAJORITY INTERESTS IN 13 PROJECTS IN MONGOLIA
The Directors‘ report for Hunnu Coal Limited and its subsidiaries for the period from incorporation
on 19 August 2009 to 31 December 2010 says the company has majority interests in 13 coking and
thermal coal projects in Mongolia. To date the company has reported total JORC coal resources of
414Mt on its Unst Khudag Thermal Coal Project and the Tsant Uul Coking Coal Project. Exploration
effort so far has been focused primarily on these two and the Tenuun 2 Coal Projects, with
aggressive drilling programs undertaken on each. Geophysical survey and mapping works were
completed on other projects.
A total of 22,665 meters of drilling for 258 boreholes was completed during 2010 on the Unst
Khudag project, and another 28,029 meters of drilling for 187 holes on the Tsant Uul project, where
eight drilling rigs are currently operating. Such rigs are being mobilized to test coking coal targets
identified at Tsokhio and Khuree-2 Coal projects in the South Gobi Province.
Read more…
3. During 2010 the company completed a transaction resulting in its owning 70% of the Zuun Gol and
Ar Zuun Gol Coal projects. Exploration on these projects should begin in the second quarter of
2011, targeting coking coal prospects.
The company‘s several coking and thermal coal projects are located in South and Middle Gobi
regions and the Gobi-Altai and Eastern Mongolia regions. It is currently drilling at the Tsant Uul
project and will commence drilling in the next few months at the Khuree-2, Baruun Tsokhio and
Buyan projects.
No dividend was paid or declared by the company during the period under report.
Source: Hunnu Coal
ASPIRE MINING PLEASED WITH COAL QUALITY DATA
Aspire Mining Limited has received additional coal quality data relating to the company's Ovoot
Coking Coal Project's 2010 resource drilling program. It has now received two batches comprising
124 samples or 36% of the total samples to be received, and the combined results for the two
batches continue to demonstrate a very high theoretical yield of 87% to produce a simulated
product with a 7.7% ash content and a CSN of 8.7. There is no thermal coal fraction. With such low
ash results it is likely that not all of the raw coal will need to be washed to produce a high quality
blended product.
The company has mobilized and commenced its 2011 exploration program at the project. The initial
drill rig is currently infill drilling an appropriate site to establish a "Direct Ship Ore" operating open
pit. A second drilling rig will be mobilized by the end of March to target the resource extension
drilling targets presented by the recently completed 2-D seismic programs.
Source: Aspire Mining
ASSAY RESULTS INDICATE “STRONGLY MINERALIZED ZONE”, SAYS MERITUS
Meritus Minerals Ltd. has received assay results from another five drill holes from the winter drilling
program at Gutain Davaa, Toordogiin Shil Prospect. Results from previously reported three and
currently reported two holes suggest that there is a strongly mineralized zone plunging steeply
northeast.
Source: Meritus Minerals Ltd
DENISON ANNOUNCES INCREASE IN 43-101 ESTIMATED RESOURCES AT HAIRHAN
Denison Mines Corp. has announced that an updated resource estimate has been prepared in
accordance with National Instrument 43-101 (NI 43-101) for its Hairhan deposit held by the Gurvan
Saihan Joint Venture (GSJV) in Mongolia. Denison holds a 70% interest in the GSJV with the
Mongolian state entity Mon-Atom LLC holding 15% and the Russian concern Geologorazvedka holding
the remaining 15%. The GSJV holds six exploration licenses, including Hairhan, totaling 181,574
hectares in the South Gobi region of Mongolia.
The updated NI 43-101 resource incorporates results from drilling in 2007 and 2008 in the central
portion of the Hairhan deposit. This drilling comprised 278 holes totaling 46,000 meters
concentrated in known mineralized areas in order to close drill spacing and to support detailed
resource estimation. As a result of the drill programs, which increased the total drilling at Hairhan
to over 118,000 meters, uranium contained in the Indicated Resources increased 151% and in
Inferred Resources 67% over the resources reported previously in the report titled "Technical Report
on the Uranium Exploration Properties in Mongolia" dated February 27, 2007, issued by Scott Wilson
Roscoe Postle Associates Inc. The next phases being planned by the Company include advancing the
Hairhan exploration license to a mining license, designing a semi-commercial scale acid ISR plant,
and initiating site construction and development activities in late 2011 and into 2012.
Read more…
The implementation of the Hairhan development and testing program, as well as continued
exploration on the other properties held by the GSJV, is contingent upon resolution of outstanding
issues arising from enactment the Nuclear Energy Law of Mongolia in mid 2009. Foremost among the
issues that the Nuclear Energy Law has raised are matters relating to ownership and structure of
the GSJV and its projects. The Company remains hopeful that these important issues will be
resolved in 2011 so that the planned programs can commence.
Source: Denison Mines Corp.
FITCH RATES WINSWAY COKING COAL „BB‟; OUTLOOK STABLE
Fitch Ratings has assigned Winsway Coking Coal Holdings Limited a Long-Term Foreign-Currency
Issuer Default Rating (IDR) of 'BB' with a Stable Outlook and a foreign-currency senior unsecured
4. rating of 'BB'. The agency has also assigned an expected rating of 'BB(EXP)' to Winsway's proposed
senior unsecured notes. The proceeds will be used to purchase rolling stock, build railway-related
infrastructure to increase transportation capacity and to finance investments in upstream coal
resources.
"Winsway's ratings are supported by its unique business model and solid market position as a virtual
monopoly in the transportation of Mongolian coal into China. The company's credit strengths are
underpinned by its strategic logistics assets at Sino-Mongolian border crossings, strong relationships
with China's railway authorities, as well as back-to-back inventory management," says Ms. Ying
Wang, Director in Fitch's Asia-Pacific corporates team. "Winsway's ratings are constrained by its
relatively small operating scale, which puts it in line with the size of other Fitch-rated Chinese
industrial corporates in the 'BB' category. Furthermore Fitch expects negative free cash flow from
2011 to 2013 due to increasing capex," adds Ms. Wang.
Read more…
Winsway maintains a leading market position in the long haulage land coal imports from Mongolia to
China's key coking coal markets. The company's competitive edge is built upon its early mover
advantage to secure strategic land resources for its coal logistics parks at key customs check-points
at the Sino-Mongolian border crossings.
In 2010, Winsway procured 9.5 million tonnes of Mongolian and seaborne coal and was responsible
for 55% of the Mongolian coal exports to China, according to the company's data. Winsway's
competitive advantage is enhanced by its access to key railway capacity, a major challenge in the
transportation of Mongolian coal to different markets in China.
Source: Reuters
ENTRÉE GOLD ANNOUNCES USD7 MILLION BUDGET FOR JOINT VENTURE WORK PROGRAMS
The Entree and Oyu Tolgoi LLC joint venture has budgeted USD7 million for exploration and
development work on the JV ground within the Lookout Hill Property. The work program for 2011
includes a combination of exploration and geotechnical drilling. The exploration team is focusing
on high priority targets that could further extend the known mineralized system with a budget of
USD5.5 million. The USD2.1 million geotechnical drilling program is related to future development
of underground operations on the Hugo North Extension ore body.
