1 PRIME MINISTER OYUN-ERDENE VISITS EGIIN GOL HYDROPOWER PLANT PROJECT SITE WWW.MONTSAME.MN PUBLISHED:2025/04/30      2 ‘I FELT CAUGHT BETWEEN CULTURES’: MONGOLIAN MUSICIAN ENJI ON HER BEGUILING, BORDER-CROSSING MUSIC WWW.THEGUARDIAN.COM PUBLISHED:2025/04/30      3 POWER OF SIBERIA 2: ECONOMIC OPPORTUNITY OR GEOPOLITICAL RISK FOR MONGOLIA? WWW.THEDIPLOMAT.COM PUBLISHED:2025/04/29      4 UNITED AIRLINES TO LAUNCH FLIGHTS TO MONGOLIA IN MAY WWW.MONTSAME.MN PUBLISHED:2025/04/29      5 SIGNATURE OF OIL SALES AGREEMENT FOR BLOCK XX PRODUCTION WWW.RESEARCH-TREE.COM  PUBLISHED:2025/04/29      6 MONGOLIA ISSUES E-VISAS TO 11,575 FOREIGNERS IN Q1 WWW.XINHUANET.COM PUBLISHED:2025/04/29      7 KOREA AN IDEAL PARTNER TO HELP MONGOLIA GROW, SEOUL'S ENVOY SAYS WWW.KOREAJOONGANGDAILY.JOINS.COM  PUBLISHED:2025/04/29      8 MONGOLIA TO HOST THE 30TH ANNUAL GENERAL MEETING OF ASIA SECURITIES FORUM WWW.MONTSAME.MN PUBLISHED:2025/04/29      9 BAGAKHANGAI-KHUSHIG VALLEY RAILWAY PROJECT LAUNCHES WWW.UBPOST.MN PUBLISHED:2025/04/29      10 THE MONGOLIAN BUSINESS ENVIRONMENT AND FDI: CHALLENGES AND OPPORTUNITY WWW.MELVILLEDALAI.COM  PUBLISHED:2025/04/28      849 ТЭРБУМЫН ӨРТӨГТЭЙ "ГАШУУНСУХАЙТ-ГАНЦМОД" БООМТЫН ТЭЗҮ-Д ТУРШЛАГАГҮЙ, МОНГОЛ 2 КОМПАНИ ҮНИЙН САНАЛ ИРҮҮЛЭВ WWW.EGUUR.MN НИЙТЭЛСЭН:2025/04/30     ХУУЛЬ БУСААР АШИГЛАЖ БАЙСАН "БОГД УУЛ" СУВИЛЛЫГ НИЙСЛЭЛ ӨМЧЛӨЛДӨӨ БУЦААВ WWW.NEWS.MN НИЙТЭЛСЭН:2025/04/30     МЕТРО БАРИХ ТӨСЛИЙГ ГҮЙЦЭТГЭХЭЭР САНАЛАА ӨГСӨН МОНГОЛЫН ГУРВАН КОМПАНИ WWW.EAGLE.MN НИЙТЭЛСЭН:2025/04/30     "UPC RENEWABLES" КОМПАНИТАЙ ХАМТРАН 2400 МВТ-ЫН ХҮЧИН ЧАДАЛТАЙ САЛХИН ЦАХИЛГААН СТАНЦ БАРИХААР БОЛОВ WWW.EAGLE.MN НИЙТЭЛСЭН:2025/04/30     ОРОСЫН МОНГОЛ УЛС ДАХЬ ТОМООХОН ТӨСЛҮҮД ДЭЭР “ГАР БАРИХ” СОНИРХОЛ БА АМБИЦ WWW.EGUUR.MN НИЙТЭЛСЭН:2025/04/30     МОНГОЛ, АНУ-ЫН ХООРОНД ТАВДУГААР САРЫН 1-НЭЭС НИСЛЭГ ҮЙЛДЭНЭ WWW.MONTSAME.MN НИЙТЭЛСЭН:2025/04/29     ЕРӨНХИЙ САЙД Л.ОЮУН-ЭРДЭНЭ ЭГИЙН ГОЛЫН УЦС-ЫН ТӨСЛИЙН ТАЛБАЙД АЖИЛЛАЖ БАЙНА WWW.MONTSAME.MN НИЙТЭЛСЭН:2025/04/29     Ц.ТОД-ЭРДЭНЭ: БИЧИГТ БООМТЫН ЕРӨНХИЙ ТӨЛӨВЛӨГӨӨ БАТЛАГДВАЛ БУСАД БҮТЭЭН БАЙГУУЛАЛТЫН АЖЛУУД ЭХЛЭХ БОЛОМЖ БҮРДЭНЭ WWW.MONTSAME.MN НИЙТЭЛСЭН:2025/04/29     MCS-ИЙН ХОЁР ДАХЬ “УХАА ХУДАГ”: БНХАУ, АВСТРАЛИТАЙ ХАМТРАН ЭЗЭМШДЭГ БАРУУН НАРАНГИЙН ХАЙГУУЛЫГ УЛСЫН ТӨСВӨӨР ХИЙЖЭЭ WWW.EGUUR.MN НИЙТЭЛСЭН:2025/04/29     АМ.ДОЛЛАРЫН ХАНШ ТОГТВОРЖИЖ 3595 ТӨГРӨГ БАЙНА WWW.EGUUR.MN НИЙТЭЛСЭН:2025/04/29    

Events

Name organizer Where
MBCC “Doing Business with Mongolia seminar and Christmas Receptiom” Dec 10. 2024 London UK MBCCI London UK Goodman LLC

NEWS

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Pope Francis in Mongolia: For the Church the priority is not numbers www.vaticannews.va

