New Mongolian government announces seizure of Tavan Tolgoi coal site

The new government of Mongolia
has decided to seize ownership of the mammoth Tavan Tolgoi coal mine. 

During his inaugural speech
before Parliament, newly sworn-in Prime Minister Sanj Bayar's made clear
his intentions saying, “Tavan Tolgoi has become an issue of national
security and public interests.”  

Six energy giants had been
bidding for the rights to mine Tavan Tolgoi. Furthermore, BHP Billiton
Ltd., Peabody Energy Corp. and China Shenhua Energy Co. had begun discussions
with the former government about receiving the rights to the site. 

Tavan Tolgoi is estimated to
contain 1.5 billion metric tons of coking coal and 3.6 billion tons
of thermal coal which can produce as much as 30 million tons a year
for at least 30 years. 

The previous government was
criticized within and outside of government circles for not guaranteeing
Mongolia would sufficiently profit from mining activities. 

While the new government has
not hidden its goal of taking over the Tavan Tolgoi site, it will now
have to convince foreign investors that Mongolia will not nationalize
future mining development.

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Archived Comments
old friend
2007-12-19 05:44:15
This is a strange story. The government is \\\"seizing\\\" the mine from whom, exactly? You mention that all those foreign mining companies were discussing receiving the rights to the site \\\"from the government\\\", so surely this was the government\\\'s already? How can they nationalize something that is alread theirs?
old friend
2007-12-19 05:47:44
This is a strange story. The government is \\\"seizing\\\" the mine from whom, exactly? You mention that all those foreign mining companies were discussing receiving the rights to the site \\\"from the government\\\", so surely this was the government\\\'s already? How can they nationalize something that is alread theirs?
bburns
2007-12-19 23:25:26
The Mongolia government must realize that they do not have the capital nor technology to undertake such an investment as developing these coal fields. They would be so much better off to let the experts do the project right, spend the capital, and let the people of Mongolia reap the long term benefits of a strong economy through taxes and employment; not just line the pockets of a few politicians while letting the citizens suffer the fate of a third world country.
old friend
2007-12-20 02:19:04
bburns, so Mongolia should just be another Congo?