Proposed exploration work includes approximately 16,000 meters of drilling and is planned to focus
on testing extensions to the Hugo North Extension and the Heruga deposits. The Hugo North
Extension deposit is open for 7 km to the north along the OT Trend (to Ulaan Khud), and the Heruga
deposit is open at depth, to the west, and to the south. Additional drilling will test other
geophysical targets to the south of Heruga on the Javhlant license.
Entrée's President & CEO, Mr. Greg Crowe, commented, "Advancement of the Oyu Tolgoi mining
complex is proceeding at a fast pace, and the Entree-OTLLC JV Ground is an integral part of future
planning. This is evidenced by the focus on Shaft 4, currently planned to be sunk on the joint
venture ground to access the rich Hugo North Extension as well as exploration programs designed to
test the extension of the Heruga deposit ten km to the south."
Source: Entrée Gold
MANAS PETROLEUM COULD SPUD FIRST WELL THIS YEAR
Manas Petroleum Corp. says in its just issued annual report for the fiscal year ended December 31,
2010 that it does not expect any need to arise for additional funding from external sources to fund
its operations in 2011. Tracing the course of its work in Mongolia in 2010, the company says it re-
interpreted existing geological data and planned for a gravity survey to further define the location
of lines for the recently completed seismic campaign on Blocks 13 and 14. It also collected data
from a total of 451 existing wells drilled in the Zuunbayan and Tsagaan Els oil fields area and in
prospects. In August it entered into a contract with DQE International Tamsag (Mongol) LLC, a
subsidiary of CNPC Daqing Petroleum, for the acquisition of 300 km of 2D seismic on Blocks 13 and
14 for an aggregate total of USD1,050,000. The 2010 seismic acquisition program for block 13 and
14 was completed in November without incident. After interpretation of the full dataset, the
company will decide whether to drill one or more exploration wells or to acquire 3D seismic to
define the drill prospects in better detail.
Depending on this decision, the first well could be spudded in 2011. Other plans for 2011 call for
the acquisition of another 833 km of data at a cost of approximately USD3.35 million, including 303
km on Block 13 and 530 km on Block 14.
Source: Manas Petroleum Corp.
5. MONNIS GROUP PRESIDENT JOINS PROPHECY BOARD OF DIRECTORS
Mr. Chuluunbaatar, President and Chairman of the Monnis Group of Companies, has been appointed
to the Prophecy Resource Corp. Board of Directors. Monnis is one of Mongolia's largest industrial
holding companies, and with over 1,000 employees and 12 subsidiaries, has become a national
leader in insurance, construction, logistics, technology, real-estate, geological services, mining
support services, energy, automobile and automotive parts distribution, international freight
forwarding, foreign trade, air services, communications, and corporate finance advisory services. By
practicing good corporate governance and social responsibility, Monnis has become one of
Mongolia's most respected and revered business entities.
Mr. John Lee, Chairman of Prophecy, has said, "Prophecy and Monnis have already forged strong
partnerships and are both committed to advance Ulaan Ovoo coal mining and Chandgana power
plant projects to better the country of Mongolia. I am pleased to appoint Mr. Chulunnbaatar to the
Board of Directors and welcome his greater involvement in Prophecy."
Source: Prophecy Resource Corp.
PETRO MATAD SHARES JUMP
Shares in AIM-quoted oil and gas explorer Petro Matad have jumped by more than one-third after
the Mongolia-focused explorer said that the reinterpretation of its seismic data had led to an
increase in the resources of the Davsan Tolgoi prospects. Petro Matad drilled three wells on the
Davsan Tolgoi anticline last year and that has taken the number of prospects to 18 and offered
three leads. This has helped to develop the 2011 drilling program.
Source: ShareCast News
BECHTEL LIKELY CHOICE FOR SAINSHAND COMPLEX CONSULTANCY
Mr. Ch.Khashchuluun, Chairman of the National Development and Innovation Committee, has
indicated that Bechtel Corp. has been chosen to work as consultant to setting up the Sainshand
industrial complex. A formal announcement of the selection will be made by the Ministry of Finance
after some procedural requirements have been met. The proposed industrial complex will have
processing and refinery units for output from, among other places, the Tavan Tolgoi deposit, with
which it will be connected by rail.
Bechtel was considered for its valuable experiences in the involvement of the Industrial Complex in
Saudi Arabia, English Channel that connects France with the Great Britain, as the evaluation group
of the bidding indicated.
Source: Zuunii Medee
MONGOLIA GROWTH GROUP ANNOUNCES PRIVATE PLACEMENT OFFERING
Mongolia Growth Group Ltd. has planned a non-brokered "commercially reasonable efforts" private
placement offering of common shares to raise gross proceeds of up to CAD10 million with a CAD5
million overallotment for aggregate proceeds of up to CAD15 million. The shares will be priced at
CAD1.32. The Company intends to use the proceeds to fund the recently announced insurance
company, purchase leasable real estate, take advantage of investment opportunities and general
corporate purposes.
Source: www.mongoliagrowthgroup.com
INTERPOL ALERT AGAINST FORMER XacBank OFFICIAL
Interpol has issued an alert against a former XacBank branch manager who is charged with
embezzling MNT120 million of the bank money between August 2001 and November 2002. She
managed to leave the country before the bank could complete investigations and seek police help.
Source: Zuunii Medee
6. SPONSORS
Khan Bank Eznis Airways
Kempinski Hotel Khan Palace Mongolian National Broadcasting
Mongolian Star Melchers
ECONOMY
AS SOURCE OF RESOURCES, MONGOLIA HAS THE UPPER HAND, SAYS MINING BODY CHIEF
Mr. T.Naran, Director of The Coal Association of Mongolia, has called for a quick end to the present
arrangement whereby ―our trade ends at the China border‖. Inner Mongolian companies buy all the
coal and then offer it at the Tianjin markets, making a 200%-300% profit. The Tianjin port last year
received over 30 million tons of coal from Inner Mongolia, at least half of which was from Mongolia.
Mr. Naran is unhappy that Mongolian companies lose so much money because they cannot carry the
coal beyond the China border. He also regrets that all Mongolian coal is sold ―directly from the pit,
at a flat rate as we do not have gradation and classification facilities‖. The association is
negotiating with the Chinese to be allowed to carry coal to Tianjin.
Discounting all talk that this could pose a danger of Mongolia getting to be too dependent on China,
Mr. Naran has said, ―We have to judge if there is any truth in this or is this said only to create fear?
I think it would be saner to say that as the provider of coal, it is rather Mongolia that will keep
other countries dependent on it than the other way round. China can keep its economic super
power status only on a steady supply of coking coal from Mongolia.‖ Indeed, the Mongolian position
gets stronger as major economies like Japan, Korea and India clamor to buy coal from Mongolia.
―Indeed, they are in competition for this, and as buyers, all these powers are dependent on us to a
certain degree.‖
Source: The Mongolian Mining Journal
CENTRAL BANK BUYS 64.7% MORE GOLD Y-O-Y
The Central Bank bought 270 kg of gold from mining companies and citizens up to the close of day
on March 21, which was 174.6 kg or 64.7% more than in the same period last year. The figure had
stood at 252 kg at the end of February. This was 59% of the gold mined by companies excepting
Boroo Gold LLC.