Pope Francis is about to leave for Mongolia, a visit he has “longed for,” and one that was already contemplated in the unrealized plans of St. John Paul II, after missionaries revived a Christian community in the early 1990s. The Church that will receive the embrace of the Successor of Peter in the heart of Asia is a Church “small in numbers, but lively in faith and great in charity.” Pope Francis will meet not only the country’s 1,500 Catholics, but all the “noble” and “wise” Mongolian people with their great Buddhist tradition.
Why is the pope going to Mongolia? Why is he devoting five days of his schedule (two days of travel plus three days on the ground) to visiting such a small group of Catholics? Is “geopolitics” involved since it is a trip to a country that borders the Russian Federation and the People's Republic of China? In fact, the motivation for the pilgrimage to the peripheries of Asia has no “geopolitical” implications and is certainly not the defining trait of Jorge Mario Bergoglio's pontificate.
On Monday, 30 November 1970, Pope St Paul VI made a long journey, reaching as far as the Samoan Islands in the Pacific Ocean. During the celebration of Mass in the village of Leulumoega Tuai, on the northwestern coast of the island of Upolu, he set aside the majestic “we” then used by pontiffs and said, “It is not a desire for travel nor any self-interest whatever that has drawn me to you. I come because we are all brothers and sisters; or, to put it another way, you are my sons and daughters and it is fitting that I, as father of the family that is the Catholic Church, should show each one that he has a right to equal affection. Do you know the meaning of ‘Catholic Church’? It means that the Church is for the entire world, that she is for all, that nowhere is she an alien. Each human being, whatever his or her country, race, age, or education has a place in the Church.”
The Church: a place for everyone. The Church, where the priority is not numbers and where no one is a foreigner, whatever language, culture, people, or nation they belong to. It is the Church “para todos” - for all - that Pope Francis spoke about in Lisbon. Less than a month after WYD, the Bishop of Rome is back on the road, telling his “brothers and sisters in Mongolia” that he is “happy to travel to be among you as a brother of all.”
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Pope to fly across world to visit Mongolia's tiny Catholic flock www.reuters.com

Mongolia's Catholics - all 1,450 of them - could be squeezed standing into St. Peter's Basilica dozens of times over and their number is smaller than the congregation of a small parish in some small towns.
So why is Pope Francis, 86 and in need of a wheelchair, travelling 8,278 km (5,143 miles) to visit them this week?
