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PM Wants Tavan Tolgoi Mines to Remain 100% Owned By Mongolian State PDF Print E-mail
News - Mining and minerals
Monday, 08 February 2010 11:31

BCM Newswire HighlightsPrime Minister S. Batbold has made it clear that he would prefer the Tavan Tolgoi deposit to remain under 100% state ownership, and not be developed as a joint venture like Oyu Tolgoi.

The working group set up by Parliament to prepare the general guidelines for using the mine told him at a meeting earlier in the week that there were two options: foreign investors could be taken as partners with the State owning 51 percent, or the State will keep 100 percent ownership and give the selected investor(s) coal extracting rights under an agreement. He said he had advised the group to work on the second option.

Soil removal work must start this summer if the Parliament directive to begin export from Tavan Tolgoi by 2012 is to be followed. Mr. Batbold has instructed the working group to ready its recommendations before Parliament begins its Spring session. The Government will finish negotiations with investors during the session. The tender will be floated in the summer.
The Minister for Nature, Environment and Tourism told him the group is ready to present the plans for infrastructure, railway and water reserves. The project proposes to establish a power station with an initial capacity of 100 mw, to be gradually raised to 600 mw. The Ministry for Road, Transportation, Construction and City Development is working on choosing between the two possible railway routes: Tavantolgoi-Zuunbayan-Sainshand and Tavantolgoi-Oyutolgoi-Gashuunsukhait. The closest water source is Balgas Ulaan Lake, 65 km from the mine, but the water there can supply only about half the mine’s needs. Other sources will have to be identified.

Minister of Minerals and Energy D. Zorigt said a fresh round of talks with 11 international companies and consortiums will be held this month.  Norwest Corporation, a Canadian consultancy, is working as technical advisor, while JP Morgan and Deutsche Bank have been working as financial advisors. Individual consultants of the World Bank will also offer their services. The preliminary payment demanded will be no less than USD250 million.

Article Source

The source of information was obtained from Mongolian language newspapers Ardiin Erkh and Zuunii Medee and was included in English language in the news highlights of BCM Newswire issue 104.  BCM Newswire is sent once a week and highlights leading articles relating to business, investments, & mines in Mongolia.  BCM Newswire is sent to members of Business Council of Mongolia (BCM) and is made available to public after a month at bcmongolia.org.


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