Source: News.mn
DEVELOPMENT BANK NEEDED NEW RULES AFTER LAW WAS PASSED
Explaining the need for the new set of rules for the Development Bank approved by the Government
at a special meeting on March 18, Mr. G.Batkhurel, Head of Administration at the National
Development and Innovation Committee, said the existing rules had been adopted before
Parliament passed the law on the Bank. After this law was passed, it became necessary to amend
some rules so that there would be no contradiction between them and the law. For example, the
7. Government had restricted the amount of loan the bank could issue to 20% of its total capital. This
is what commercial banks do, but is not apt for a development bank, whose main purpose is to
finance large and long-term projects, to the total exclusion of small business loans and personal
loans of any kind.
Mr. Batkhurel explained that the general budget of 2011 has allocated MNT16.4 billion for the
capital of the Development Bank. It has also fixed MNT1.9 trillion or 23.3% of the GDP of Mongolia
as the upper limit of loans the Development Bank can grant this year. The law allows the
Government to guarantee repayment of loans 50 times the equity capital, which works out to
MNT830 billion this year. However, Parliament would every year decide how much loan can be
issued and the amount of guarantee the Government will give will vary according to the quantum of
the bank‘s capital.
Source: English.News.mn
SOME VIEWS ON HOW TO MAKE A SUCCESS OF THE DEVELOPMENT BANK
Two bankers, an academic and a columnist were asked for their views on what the Development
Bank can actually achieve in prevailing conditions. Will it become a den of corruption or will it open
up a path to transparent development? Their views are given below.
Z.Shagdarsuren, General Secretary of the Mongolian Banks Association: Independent members must
be in a majority on the Board. Politicians have a habit of corrupting good intentions, so they should
be kept away from the bank‘s work. Before the law was passed in Parliament, a show was made to
seek the views of commercial banks, but the papers were very cleverly sent just on the eve of
Tsagaan Sar and the law was passed soon after, giving us no time to compile data and offer any
suggestion. I am not convinced the choice of the management team will be done solely on the basis
of merit. So far nothing has been revealed of the identity of the applicants for the job, not even
how many are interested. We can only wonder why there should be so much secrecy. The only thing
positive so far has been that there are several non-Mongolians in the administrative committee. If
they are not allowed to exercise independent judgement, politicians will barge in, raising risks of
corruption and dishonesty.
Read more…
B.Oyubilegt, essayist and commentator: Its role has been conceived to be very important for the
economy and so everything has to be left to economic and financial experts, without political
interference. There must be stronger legal safeguards to protect the operational independence of
the Development Bank, to make sure it helps in economic development and is also successful as a
bank. Also, there must be scope for competition from commercial banks.
Dr. L. Oyun, Professor of Economics at the National University of Mongolia: We are moving towards
a skewed path of economic development, with the mining boom leaving all other sectors behind.
The Development Bank will be the one to provide funds for private businesses who cannot otherwise
hope to work on large and promising projects for the country. This should help those outside the
mining industry and in rural areas.
L.Tur-Od, Vice-Director of XacBank: The bank will be using taxpayers‘ money, which makes it
imperative that its transactions are kept transparent. The regulations must reflect what we have
learnt from how banks failed in the past. Incidentally, I don‘t see any further need for the State
Bank. The Development Bank will provide funds for infrastructure and such big projects, while the
job of providing credit to others should be left to privately owned and run commercial banks, with
no role for the State Bank in this.
In a separate interview, MP and former Central Bank Governor O.Chuluunbaatar has said he sees no
need for the Development Bank in Mongolia, and feels ―Ministers and important people will run
their own business through it, as has been the experience in many other countries‖. However, he is
willing to ―wait for a while before passing a final judgment‖.
Source: Zuunii Medee, Ardiin Erkh
TRIPARTITE AGREEMENT MARKS GLOBAL FIRST IN NATIONAL GRIEVANCE REDRESSAL MECHANISM
The Government, civil society, and business signed a landmark tripartite agreement on March 22 to
establish a national mechanism for dispute resolution, conflict mitigation, and education on mining
issues. Mr. Ch. Khurelbaatar, Chair of the Cabinet Secretariat, signed on behalf of the government;
while Ms. J. Zana, Head of the Civil Alliance Center, and Mr. Kh. Ganbaatar, Vice President of the
Mongolian Employer‘s Federation (MONEF), signed for civil society organizations and the business
sector respectively.
The agreement follows the memorandum of understanding signed by the three parties on December
31 2010 to explore the possibility of establishing such a mechanism. The parties will seek to
8. establish a national entity to help mitigate the potential for conflicts, resolve grievances in mining
and use of natural resources, educate the public on mining issues, and provide mechanisms for
citizen dialogue and community participation. This is the first time in the world that a country has a
mechanism supported by the three main stakeholders -- industry, civil society, and government --
for non-judicial conflict resolution in mining and natural resources issues, on levels national to
local.
Read more…
At the signing ceremony at Government House, Prime Minister Batbold said, ―Mongolia has been
going through a lot of changes in recent years, with results both good and bad. Conflicts and
misunderstandings have stood in the way of success in some cases. Therefore it is necessary to
establish this system for nationwide dispute resolution and prevention. I shall personally ensure
that this agreement is followed.‖
The agreement calls for parties to conduct joint trainings to educate citizens on the life cycle of a
mine, its potential impact, and how community members can engage in the process to take
advantage of possible opportunities. The tripartite entity will also provide trainings on conflict
resolution for signatory organizations from industry, civil society, as well as local government,
based on materials prepared with assistance from USAID.
Mr. Kh. Ganbaatar of MONEF declared, ―By signing this agreement, we—industry, government, and
civil society—will stop being rivals on each issue regarding natural resource use. This agreement
will ensure companies are at the table to mediate disputes, and to collaborate to come to a
unified, mutually beneficial decision.‖
Representing civil society organizations supporting the agreement, Ms. Zana said, ―We have tried
many ways to have our voices heard, some more successful than others. Now, this tripartite
agreement will enable citizens to have their say and reach consensus on natural resources on a
local level, in all 334 soums and 21 aimags. We are thankful to USAID for assisting us in making this
agreement a reality.‖
In the coming months, the signatories will establish a national committee with equal representation
of the three parties to implement the objectives of the agreement, with ongoing technical
assistance from USAID.
Source: EPRC/USAID
OT‟S YOUNGER COPPER COUSIN WAITING TO BE DISCOVERED
Ivanhoe is often referred to in Mongolia as ―the one that got away‖. 10 years ago, BHP sold what is
now Oyu Tolgoi to Ivanhoe at a mere fraction of its current USD15 billion value. Rio Tinto stepped in
as the strategic partner (and largest shareholder) to Ivanhoe and lender of last resort. BHP and
Ivanhoe have since JV‘d in Mongolia and now discovered a new copper/gold mineralization zone, in
Rio‘s backyard only 10 km north of OT leaving the giant wondering what might be on the other side
of the license boundary.