Essentially, to paraphrase British climber George Mallory's response in the 1920s as to why he wanted to climb Mt. Everest, because the Catholics are there.
"I can't even fathom this," said Arvanai Hashdorj, 19, a university student who attended Mass on Sunday at the Cathedral of Saints Peter and Paul in the Mongolian capital Ulaanbaatar on Sunday. "So I am very grateful".
Hashdorj told Reuters he had recently returned from the Catholic Church's World Youth Day gathering in Lisbon, where young people from countries with millions of Catholics noted in conversations with him that the pope had not yet visited their countries.
Visiting places where Catholics are a minority is part of Francis' policy of drawing attention to people and problems in what he has called the peripheries of society and of the world.
He still has not visited most of the capitals of Western Europe.
Francis, who will be attending an inter-religious service in Mongolia, said at his weekly noon address on Sunday that he would be visiting "a Church that is small in numbers but vivacious in faith".
Last year, Francis named Archbishop Giorgio Marengo, an Italian, the first cardinal to be based in Mongolia, where he is the Catholic Church's administrator.
"The originality of this trip is related to the originality of the country sparsely populated and with such a small Catholic community," Marengo said last month in Rome.
"This shows how for him (the pope), every single member of the faithful is important," said Marengo, who has been a missionary in Mongolia for more than 20 years.
Mongolia has nine parishes, compared to 25,500 in Italy. The smallest one, hundreds of miles from the capital, has only between 30-40 members.
Still, the visit will show how far it has come since locals watched "these funny foreigners praying," Marengo said.
'GREAT RELIGIOUS TRADITION'
Francis said on Sunday that he felt honoured to visit "a noble and wise people" with a "great religious tradition".
About 60% of Mongolians identify as religious. Among those, 87.1% are Buddhist, 5.4% Muslim, 4.2% Shamanist, 2.2% Christian and 1.1% followers of other religions, according to the U.S. State Department.
There are only two native Mongolian Catholic priests.
"I wanted to show the world that there is a Catholic Church (in Mongolia) and it's beautiful," said one of them, Father Peter Sanjaajav, after saying Mass at the Cathedral the pope will visit on Saturday as part of the Aug. 31-Sept 4 trip.
The country of about 3.3 million people is strategically significant for the Roman Catholic Church because of its proximity to China, where the Vatican is trying to improve the situation of Catholics amid sometimes scratchy relations with the communist government.
Mongolia was part of China until 1921 and still has close ties with Beijing. Diplomats say it could be used as an intermediary with China.
It was not clear if any Catholics from China would be allowed to cross the border to see the pope.
China is by far Mongolia's biggest export market, buying most of its coal, copper and cashmere, and Ulaanbaatar also relies on China's rail network to deliver its goods to third countries.
Mongolia has seen a revival of Tibetan Buddhism since the collapse of the Soviet-backed Communist government in 1990, and the Dalai Lama is regarded as its main spiritual leader.
However, China has repeatedly put pressure on Mongolia not to allow the 88-year old exiled Tibetan leader to visit, branding him a dangerous separatist.
Additional reporting by David Stanway in Singapore; Editing by Raju Gopalakrishnan
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The Hidden Cause Behind Mongolia’s Deadly Summer Floods www.thediplomat.com

Mongolia recently experienced torrential rain and flash flooding, which resulted in a devastating impact on its decades-old infrastructures. Thousands of homes were destroyed, tens of thousands of people were displaced and several were killed. Despite the quick response and relentless efforts of the National Emergency Management Agency (NEMA), the flooding highlighted Ulaanbaatar’s serious need to ameliorate its urban planning.
Between July 3 and August 5, Ulaanbaatar experienced intermittent heavy rain and flash floods, resulting in four deaths, including a 10-month-old baby. An estimated 31,600 families (some 128,000 people) were directly affected by the flooding. The International Federation of Red Cross based in Ulaanbaatar counted some 20,000 people displaced, and many are struggling to rebuild their lives.
