PM: Political decision will be made to improve Tavantolgoi deposit utilization www.montsame.mn

Ulaanbaatar/MONTSAME/ Prime Minister U.Khurelsukh and government members worked at Tavantolgoi coal mine in Umnugobi aimag and met authorities of ‘Erdenes Tavantolgoi’ JSC, ‘Energy Resource’ LLC and local-owned ‘Tavantolgoi’ Company.

During his working trip, the PM stated the Government would make a political decision on improving utilization of Tavantolgoi deposit very soon and make it considered at the parliament and discuss matters regarding TT railway, auto road and power plant at the Cabinet Meeting.

At the meeting, G.Battsengel, CEO of Energy Resource LLC, proposed to increase border checkpoints, through which coal could be transported. According to him, Energy Resource LLC is extracting in Ukhaa Khudag and Baruun Naran sections of Tavantolgoi deposit. Total production reserve is 509 million tons. The company built the first coal concentrating plant in Umnugobi aimag in 2011 and it is currently capable of concentrating 15 million tons of coal per year. So far, it has concentrated approximately 40 million tons of coal and presently exports its concentrated coal only. In addition, the company constructed and now operates 18MW Power Station.

“It needs to consider accurately if it is riight to have a sole export gateway in the country. Present slow circulation of coal transportation at border checkpoint triggers increased cost of the supply, selling a ton of coal at around USD60. Last year, a sales income rose by 4-fold, reaching USD476 million. The company exported 4.4 million tons of concentrated coal, but utilizes just half of its full industrial capacity. If trucks jam at Gashuunsukhait border checkpoint is resolved and coal transportation resumes running normal, the company is able to double its operation. There are ready buyers, even beyond the border,” said G.Battsengel.

Afterwards, a report on state-owned ‘Erdenes Tavantolgoi (ETT)’ JSC was introduced by its acting director B.Gankhuyag. He highlighted that the company earned MNT80.1 trillion thanks to its active and efficient operations, and now has no external and internal debts. By doing so, the ETT has come into a start of the 1st stage to develop the deposit and implement a strategically important project. Preliminarily, it is possible to raise USD1 billion from investors in the international markets and/or within the project. Thanks to its accomplishments in 2017, a value of the deposit can be reached USD8 billion.

To start the 1st stage of its development, the ETT needs to intensify modernization of facilities and implementation of other projects and introduce advanced international technologies. Due to indispensable needs to concentrate coal, the ETT plans to commence a project of concentration plant and cooperation with Energy Resource LLC and plants abroad to produce concentrate.

A feasibility study was tentatively approved to establish a coal concentration plant with USD330 million and it aims at putting a plant with capacity of concentrating 1-5 million tons of coal into operation in 2018-2020.

Moreover, B.Gankhuyag said, “With its four licenses, the ETT JSC is valued at USD5 billion. Thus, it is entirely possible to raise USD1 billion by making IPO. Two weeks ago, the ETT registered 1072 shares of 2,511,000 shareholders on the balance of the ETT. In this regard, the company schedules to host a meeting of the shareholders on April 27 to modify its rules.”

Following the reports, the Prime Minister and Ministers of Road and Transport Development and Mining and Heavy Industry provided some resolutions and assignments. For instance, Minister of Road and Transport Development J.Bat-Erdene made a decision to stop disorderly issuance of ‘C’ permission of coal transportation to cross the border and issue the permission in case the extractor made a direct contract with a buyer.

Minister of Mining and Heavy Industry D.Sumiyabazar instructed the ETT to execute logistical works itself, recruit skilled personnel and bring Gashuunsukhait auto road project into a direct management of the ETT.

In the end, the PM assigned the authorities of coal companies to pay attention on health, safety and social issues of drivers who transport coal.

M.Unurzul

Mongolia to cooperate with IFC in green building evaluation www.montsame.mn

Ulaanbaatar /MONTSAME/ The Ministry of Construction and Urban Development, Ministry of Environment and Tourism, Energy Regulatory Commission signed a memorandum of cooperation with the International Financial Corporation (IFC) on green building evaluation system implementation in Mongolia on April 13.

Chinese giant recommits to Aspire coal rail plan www.thewest.com.au

Aspire Mining’s ambitious plan for a Mongolian railway line to unlock value in the globally significant Ovoot coking coal deposit in that country has taken another step forward, with the company entering a new memorandum of understanding with its giant Chinese engineering partner.

In an update to the ASX, Aspire said it had signed a new MOU with China Gezhouba Group International Engineering Co (CGGC) as part of an official program of 35 new infrastructure agreements between Mongolia and China.

The program was the centrepiece of the first official visit to China by Mongolia’s recently elected Prime Minister.