The exploration for copper in southern Mongolia is still all about OT‘s success, but increasingly
attention is being drawn to the range of highly prospective license areas extending along the world-
class copper belt to the north. A select number of Western-based exploration companies are finding
increasingly prospective areas that have so far gone largely unnoticed outside of Mongolia. And we
are seeing scope for investors to participate in these opportunities in search of the ―next OT‖.
The line goes ―where there‘s smoke, there‘s fire‖ and it‘s not unrealistic to believe that OT‘s
younger copper cousin is waiting to be discovered, potentially sooner than some may think.
Source: ResCap
REPORT SEES “PHENOMENAL GROWTH” IN MONGOLIAN MINING OUTPUT
Mongolia will exhibit one of the world's fastest growing mining sectors with phenomenal growth of
gold, copper and coal production, says Mongolia Mining Report Q2 2011 from Business Monitor
International. ―We expect that the country's mining sector value will grow to USD15.4 billion by
2015, marking a fivefold increase from 2010. The majority of this increase will occur in 2013 and
2014 as the gargantuan Oyu Tolgoi copper and gold mine comes online,‖ the report says.
It predicts ―a dramatic reversal‖ of the trend of static or declining growth in mining output, with
rapid rates of growth across the mining complex over the coming years, especially in 2013. From
2011 to 2015 the report forecasts an annual average growth rate of 31.2% in gold output to reach
791kozpa (thousand ounces per annum), and 40.1% growth in copper production to 720ktpa
(thousand tons per annum). It also sees an annual average growth rate of 62.3% in coal output,
reaching 16.2mtpa (million tons per annum) by 2015.
This increase will be driven by South Gobi, a subsidiary of Ivanhoe, which is increasing production at
9. Ovoot Tolgoi, the country's largest coal mine, to 6.5mtpa by 2014. Again, this will reverse the
decline experienced over the last three years. There are substantial upside risks to the coal outlook
as the Tavan Tolgoi mine, currently owned by the Mongolian government, is due to commence
output by 2015. Aside from these developments, Mongolia has great potential for further growth in
mining output across all metals as very little of the country has been mapped. Therefore, it is likely
that significant deposits of minerals are yet to be discovered.
Read more…
Mongolia has made significant progress over the last decade to improve its business environment.
Recently, however, there has been a slight deterioration in the country's business environment as
the government suspended almost half of the country's mining licenses on environmental grounds,
having previously cancelled two exploration licenses for the Canadian miner Khan Resources.
Mongolia's mining sector is dominated by Rio Tinto and Ivanhoe, but other smaller companies are
active including Centerra Gold and Erdene Gold, both of which have substantial exploration
projects. ―We expect the mining sector to become more fragmented going forward with numerous
companies tempted by the country's mineral potential. Indeed, in addition to Rio Tinto, we expect
other large-scale miners to enter the Mongolian mining sector, such as Vale, tempted by the
country's considerable undeveloped coal reserves‖ the report says.
Source: Fast Market Research
AUSTRALIA-MONGOLIA TRADE RELATIONS HAVE HUGE POTENTIAL TO INCREASE
Australia and Mongolia recently signed a number of agreements to increase bilateral business and
educational cooperation. The following is the text of an e-mail interview. In which Mr. Li Narangoa,
a professor in the School of Culture, History and Language at the Australian National University,
discussed Australia-Mongolia relations.
What is the extent of existing trade between Australia and Mongolia?
LN: Trade between Australia and Mongolia has been small, with a total value of about AUD25 million
in 2010. Though Australia and Mongolia established diplomatic relations in 1972, a serious trade
relationship began only in the 1990s, when Mongolia introduced a democratic political system and
free-market reforms. Trade mainly comprises the export of mining equipment and civil engineering
services, along with a very limited volume of agricultural products such as wine, beef and lamb sent
from Australia to Mongolia.
What are the areas of greatest potential for further development between the two economies?
LN: The greatest potential for further development between the two countries is the mining and
resources sector. Australia and Mongolia are both rich in minerals and energy resources. Mongolia is
set to become a mining giant in the Asia-Pacific region, and Australia's considerable experience in
mining puts it in a position to assist Mongolia in realizing its potential. The two governments set up
a joint working group to discuss collaboration in the mining and energy sectors in 2007, and the
group now meets once every two years. In 2008, Mongolia set up an embassy in Australia. During a
visit by the Mongolian Prime Minister to Canberra in February 2011, a memorandum of
understanding was signed on vocational education cooperation, aimed at helping Mongolia build the
capacity of its mining workforce.
Read more…
Roughly 20 Australian companies are already involved in mining and energy exploration in Mongolia
-- including Rio Tinto, BHP Billiton and Leighton -- and they hold significant mineral leases there.
Moreover, a growing number of Australian companies are interested in doing business in Mongolia.
The Australian government has recognized Mongolia's economic potential, and the Australian Trade
Commission will open a permanent office in Ulaanbaatar in 2011.
Beyond trade, what are the opportunities and challenges facing the bilateral relationship going
forward?
LN: There are increasing interests in political and scientific exchanges as well as in sharing
expertise in education and agriculture. Three additional agreements were signed covering these
aspects during Mr. Batbold's February visit. By providing scholarships, Australia's development
cooperation program has been contributing to Mongolia's human resource development. Mongolian
students without a governmental scholarship, however, find it very difficult to get an Australian
visa because of the stringent conditions that Australian immigration procedures require -- especially
proof of financial support for their studies in Australia.
Both Mongolia and Australia are rich in minerals such as copper, gold, coal and uranium, and they
have strong incentives to collaborate in the mining and energy sector, as mineral resources make up
a high percentage of their trade incomes. But that means that they are also potential competitors
for the same markets in the Asia-Pacific region -- China and Russia in particular. That will present
10. challenges to both countries' efforts to collaborate in areas of common interest. For Mongolia, the
priority is to create a stable political and legislative environment for Australian investors.
Source: World Political Review
MONGOLIA IN THE SPOTLIGHT
Everyone seems to want a piece of the Mongolian coal action these days. And it is not just the
Chinese market – big as it is – that beckons. There is also the growing prospect of railing coal
through Russia to shipping on the Pacific coast.
Just two weeks ago Thai coal giant Banpu injected AUD45 million into Hunnu Coal as a means of
getting a foothold in Mongolia. The move was described as a low-risk way for Banpu to familiarize
itself with the Mongolian coal industry. Now Aspire Mining reports that commodity trading house
Noble Group had acquired a further 18 million shares, giving it an undiluted 8.6 per cent stake in
Aspire. The Australian junior has its wholly-owned Ovoot coking coal project in northern Mongolia
which has a maiden resource of 330 million tons.
It was just six weeks ago that Noble formed a strategic alliance with another Australian coal
hopeful in Mongolia, Xanadu Mines. The deal did not affect Xanadu‘s Galshar and Khar Tarvaga
thermal coal projects, but opened the way for the new partners to find other energy and mineral
projects in the landlocked northern Asia country.