According to OCHA, the U.N. arm responsible for humanitarian assistance and disaster relief, “over 100 residential buildings and hundreds of traditional yurts and vehicles” flooded in Ulaanbaatar in July.
The international community is helping provide assistance. The Australian Embassy to Mongolia, the Red Cross, UNESCO, the EU’s Emergency Response Coordination Center, major businesses, and others have donated to Mongolia’s relief efforts.
Australian Ambassador to Mongolia Katie Smith pledged, “As a steadfast friend and committed third neighbor, Australia will be providing AUD 250,000 in humanitarian assistance to Mongolia through the Mongolian Red Cross Society and UNFPA Mongolia to support the flood relief efforts.” The EU is to allocate 50,000 euros in assistance to the severely hit localities, which can help 11,000 people.
As residents and businesses recover from damages, Mongolian youths set up a candlelight vigil in remembrance of the individuals who passed away during the flooding. The mayor’s office donated apartments to the families of the deceased and provided 16 furnished apartments to families left homeless.
Many residents blamed the scale of the disaster on the Mongolia capital’s poor urban planning, as well as mismanagement of funds that should have been used to fix eroded roads, bridges, and flood zones. Ulaanbaatar residents, particularly in Bayanzurkh and Sukhbaatar districts, are demanding an overhaul of city’s urban planning.
As Ulaanbaatar’s population density continues to spiral – today, one-third of Mongolia’s total population lives in the capital – the old infrastructure systems simply cannot handle day-to-day use, let alone acute disasters such as floods.
A lack of effective urban planning contributes to Ulaanbaatar’s woes, whether flood management or air pollution. This is especially true in the low-income areas and communities in ger districts, which suffer from unfinished pavements, lack of street lighting, and lack of sewage systems.
Communities living in ger districts experience the worst of Ulaanbaatar’s air pollution and lack access to clean water. This leaves them vulnerable to diseases such as tuberculosis. The International Union Against Tuberculosis and Lung Disease categorizes Mongolia as a “high-burden” country for tuberculosis, estimating the disease impacts “428 per 100,000 people.” Concerningly, an unusually high percentage of new cases are found in children – 11 percent in Mongolia, versus just 3 percent in the Western Pacific region as a whole.
Sanitation is also a major issue that urban planners and policymakers need to pay attention to. Lack of access to clean water and sewage hook-ups also contribute to disease.
Grassroots efforts are underway to spark change. Oyungerel Tsedendamba, a former parliamentarian and minister of culture, is active in promoting sanitation awareness and solutions to the decades-old problem. Organizations such as Clean Sanitation and Water for All are watchdogs for Mongolia’s sanitation and hygiene. In 2020, the organization estimated that for Mongolia to ensure 100 percent safely managed sanitation by 2030 – in both urban and rural areas – efforts need to be four times faster.
Ulaanbaatar is hit by a two-fold problem. First, there is the failure to repair existing infrastructure; second, there is a failure to provide infrastructure for new residents. This is especially problematic as Ulaanbaatar is expanding into areas that are prone to flooding.
Policy failures exacerbated the recent floods, and were also clearly visible in the government response. City workers disinfected the flood-affected streets, a necessary step to stem the spread of water-borne diseases, but claimed they were not responsible for disinfecting residential buildings and homes. As the city’s policymakers, the mayor’s office should provide both opportunities and tools for residents to disinfect. This also means that government funds need to be allocated towards flood relief tools, medical equipment, and disinfectants. Foreign governments and nonprofits are not responsible, nor are they required to assist, but thankfully they do.
Eight years ago, in 2015, Artessa Saldivar-Sali, a resilience engineering specialist at the World Bank, warned to the risk of devastating flood in Ulaanbaatar. She noted that more and more families were setting up homes on “hazardous mountain slopes and flood plains,” while the city’s drainage systems were not fit for purpose. Those trends have only continued in the past eight years.
As of 2015, “[m]ore than 200,000 people, 600 residential buildings, 31,000 gers (traditional portable dwellings used by nomads) and 109 schools, kindergartens, and medical units are located in medium to high flood hazard areas,” Saldivar-Sali wrote.