Under the new MOU, Aspire and CGGC agree they will continue to work together to finalise a feasibility study on a 550km-long railway running east from Ovoot to the railway hub town of Erdenet.

CGGC, who is 40% owned by the Chinese state, last month delivered a draft feasibility study that found it would be financially viable to construct the railway line. A target date of next month has been set to finalise the study.

Rather fortuitously, Aspire’s railway plan has been caught up in bigger ambitions by China and Mongolia to build a Northern Rail Corridor as part of China’s Belt and Road Initiative to develop trade throughout Eurasia.

This has helped Aspire pick up heavyweight partners such as CGGC on a railway line east from Ovoot and attract interest from Russia in building a line westwards to the Russian border.

Russian rail design group Mosgiprotrans last month signed a deal with Aspire to study the feasibility of running a rail line west from Ovoot to the town of Arts Suuri on the Mongolian-Russian border and then on to the Russian city of Kyzyl.

While the Russian government has yet to declare support for the project, Aspire noted in its latest update that the Russian Ministry for Rail had asked to review the Ovoot to Erdenet proposal.

The company added that the new MOU between Aspire and CGGC recognised that both parties were interested in attracting investment by the Russian and Mongolian governments.

The new MOU also confirmed CGGC’s interest in funding pre-development activities for the project, subject to a guarantee the Trans-Mongolian railway, which runs through Erdenet, will have capacity to take Aspire’s coking coal north to markets in Russia and south to the steel mills of China.

Aspire reiterated that Mongolia’s central rail authority Ulaanbataar JSC had confirmed its forward planning estimates included capacity demand from Northern Railways for production from Ovoot.

As part of the new MOU, Northern Railways has committed to enter into a lump sum turnkey EPC contract with CGGC by the end of November 2018. Aspire reported the EPC contract would be subject to funding for the project, which, if available, could allow construction to begin in the Mongolian spring of 2019.

With China and Mongolia already urging them on and Russia peering over the wall, Aspire has no shortage of potential heavyweight backers for a project that could transform the company into a world-class player in coking coal.

Integrated cashmere supply system required for stable cashmere production www.montsame.mn

Ulaanbaatar /MONTSAME/ Stakeholders of cashmere production propose to create inintegrated system of raw material supply and develop cashmere production at the strategic level. Multi-lateral stakeholders meeting entitled ‘Sustainable Supply Capacity of Cashmere and Cashmere Products: Proper Coordination of Stakeholders’ Collaboration' was co-organized on April 13, by the Ministry of Food, Agriculture and Light Industry, Sustainable Fiber Alliance (SFA) and the Embassy of the United Kingdom in Mongolia.

UN Special Rapporteur evaluates safety of drinking water www.montsame.mn

Ulaanbaatar /MONTSAME/ The United Nations Special Rapporteur on the human rights to safe drinking water and sanitation is working in Mongolia.

German minister to carmakers: Invest in electric cars or lose out www.reuters.com

BERLIN (Reuters) - The German automotive industry must invest heavily in electric car technology and develop battery production facilities in Europe to keep up with global competitors, Economy Minister Peter Altmaier said in a newspaper interview published on Monday.

Mongolia to cultivate over half a million hectares in 2018 www.news.mn

According to the Ministry of Food, Agriculture and Light Industry, a total area of 513.2 thousand hectares are to be cultivated nationally in 2018.

Russian oil producers to make money from China’s yuan-backed crude futures – analysts www.rt.com

Crude oil exports implemented via Eastern Siberia–Pacific Ocean (ESPO) oil pipeline may substantially benefit from yuan-denominated oil futures launched by China last month, according to industry experts.
If the new product manages to succeed, price pegging of the Russian ESPO export blend to the China contract will favorably influence the Russian oil blend price. The new futures contract may reportedly boost Russian producers’ annual revenues by extra $440 million.

Four meat factories to be built with Chinese loan of USD78 million www.montsame.mn

Ulaanbaatar /MONTSAME/ State Secretary of Ministry of Food, Agriculture, Light Industry signed a USD 78 million loan agreement with a Chinese company within the framework of soft loan to be granted from Government of China to Mongolia. The agreement was one of 11 documents of cooperation and mutual understanding between two countries established in scope of the official visit of Prime Minister U.Khurelsukh to China. Under the agreement, four meat factories and quarantine zones will be established in the Gobi, Khangai, Western and Eastern regions of Mongolia.

New MoU signed on Erdenet to Ovoot railway project www.news.mn

Aspire Mining Ltd has entered into a new memorandum of understanding (MoU) with China Gezhouba Group International Engineering Co Ltd (CGGC). The new MoU was signed during Mongolian Prime Minister U.Khurelsuk’s official visit to China.