And Fortescue Metals Group had an attempt to get a foothold in Mongolia with its unsuccessful bid
to be short-listed for the Tavan Tolgoi project, the world‘s largest known untapped coking coal
deposit. The successful companies for the short list included Vale, Xstrata, AOA Russian Railways,
Shenhua Group, ArcelorMittal and Peabody Energy.
Source: The Australian
DEPUTY PM SEEKS EXPERT VIEWS BEFORE BEGINNING TT SELECTION TALKS
First Deputy Prime Minister N.Altankhuyag heads the five-minister working group that will soon
begin talks with the six shortlisted foreign companies or consortiums to select the strategic
investor in the Tsankh area, the name given to the western part of the extensive Tavan Tolgoi
deposit. He recently invited former political leaders of standing, mining specialists, academics and
others to a meeting to learn more about the deposit, and to seek their views to better prepare
himself for the selection process.
Among those who came were Mr. P.Ochirbat, the first President of Mongolia; Mr. Ch.Khurts, a
former minister; Mr. D.Sodnom, a former Prime Minister; Dr.S.Avirmed, a professor at the Science
and Technology University; Mr. Battsengel, Executive Director of Energy Resources; Mr. D.Sugar,
head of the State Property Committee: Mr. Ch.Khurelbaatar, head of the Government Secretariat:
and Mr. B.Enebish, director of Erdenes MGL. Several of them expressed concern at the Government
decision to divide the deposit into two parts and develop them separately.
Source: Udriin Sonin
PLANS TO LIFT RESTRICTIONS ON INSURANCE COMPANIES‟ INVESTMENTS
The 17 insurance companies now active in the country have a total capital of MNT56 billion. They
receive MNT32 billion in premiums annually and paid out around MNT6.5 billion last year. The Law
on Insurance, passed in 1997and amended in 2004, bars an insurer from buying and selling shares,
from borrowing capital, and from offering its own shares to cover payment of claims. The way the
capital market is developing at present, it is natural for insurance companies to invest there instead
of keeping their money only in banks. Allowing them access to the capital market would benefit
both the companies and the market by offering them a chance to expand.
Agreeing that as times change, it is anomalous to restrict insurance companies‘ investment options
to banks and Government and Central Bank bonds, Mr. S.Ganbold, Chief of the Insurance Section in
the Financial Regulatory Authority, says a proposed Law on Investment Funds will help insurance
companies which need their capital to grow as they have to make regular payments to policy
holders. It will remove the bar on insurance companies trading in shares, and allow them to invest
their surplus capital profitably. ―But there has to be proper monitoring so that a fall in the stock
market does not cripple the companies,‖ Mr. Ganbold said. Businessmen have asked the
Government and the Prime Minister for quick action on the changes.
Source: Uls Turiin Toim
WITH AVIATION FUEL PRICES RISING, FLYING MAY COST MORE
With the rise in the price of aviation fuel, MIAT, Aero Mongolia and Eznis Airways are mulling
whether to charge more for passengers and freight. All three buy fuel from A Jet, a company that
11. imports it from Russia, and has increased prices three times since the beginning of the year. With
planes consuming over 650 liters per hour, even a small rise in price adds much to total costs. The
airlines are keeping a watch on what impact a recent Russian Government decision on oil prices
has. If A Jet does not reduce prices, the airlines may be forced to take an unpalatable decision.
Source: Undesnii Shuudan
EXPERIMENTAL PROGRAM BEGINS TO HELP CITIZENS FIND JOBS
An experimental program has been started in Songinokhairkhan district of Ulaanbaatar to help
disadvantaged citizens find jobs. The focus will be on those who have come out of prison, those
between 18 and 25 years of age without any professional qualification, and parents of unemployed
children. Depending on how it succeeds, the program is gradually to be extended to other districts
of Ulaanbaatar and to certain selected provinces.
Source: English.News.mn
CASHMERE PRICE RISES
The price of cashmere has been rising, as is usual in spring. It closed at MNT47,000 per kg last
month, but touched MNT56,000 during the last weekend at Emeelt market. Traders tracking the
movement of prices feel this could reach MNT60,000.
Source: Zuunii Medee
ECONOMIC ENTITIES TO BE COUNTED NEXT MONTH
The Government has a legal obligation to ascertain the number of active economic entities in the
country every five years, and the count this year will be made between April 15 and May 15.
Minister for Finance S.Bayartsogt heads the committee that will oversee the work. It held a meeting
last week to discuss aims and modalities, and to decide on orientation methods for those who will
do the job. The business census will determine the number, location and structure of economic
entities, ascertain their contribution to the economic and social development of the country, and
collect detailed information on their service and output.
The first count in 1991 was followed by a similar exercise in 1994, 1998 and 2006. At last count,
Mongolia had 52,900 economic entities in all.
Source: News.mn
KOREA, MONGOLIA TO INITIATE AGRICULTURAL COOPERATION
The Korea Mongolia Agricultural Development Preparation Committee plans to carry out eco-
friendly agriculture and livestock breeding on approximately 816,880 acres of land. The land in
Dornod province has stable, high-grade soil, clean rivers, abundant subterranean water, and the
hope for Korea is to turn this into an overseas food base, and for Mongolia to develop a center to
produce food for export.
The land in eastern Mongolia will be developed as a Special Economic Agricultural Zone. The two
countries will cooperate to promote the formation of communities for agriculture and livestock
farming, and preservation of ecosystems and forests. The stress will be on conservation of natural
resources, and running a model environment friendly center of agricultural economy, where human
beings and nature coexist and prosper together and at the same time develop agriculture and
livestock farming effectively.
Source: Korea IT Times
S.KOREA, MONGOLIA PLAN JOINT VENTURE TO PRODUCE “CLEAN COAL”
A memorandum of understanding (MoU) has been reached between South Korea and Mongolia to
engage in a "clean coal" development project that can improve energy efficiency of the fossil fuel
resource, the government said Tuesday in Seoul. The MoU calls for South Korea to transfer
technology related to upgrading coal quality used for heating and power generation through the
creation of a joint venture company and through cooperation in the development of coal mines and
other mineral resources in Mongolia. In addition, the agreement calls for eco-friendly dimethyl
ether production that can be used like diesel oil or liquefied petroleum gas.
Besides supporting projects allowing Mongolia to make better use of its energy resources, South
Korea will also seek to secure stakes in coal mines that can better insulate it from sudden hikes in
international prices and supply shortfalls. Korea Gas Corp., Korea Coal Corp., POSCO and SK
Innovation Ltd. are interested in developing resources in Mongolia which is estimated to have 12.6
billion tons of coal, roughly 1.5 percent of the world's total, and is rich in other resources.
Source: The Korea Herald
12. FRIEDLAND BULLISH ON COPPER AFTER JAPAN QUAKE
Copper and iron ore prices should remain high in the near future because of additional demand for
reconstruction in Japan after a devastating earthquake and tsunami, Ivanhoe Mines Ltd Chief
Executive Robert Friedland has said. As the country looks to rebuild in coming months and years,
prices for iron ore and copper should remain under pressure, he added. "What happened in Japan is
insanely bullish for copper," Mr. Friedland said at the Mines and Money conference in Hong Kong on
Wednesday.