She added the flooding also risked damaging “critical infrastructures such as the high-voltage power station that sits in the middle of the Selbe river channel.” Unfortunately, the recent flood did damage the Selbe Dam. The collapse of the dam increased the flooding in Ulaanbaatar, impacting five central districts and flooding residential buildings. Social media posts illustrated the major frustration of foreigners living in central Ulaanbaatar.
Just after the flooding, on August 21, Mongolia hosted the Seventh Meeting of the Asia-Pacific Parliamentary Forum on Global Health, which consisted of representatives from around the Asia-Pacific region and the World Health Organization.
During the forum, the speaker of Mongolia’s parliament, Zandanshatar Gombojav, said that Mongolia was pursuing “health sector reforms, increasing the financing of care and services, reflecting health in policies of all sectors, and strengthening inter-sectoral collaboration as its’ core goal.” The forum discussed post-COVID relief and health, but did not devote enough attention to other critical subjects such as disaster preparedness, sanitation, and urban planning.
Moving forward, Ulaanbaatar cannot neglect the seriousness of its infrastructure mismanagement and poor urban planning, and the knock-on effects on public health. Currently, the government is making piecemeal attempts to shift things around, such as moving universities to different locations. However, the main issue lies in the need to modernize Ulaanbaatar’s infrastructure and prevent settlers from moving into flood-prone or otherwise hazardous locations.
BY Bolor Lkhaajav
Bolor Lkhaajav is a researcher specializing in Mongolia, China, Russia, Japan, East Asia, and the Americas. She holds an M.A. in Asia-Pacific Studies from the University of San Francisco.
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Renewable Energy Solutions for Heating Systems in Mongolia: Developing a strategic heating plan www.irena.org

Mongolia’s heating system is based on domestically produced coal, which provides an economical option for the supply of heating for the population. However, coal heating has resulted in high local pollution in cities, causing respiratory-related health issues.also It also hinders Mongolia’s aim to reduce greenhouse gas emissions and meet their Nationally Determined Contribution (NDC) to the Paris Agreement.
Mongolia, however, has significant potential for renewable energy sources – especially wind, solar and geothermal – which could be used to meets its heating needs. This detailed renewable energy-based strategic heating plan leverages the existing district heating network in the utilisation of locally available renewable heat sources as well as renewable electricity.
The assessment comprises a detailed mapping of the heat demand of buildings and an energy system analysis of district heat supply. Energy efficiency improvement in existing and new buildings, efficient and modern heat supply networks, and the integration of renewable heat and electricity play key roles in the proposed plan, which demonstrates that a renewable energy-based heating supply is more technologically and socio-economically feasible than the current fossil-fuel based system.
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Construction Works of Solongo Affordable Housing Projects Launched www.montsame.mn

The Ministry of Construction and Urban Development, and the Kolon Global Corporation LLC of the Republic of Korea signed a Contract on the Construction Works of Solongo Affordable Housing Complex 1 and Complex 2 Projects in Mongolia yesterday.
The Contract was signed by the State Secretary of the Ministry of Construction and Urban Development G. Magnaisuren and the Vice-President of the Kolon Global Corporation LLC Jo Hyun Chul. The construction of 5,002 flats on an area of 17.5 hectares in the territory of the 21st District of Ulaanbaatar, east of the Buyant-Ukhaa Airport, will commence upon signing of the Conract with a soft loan from the Government of South Korea.
The construction of the housing complexes will be financed by a 40-year term soft loan of USD 266.9 million with an annual interest rate of 0.15 percent from the Economic Development Cooperation Fund (EDCF) of South Korea's Eximbank and completed within 40 months.
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Preparing Mongolian Rescue Team for Earthquake Response www.montsame.mn

The Australian Government and the International Search and Rescue Advisory Group (INSARAG) jointly organized the Asia Pacific Earthquake Response Exercise (APERE) in Brisbane, the capital of Queensland, on August 21-25, 2023.
The Mongolian rescue team, led by Brigadier General B. Uuganbayar, Deputy Director of the National Emergency Management Agency of Mongolia, participated in the biggest earthquake response exercise in the region, testing their preparedness to overcome a catastrophic earthquake.
The exercise created a mock scenario in which a severe earthquake caused significant loss of life and collapsed buildings. It involved over 300 emergency management personnel from more than 30 countries in the Asia Pacific region.
The rescue team, alongside their frontline partners from Australia and other countries, responded to the exercise as if it was the “real deal” and exchanged knowledge and best practices for dealing with natural disasters.
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UK Ambassador Presents Letter of Credence www.montsame.mn

Ambassador Extraordinary and Plenipotentiary of the United Kingdom of Great Britain and Northern Ireland to Mongolia Fiona Blyth presented her Letter of Credence to the President of Mongolia Khurelsukh Ukhnaa on August 28, 2023. Mr. President congratulated the Ambassador on officially assuming her duty and wished her success.
Noting that this year marks the 60th anniversary of the diplomatic relations between Mongolia and the United Kingdom, President Khurelsukh Ukhnaa stressed the importance of strengthening relations and cooperation between the two countries and facilitating high-level visits.
The newly appointed Ambassador Fiona Blyth expressed her readiness to actively work towards expanding relations and cooperation between the two countries.
Ms. Fiona Blythe has served as Principal Analyst in the UK Cabinet Office, Team Leader in the National Security Secretariat, Senior Policy Advisor in the United Kingdom Mission to the United Nations in New York, and Senior Political Affairs Officer in the United Nations Assistance Mission in Somalia.
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Australia to provide AU$250,000 in humanitarian aid to Mongolia www.akipress.com

Australia will provide AU$250,000 in humanitarian aid following the adverse humanitarian situation caused by severe floods in Mongolia.
Australia will send assistance through the Mongolian Red Cross Society and the United Nations Population Fund (UNFPA) Mongolia, which support those affected.
"Our thoughts are with people who have lost loved ones, homes and livelihoods as a result of the floods. Australia and Mongolia have a history of helping each other through difficult times. As a third neighbor and true friend, Australia is committed to supporting Mongolia's response," said Australian Ambassador to Mongolia Katie Smith.
The Mongolian Red Cross Society will continue distributing food and non-food items to displaced families, supporting the Emergency Committee and other authorities with damage and impact assessments, and providing psychosocial support and referral services. UNFPA will provide clothing kits that contain essential items to help women and girls maintain proper hygiene after displacement.
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Fitch Places Mongolian Mining on Watch Negative; Rates Proposed Exchange and New Notes 'B(EXP)' www.fitchratings.com

Fitch Ratings - Hong Kong/Tokyo - 28 Aug 2023: Fitch Ratings has placed Mongolian Mining Corporation's (MMC) 'B' Long-Term Foreign-Currency Issuer Default Rating (IDR) and the rating on its US-dollar bond due April 2024 on Rating Watch Negative (RWN). At the same time, Fitch has assigned a 'B(EXP)' expected rating to MMC's proposed US-dollar senior exchange notes and new issuance with a Recovery Rating of 'RR4'. The final rating is contingent upon the receipt of final documents conforming to information already received.
The proposed notes will mature on the third anniversary of the exchange settlement date and will be jointly and severally issued by MMC and its wholly owned subsidiary, Energy Resources LLC.
We do not consider the proposed debt exchange transaction as default avoidance, despite the maturity extension for MMC's existing USD350 million senior secured notes due April 2024, as we believe MMC is able to accumulate sufficient cash to repay the notes, even without the proposed issuance.
The RWN takes into consideration the low cash buffer that will be available after the repayment of the notes due 2024, should the exchange offer fail, to manage variances in the operating environment. The inherent volatility and lack of predictability of the post repayment cash position is more consistent with a rating level that is one notch lower. We will remove the RWN and affirm the rating with a Stable Outlook if the exchange is completed at the terms communicated.