Mr. Friedland, a billionaire mining magnate, said he also saw "profound implications" for copper
prices from long-term demand in China as the country builds a massive high-speed rail network and
increases the use of electric cars. "I'm a copper bull, not really a gold bull," he added.
Source: Reuters
RIO TINTO CEO SAYS PRICE INSTABILITY TO RULE IN THE SHORT TERM
Rio Tinto CEO Tom Albanese has said that commodity prices will average higher in the long term
than in the previous boom, but that there will be greater volatility. In a copy of a speech delivered
to the China Development Forum, he said that recent events such as the Japanese quake reinforced
this.
―While longer term we can expect real long run prices and margins for almost all minerals and
metals to average higher than the decade preceding the most recent six-year boom, we can expect
elevated price volatility in the near and medium term,‖ Mr. Albanese said. ―We have dubbed this
economic pattern the 'sawtooth economy'. Recent uncertainty in the markets, related to the Middle
East, problems with the Euro zone, and other factors, including the ongoing crisis in Japan,
reinforce this idea.‖
Mr. Albanese also spoke about progress at Rio Tinto‘s massive Simandou iron-ore project in Guinea,
where he said the company has already spent USD700 million. ―I've been very pleased with Chalco's
contribution to the project and the spirit of co-operation which has marked our work together,‖ he
said. Rio Tinto and State-owned Chalco agreed in July last year to jointly build the mine.
Source: The Mining Weekly
POLITICS
ANTI-CORRUPTION AUTHORITY CHIEF SENT TO PRISON
The Chief of the Anti-Corruption Authority (ACA), Mr. Ch.Sangaragchaa, was on Tuesday sentenced
to 2 years and 4 months of rigorous imprisonment by the Court of Chingeltei District after a two-day
trial. The Deputy Chief of ACA, Mr. D.Sunduisuren, and the Chief of its Executive Board, Mr.
U.Altangadas, have also received similar two-year terms. The head of the ACA Office, Mr.
G.Badarch, was acquitted.
The trial was held behind closed doors as the issue was deemed a state secret, and the court has
not revealed the charges against the accused, but one of them was a complaint of defamation from
Mr. S.Erdene, a DP MP. He has told media there were other charges, such as unauthorized
surveillance of other ACA officials, spending state funds for private use, and betraying state secrets
and slandering people.
Regarding his own case, Mr. Erdene said Mr. Sangaragchaa had said at a 2010 press conference that
some state high officials had been pardoned under the law of amnesty initiated by the President,
and ―thus avoided serving time for crimes they had committed‖. When a journalist had asked who
they were, Mr. Sangaragchaa gave the names of Mr. Erdene and former Minister for Emergency
S.Otgonbayar. ―The media reported this, and I felt defamed by Mr. Sangaragchaa‘s description of
me as a criminal who received amnesty‖.
Read more…
However, he did not immediately charge Mr. Sangaragchaa with defamation, instead sending him
the order of the Court of Bayangol District ―rejecting charges against me, and wanted to know why
he had said my acquittal was actually an amnesty. I wrote to him three times but received no
answer. I also asked him personally during a meeting of the Standing Committee on Justice, and he
refused to admit that he had done anything wrong‖, Mr. Erdene said.
―That is when I lodged a formal complaint that Mr. Sangaragchaa had defamed me by telling media
I was a criminal. I did not demand any monetary compensation. I just wanted him to retract his
incorrect statement about me,‖ Mr. Erdene said, adding that on the second day of the trial Mr.
Sangaragchaa ―sent word to me through my advocate that he regretted his words. I said he should
offer a written apology. This he did not do.‖
Source: Ardiin Erkh
13. MPs WAIT FOR COPY OF COURT DECISION
The Chief of the Standing Committee on Justice, Mr. D.Odbayar, has refused to comment on when
Parliament will discuss appointing a new Chief of the Anti-Corruption Authority. ―The court decision
has not yet been delivered to Parliament, so we cannot comment on the issue. Also, an appeal
against the verdict is likely, and Parliament may decide to wait for a final decision.‖ He denied that
the Speaker‘s meeting with the heads of four departments in the ACA on Wednesday had anything
to do with the court sentence. Several months ago, the Prosecutor General asked Parliament to
accept his suggestion to remove Mr. Sangaragchaa from office but MPs have made no progress on
the request.
Source: Ardiin Erkh
SPEAKER‟S ADVISOR BLAMES POLITICS FOR POOR GOVERNANCE
Mr. D.Davaasambuu, advisor to the Parliament Speaker, has said 80% of the population, many of
whom are pensioners receiving MNT100,000 per month and state officers earning MNT200,000, need
the MNT21,000 for each member of the family. This also gives everybody a tangible share of the
natural resources, but still, the practice cannot continue for much longer. However, scrapping such
a popular practice needs strength and will on the part of the Government, which will have to
override political compulsions. Mongolian politicians may not have the strength of purpose to take
the step, Mr. Davaasambuu fears, and adds, ―That is why many feel that a politician should not be a
minister.‖
He hears ―widespread criticism of the state service having little accountability and capability and of
the bureaucracy in it‖ and blames it all on ―politicians, who do not know anything about the sector
they run, making decisions that is good only for their career‖. Local government is lackluster as
officials ―are not appointed because of their qualification, but because of their party affiliation or
because of their closeness to an MP‖. Mr. Davaasambuu wants the Constitution to be amended so
that politicians do the political work, ―leaving governance to professionals‖. He wants the Prime
Minister to appoint only professionals as Ministers, and to ensure that both they and officers who
work under them show a higher sense of responsibility and accountability.
Read more…
―Today governance is poor as the head of each agency is appointed on political criteria, on how
much donation he gave and how much help he provided to a political party. This has to stop. With
so many MPs wanting to become Minister, there is only conflict,‖ he said. Calling the Mongolian
system of appointing directors of state owned enterprises ―one of a kind, not seen anywhere else in
the world‖, he says, ―It is basically appointing 6 persons who will force the company to buy
material, goods, and services from their friends and relatives. The head of the enterprise usually
agrees to pay a certain amount of tax during the year, however the money is earned and spent.
There is no independent audit. The Chairman of the State Property Committee (SPC) is the
chairman of several boards and he is under the control of politicians. This is the mechanism
established in 1997. You just have to see what cars and pens are used by SPC staff to understand
how the mechanism works.‖
Source: The Mongolian Mining Journal
MONGOLIA PLEDGES TO ERECT SOLAR POWER PLANTS, PORTABLE WIND TURBINES
Mongolia says it will erect solar power plants in the frigid Gobi desert. The Central African Republic
says it will expand its forests to cover a quarter of its territory. Mexico promises to slash carbon
emissions by 30 percent by the end of the decade. The pledges from dozens of developing
countries, compiled by the United Nations and released Monday, are voluntary, and many made
them conditional on financial and technical help from the industrial world.
But the list helps bring into focus demands by wealthy countries that everybody reduce greenhouse
gases to fight global warming. Scientists say carbon dioxide from industrial processes trap the
Earth's heat, causing climates to change in ways that could alter agriculture, raise sea levels and
contribute to more extreme weather. Most of the pledges now published by the U.N. climate
secretariat in Bonn, Germany, have been announced previously. But their listing in an official U.N.
document formalizes those pronouncements.