KEY RATING DRIVERS
Exchange to Address Refinancing Risk: The exchange offer is at par value, using a combination of cash and new notes, subject to a minimum acceptance of 75% of outstanding principal. A successful transaction would reduce the funding requirements for MMC's 2024 notes and would be credit positive, as it would improve the company's maturity profile.
Sufficient Cash for Repayment: If the proposed exchange fails, we expect that MMC would have the capacity to repay its 2024 notes with cash generated from operations, taking into consideration our forecast of a lower average selling price (ASP) in 2H23 and 1Q24. The outstanding balance of MMC's 2024 notes was USD350 million at mid-August 2023. The company had a cash balance of over USD200 million at end-June 2023, up from USD65 million at end-2022.
We expect MMC could generate over USD250 million in EBITDA between June 2023 to 1Q24, which, after taking into consideration other cash flow uses, such as interest, taxes and capex, together with the USD50 million in an unused committed facility, would leave the company with sufficient cash for the bond repayment and continued operation.
Limited Cash Buffer Post Repayment: We expect MMC to have over USD350 million of cash available as of end 1Q24 without the exchange offer, with an additional USD50 million in an unutilised committed facility. We calculate that the company will have a cash buffer of around USD50 million after the USD350 million principal repayment after subtracting the minimum USD50 million of cash required to maintain its operation. However, the inherent variances of MMC's operating environment can result in the buffer varying widely, which is commensurate with a one-notch lower rating.
Robust Operational Improvements: MMC's coking-coal operation has normalised, with Covid-19 pandemic-related disruption at the border with China having eased in 1Q23. Average daily throughput rose to about 800 trucks in 1H23, surpassing pre-pandemic and the 1H22 level of around 240 trucks. MMC ramped up processing volume to 6.8 million tonnes in 1H23, from 0.9 million tonnes in 1H22, ahead of our expectations. Meanwhile, the realised ASP for hard coking coal exceeded USD160/tonne, from a 2022 average of USD147/tonne.
We expect the ASP to fall in 2H23, but for average ASP in 2023 to remain above 2022 levels. We also expect washed hard coking coal sales volume to reach 5.5 million tonnes, against our previous forecast of 5.0 million tonnes (2022: 3.5 million tonnes). As a result, the EBITDA margin should improve to over 40%, from around 24% in 2022, with greater free cash flow from the higher volume, stronger pricing assumptions and lower costs. We also forecast net leverage to drop to below 1.0x (2022: 3.0x), supported by a strong ASP and margin expansion.
Small Scale, Single Product: MMC is small by revenue compared with Fitch-rated coal miners globally. Washed hard coking coal accounted for over 95% of its total revenue in 2022. Its latest coal reserve statements show total marketable coal reserves of just under 400 million tonnes, or a reserve life of around 35 years. MMC's small scale and product concentration constrain its business profile to the 'b' category. MMC is looking to diversify away from coking coal, but we believe it will remain its dominant revenue contributor in the short to medium term.
Regional Cost Advantage: MMC's cash costs, including royalties, are in the second quartile of the global coking-coal cost curve, but its cost advantage is only in the northern part of China due to the proximity of its mines to steel mills in the area. Land transportation costs to Chinese customers averaged at about USD13/tonne in 1H23, limiting MMC's cost competitiveness and putting it in the higher quartile of the global cost curve. Delivery beyond northern China would raise costs, limiting its customer-base to mainly northern China.
DERIVATION SUMMARY
The RWN reflects the narrow buffer provided by MMC's Fitch-estimated cash balance after the principal repayment on the 2024 notes, which may not protect MMC from volatile market conditions should the exchange offer not proceed. MMC has a smaller revenue scale compared with rated peers, such as Guangyang Antai Holdings Limited (B/Stable), PT Indika Energy Tbk (BB-/Stable) and PT Golden Energy Mines Tbk (GEMS, BB-/Stable).
Guangyang Antai's revenue is more than 10x times that of MMC, while Indika's revenue scale is more than 7x larger and GEMS' 5x. However, MMC margin is much higher than that of Guangyang Antai and similar to that of Indika and GEM. MMC is a single-product coal miner, similar to the peers. Its operational profile in terms of mine life is similar to that of GEMS, whose mine life is over 25 years. Indika's mine life is shorter, at around 15 years.