Mongolia, in addition to solar units in the desert, wants to give nomadic herders portable wind
turbines. It said it still needs to burn coal for home heating in a country were temperatures drop to
-40 degrees Celsius (-40 Fahrenheit), but pledged to install more efficient boilers.
Source: dailypress.com
14. UNEP REPORT WARNS MONGOLIA OF CRITICAL WATER SHORTAGE
A United Nations report warns Mongolia needs to invest about USD1 billion in the Tuul River
ecosystem and improve its national water management to provide clean water to its population.
Climate change and rapid urbanization have already sapped water resources in Mongolia, where
more than half the population have no access to clean water, according to the Urban Water
Vulnerability to Climate Change in Mongolia report, published by the United Nations Enviroment
Program (UNEP) and the Mongolia Water Authority on Tuesday.
The report found that Mongolia's average temperature has increased 2.1 degrees Celsius in the past
seven decades, accompanied by an increase in extreme temperatures and natural disasters such as
droughts, flooding and heavy snowfalls in recent years. The effects of climate change have been
compounded by rapid urbanization.
Read more…
Of Mongolia's total water consumption of 540 million cubic meters per year, over 80 percent is
consumed by the industrial and agricultural sectors and 20 percent by household use. About 80
percent of drinking water comes from aquifers. "If the status quo for water management in
Mongolia continues, the country will not be able to provide sustainable water resources for its
population under future climate change," said Mr. Young Woo Park, the Bangkok-based UNEP
regional representative for Asia and the Pacific.
The situation is particularly dire in Ulaanbaatar, where nearly 40 percent of the country's
population reside, most of them in "informal" settlements with little or no access to public utilities
including piped water. Because of widespread use of aquifers, the capital's groundwater tables have
dropped sharply over the past 50 years, UNEP said.
"A large part of the water resources for the city comes from the Tuul River, where continuing
ecosystem degradation will prove extremely costly in terms of water and other services lost," the
report said. Improved conservation of the Upper Tuul ecosystem will require an investment of
USD979 million dollars, it said.
The UNEP report also advised Mongolia to develop an integrated urban water management plan for
the Tuul River Basin, raising public awareness about saving water, build water recycling plants, and
improve the management of water supply utilities.
Source: Earth Times
EXPERTS URGE QUICK ACTION TO FACE WATER SHORTAGE THREAT
Specialists and representatives of water related organizations discussed issues of water exploitation
and water reserves at a meeting last week organized by the Water Office under the Ministry of
Nature, Environment and Tourism. Stressing that access to clean water was a basic human right,
they urged law makers to ensure that environmental exploitation and damage did not affect human
health in Mongolia. They noted that Mongolia would not be immune to the global threat of drinking
water shortage even though the country had rich reserves of water. Water use has to be regulated,
and laws on conservation must be implemented if this is not to happen. Man cannot be profligate
with nature‘s resources and turn abundance into famine.
The speakers said many present laws are not relevant and are often difficult to implement sensibly.
There is also no clear demarcation of administrative responsibility. Officials must be made
accountable for their failure to punish offenders against the law, including cancellation of licenses
if the holder organization neglects to follow provisions of the law. Also, they said, present laws
generally dealt with water use on a large scale only, but all misuse should be punishable as the
cumulative effect of many small violations can be considerable.
Source: Ardiin Erkh
NOT ENOUGH WATER FOR 100,000 APARTMENTS PROJECT
The Chief of the Industry and Inspection Department of the Water Board, Mr. Ts.Sosorbaram, has
said the present water reserves of Ulaanbaatar city are not enough to provide water for the 100,000
Apartments project proposed to be implemented by the Government. New sources should be
identified and new supply lines built. He has also said mining is responsible for 20% of water
pollution in Mongolia, while the world average is 2%.
Source: News.mn
LEADERS SEE MERIT IN HAVING TWO HOUSES OF PARLIAMENT
A debate organized by the MPP on how political parties can work for parliamentary reforms focused
on the merits of having two chambers of Parliament. Apart from MPs from parties represented in
Parliament, leaders of several smaller parties attended the debate. Mr. E.Bat-Uul of the DP said a
15. smaller number of MPs in each chamber would give more opportunity for more intensive discussion
on issues. It would also make proceedings less unwieldy. MPP Secretary-General U.Khurelsukh said
Mongolia has a small population, and two chambers would make Parliament more representative of
the people.
In his closing comments, Prime Minister and Leader of the MPP S.Batbold said that any reform has
to be approved by not just the parties that have seats in Parliament. The views of all political
parties and of society in general will have to be ascertained and compared with the opinion of
scholars and analysts.
Source: Undesnii Shuudan
AMBASSADOR ADDLETON VISITS MONGOLIANS ON AFGHAN AIR BASE
The U.S. Ambassador to Mongolia visited the Afghan Air Force Base in Kabul, March 21, as part of his
tour of Mongolian military operations in Afghanistan. Ambassador Jonathan S. Addleton was
presented a brief detailing the role Mongolian Air Force troops serving in regard to the continuing
development of the AAF. The brief highlighted MAF efforts in instructing Afghan airmen on the
engine and body maintenance of the Mi-17 transport helicopter. Since October 2011, the six-man
Mongolian contingent on the AAF Base in Kabul have been teaching courses focused on the upkeep
of the Mi-17, the centerpiece of the AAF rotary-wing force.
Following the briefing, Mr. Addleton presented the Mongolian team with NATO ISAF service medals
as recognition of their contribution to NATO Training Mission-Afghanistan and NATO Air Training
Command-Afghanistan. ―The main reason I came out here was to show appreciation for the
Mongolian contribution here,‖ said Mr. Addleton, going on to explain how impressed he was with
the level of professionalism and commitment to mission that the Mongolian troops working with
NATC-A and the rest of NTM-A display on a daily basis. Mr. Addleton cited the fact that Mongolian
instructors are able to use Russian, a common historical language shared with Afghans, to
communicate with AAF airmen as a particular example of their industriousness and ability to
succeed in the face of challenges presented by the region.
Read more…
―It was great to have someone come and recognize our work here,‖ said Lt. A. Myagmardorj, the
Mongolian liaison officer with the 440th Air Expeditionary Advisory Squadron and NATC-A. ―The
work we do here is important and it is nice to see people appreciate that fact. It also feels good to
have a sense of home brought to us while we are away,‖ he added, commenting on the Mongolian
cookies, newspapers and other trinkets the ambassador brought with him to Kabul.
Currently, there are approximately 200 Mongolian troops in Afghanistan, though that number is due
to increase in light of a recent agreement between Mongolia and NATO to nearly double the number
of troops serving in the region.
Source: DVIDS
TEAM FINDS OUT WHAT NINJA MINING DOES TO PASTURELAND
Led by the deputy district governor, 18 people from Batshireet district in Khentii province – where
artisanal gold miners, better known as ninjas, have been increasing their activity -- recently visited
Uyanga district in Uvurkhangai province to see for themselves what uncontrolled ninja activity does
to a region. What they found was much worse than what they had expected, thus confirming the
truth of the Mongolian proverb that seeing once is better than hearing a thousand times.
Mocking all local government efforts to deter them, ninjas had dug in Uyanga for almost a decade,
turning pastureland into desert. Extensive grassland -- where once horses raced and where nomad
women milked their cattle, watched by and watching over their children as they played in the
safety of even surface -- is now full of holes and crevices where man or animal can hardly walk a
few paces. Over 1,200 ninjas were active there for a decade, far beyond the capacity of the 5 or 6
policemen put there to regulate their activity. A ninja household could make from MNT200,000 to
MNT1,000,000 a month and that kind of money breeds all types of crimes such as theft, robbery,
prostitution etc.
Most ninjas are undereducated and initially took to this life because there was no other job for
them. Not that life was easy. Digging for gold is hard work, and essential items for survival, such as
water, and wood and coal for heating, are expensive. Since water is hard to come by, cooking is
usually done with dirty water. In early 2001, when ninjas first came to Uyanga and faced opposition
from the authorities, they made it clear they would not leave. They often said, ―Nothing will stop
us digging the earth until the end of our life. If Uyanga gold is finished, we shall move out to other
provinces and carry on.‖ This is just what the team from Batshireet found, wondering what the
future holds for their district.
16. Source: Zuunii Medee
MINISTER URGED TO RECONSIDER VIEWS ON AMENDING CRIMINAL LAW
A group of citizens has written a letter to Mr. Ts.Nyamdorj, Minister of Law and Internal Affairs,
expressing surprise at his summary dismissal of any need to change the Criminal Law. They wonder
how he does not see that ―the nation has become a country of prisoners‖ and how he does not get
to hear widespread popular concern about how the law is ―selectively applied, to protect the well-
connected and the well-heeled‖. They give several examples of how the law, and its enforcing
mechanism, shield those in high positions, while showing no mercy to ―the disadvantaged and the
humble‖.
Source: Zuunii Medee
ANNOUNCEMENTS
NATIONAL HARDWARE SHOW 2011, MAY 10 -12, 2011, LAS VEGAS
The Business Council of Mongolia in collaboration with the US Embassy‘s Commercial Section is now
registering Mongolian business delegations to participate in the ―National Hardware Show 2011 – 9
Shows in 1!‖, to be held at the Las Vegas Convention Center, Las Vegas, USA from May 10 to 12,
2011. It will focus on hardware/tools, homeware, lawn/garden world, paint/accessories,
plumbing/electrical, storage/organization, tailgate products and will feature more than 2,300
exhibitors displaying over 100,000 products.
Please contact 332345 or info@bcmongolia.org for registration and additional information about the
event. Registration deadline is 6:00 PM, March 31, 2011.
___________________________________________
2012-2013 FULBRIGHT STUDENT FELLOWSHIP
The Public Affairs Section of the U.S. Embassy to Mongolia is now accepting applications for the
2012 -2013 Fulbright Student Fellowship Program. Fulbright Student Fellowships are part of a U.S.
Government-funded academic exchange program, and fund graduate-level (M.A., M.S) studies at
U.S. universities. Fulbright Student Fellows are selected by the Public Affairs Section of the U.S.
Embassy. Deadline: April 11, 2011. Visit: http://mongolia.usembassy.gov/fulbright_2012-2013.html
___________________________________________
2012-2013 HUBERT HUMPHREY FELLOWSHIP
This is a one-year, non-degree professional exchange program. It provides approximately a year of
study and related professional experience in the U.S. to mid-career professionals working in the
following public service fields, in either the public or private sector: agricultural
Development/Agricultural Economics, communications/Journalism, Substance Abuse Education,
Treatment and Prevention, Economic Development, Finance and Banking, Educational
Administration, Planning and Policy, Higher Education Administration, HIV/AIDS Policy and
Prevention, Natural Resource and Environmental Policy and Climate Change, Human Resources
Management, Public Health Policy and Management, Public Policy Analysis and Public
Administration, Teaching of English as a Foreign Language, Technology Policy and Management,
Trafficking of Persons, Policy and Prevention, Urban and Regional Planning, Law and Human Rights.
Application deadline: April 15, 2011.
Visit: http://mongolia.usembassy.gov/sholarship_announcements/humphrey2012.html
___________________________________________
“MM TODAY” on MNB-TV, Fridays at 21:15
BCM is pleased to announce that Mongolian National Broadcasting continues its cooperation with
BCM on ―MM Today‖. This English news program is aired every Friday for 10 minutes and is
scheduled for 21:15 tonight. Tune in to watch this program that reports stories from today‘s BCM
NewsWire.
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“BSPOT” on B-TV, Monday to Friday at 21:30
BTV (Business TV) now telecasts a 10-minute English-language news program called BSPOT every
evening from Monday to Friday at 21:30, taking most of the stories from the BCM NewsWire.
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17. NEW POSTINGS ON BCM WEBSITE'S 'PRESENTATIONS' AND 'MONGOLIA REPORTS'
Presentations from BCM‘s monthly meetings on February 28 and January 24, the BCM Environmental
Working Group meeting on February 2 and the Haranga Resources investor‘s meeting sponsored by
MICC on February 23 as well as Mongolia Reports including the U.S. Embassy Mongolia‘s Commercial
Section‘s ―2011 Mongolia Investment Climate Statement‖ are posted on BCM's website
(www.bcmongolia.org) in the "Resource, Presentations" and ―Resource, Mongolia Reports‖ sections
for your review.
We are now posting some news stories and analyses relevant to Mongolia on the BCM website's
‗Mongolian Business News‘ as they come, instead of waiting until Friday to put them all together in
the weekly NewsWire. The NewsWire will, however, continue to be issued on Friday, and will
incorporate items that are already on the home page, so that it presents a consolidated account of
the week‘s events.
ECONOMIC INDICATORS
18. INFLATION
Year 2006 6.0% [source: National Statistical Office of Mongolia (NSOM)]
Year 2007 *15.1% [source: NSOM]
Year 2008 *22.1% [source: NSOM]
Year 2009 *4.2% [source: NSOM]
February 28, 2011 *11.0% [source: NSOM]
*Year-over-year (y-o-y)
CENTRAL BANK POLICY LOAN RATE
December 31, 2008 9.75% [source: IMF]
March 11, 2009 14.00% [source: IMF]
May 12, 2009 12.75% [source: IMF]
June 12, 2009 11.50% [source: IMF]
September 30, 2009 10.00% [source: IMF]
May 12, 2010 11.00% [source: IMF]
CURRENCY RATES – March 17, 2011
Currency Name Currency Rate
US dollar USD 1,212.29
Euro EUR 1,705.39
Japanese yen JPY 14.99
British pound GBP 1,966.03
Hong Kong dollar HKD 155.52
Chinese Yuan CNY 184.73
Russian Ruble RUB 42.65
South Korean won KRW 1.08
Disclaimer: Except for reporting on BCM‘s activities, all information in the BCM NewsWire is
selected from various news sources. Opinions are those of the respective news sources.