MMC's leverage and financial flexibility profile is weaker than that of GEMS. GEMS has more stable free cash flow generation ability, much lower leverage and well-distributed amortising debt. Both MMC and Indika have had choppy free cash flow generation in the past few years and concentrated debt maturities. Nevertheless, Indika has better interest coverage and much lower leverage. We expect lower leverage at MMC compared with Guangyang Antai, but both companies have had weak FCF generation in the past few years.
KEY ASSUMPTIONS
Fitch's Key Assumptions within our Rating Case for the Issuer:
- No exchange offer is considered
- Hard coking coal ASP of USD150/tonne in 2023 and over USD140/tonne in 2024, consistent with Fitch's price deck assumptions
- Total sales volume over 8.5 million tonnes in 2023, dropping to just under 7.0 million tonnes from 2024
- EBITDA margin to average at slightly below 40% in 2023-2025, supported by higher volume, a strong ASP and normalised costs
- Capex at average at around 10% of revenue in 2023-2025
- No dividend payments in 2023-2025
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive rating action/upgrade:
- We will remove the RWN and affirm the ratings with a Stable Outlook upon completion of the exchange offer at the terms communicated.
Factors that could, individually or collectively, lead to negative rating action/downgrade:
- Failure to complete the exchange offer or secure other means of funding to reduce refinancing risk by end-3Q23
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. For more information about the methodology used to determine sector-specific best- and worst-case scenario credit ratings, visit https://www.fitchratings.com/site/re/10111579.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: MMC had USD208 million of cash on hand and USD50 million in unutilised credit facilities at end June 2023. However, this is insufficient to repay the notes due in April 2024, which had a face value of USD350 million in mid-August 2023. Nevertheless, we expect that the company will be able to accumulate additional cash in 2H23 and 1Q24 to meet the principal repayment and retain a cash buffer to sustain its operation.
ISSUER PROFILE
MMC is the largest producer and exporter of high-quality hard coking coal in Mongolia. It owns and operates the Ukhaa Khudag and Baruun Naran open-pit coking coal mines in South Gobi province. MMC processed 6.6 million tonnes of run-of-mine coal in 2022, which yielded around 3.0 million tonnes of washed coking coal as a primary product and 1.2 million tonnes of washed thermal coal as a secondary product.
REFERENCES FOR SUBSTANTIALLY MATERIAL SOURCE CITED AS KEY DRIVER OF RATING
The principal sources of information used in the analysis are described in the Applicable Criteria.
ESG CONSIDERATIONS
The highest level of ESG credit relevance is a score of '3', unless otherwise disclosed in this section. A score of '3' means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. Fitch's ESG Relevance Scores are not inputs in the rating process; they are an observation on the relevance and materiality of ESG factors in the rating decision. For more information on Fitch's ESG Relevance Scores, visit http://www.fitchratings.com/topics/esg/products...
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Pope Francis: I am happy to visit Mongolia as a brother to all www.vaticannews.va

In his greetings following the recitation of the Angelus prayer on Sunday, Pope Francis spoke about his upcoming Apostolic Journey to Mongolia, which will take place from 31 August to 4 September.
The motto of the journey, "Hoping Together," aims to underscore the double meaning of the Holy Father's Apostolic Journey to Mongolia: that of a pastoral visit and of a state visit.
The Pope described it as a "much-desired visit" and an opportunity "to embrace a Church small in numbers but vibrant in faith and great in charity."
The Holy Father recalled Mongolia's rich "religious tradition," which he "will have the honor of getting to know especially in the context of an interreligious event."
"A brother to all"
Pope Francis expressed his happiness "to be among" the Mongolian people "as a brother for all."
The Pope concluded by thanking the civil authorities of Mongolia for the invitation and those "who with great commitment are preparing for my arrival."
"I ask all of you to accompany this visit with your prayers," he said.
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