Minister of Foreign Affairs B. Battsetseg today received Chief Executive Officer of Oyu Tolgoi LLC Ms. Deirdré Lingenfelder.

The Minister emphasized that the successful implementation of the Oyu Tolgoi project not only increases the country’s budget revenues and the income of national suppliers but also makes invaluable investments in young Mongolians by teaching them advanced mining technologies and Western business methods. Foreign Minister Battsetseg confirmed that the Ministry of Foreign Affairs of Mongolia would provide all necessary support to the Oyu Tolgoi project.

Ms. Deirdre Lingenfelder briefed the Minister on current developments in the Oyu Tolgoi project, stressing that the project’s mining and financing activities are proceeding according to plan with a focus on achieving sustainable production of quality copper concentrate. Mrs. Deidre Lingenfelder also invited Foreign Minister B. Battsetseg to visit the Oyu Tolgoi mine site.

Ministry of Foreign Affairs

Newly appointed US Ambassador Richard Buangan is taking Mongolian language classes. “Started my Mongolian language lessons this week, starting with all the letters of the alphabet,” the Ambassador wrote in Twitter.

Based on his State Department profile, Buangan joined the US Department of State in 1999 and was assigned to Israel, China, France and the Ivory Coast. He also served as an executive assistant to then Secretary of State Mike Pompeo and more recently as the acting assistant secretary to the Bureau of Global Public Affairs from April 4 to June 30.

Born to a Filipino family in San Diego, California, he graduated with a Bachelor of Arts in Political Science and Economics from St. Edward’s University in Austin, Texas, and speaks four languages fluently.

Representatives of the Ministry of Mining and Heavy Industry of Mongolia, and the members of the School of Mechanical Engineering of Mongolian University of Science and Technology, and Japanese scholar and businessman Dr. Masao Tokita visited Steppe Metal Powder LLC and exchanged ideas with the plant staff.

During the visit to the plant, Dr. Masao Tokita, the Chairman of the Board of Directors of NJS Co.,LTD, mentioned that he was pleased that copper and copper alloy powder production commenced in Mongolia, and advised on the many possibilities and technological solutions of using metal powders to produce parts needed for the production of automobiles, aerospace, and industrial equipment. Dr. Masao Tokita specifically mentioned that even though Mongolia is decades behind in industrialization compared to developed Western countries, it could compete on an equal footing with industrialized countries in the world market by using modern 3D printers, “spark plasma sintering” and “metal-injection molding” technologies. The guests noted that the partnership between business, government and academic institutions is very important, and the parties need to work out a plan.

NJS Co.,LTD installed spark plasma sintering equipment at the School of Mechanical Engineering of Mongolian University of Science and Technology as part of the Japan-Mongolia MJEED

At this year's 44th World Chess Olympiad, Mongolia shook up the world when the Mongolian women’s team defeated the seventh-ranked Americans. Overall, the Mongolian men’s team placed 35th out of 188 countries, while the women placed 15th out of 162.

When one thinks of Mongolia, one very probably thinks of horses and wrestling, but certainly not chess. But chess has a long history in the country. Mongolians’ ancestors played ankle bones and chess during the 13th century, and possibly before, while Mongolian traditional chess, shatar, dates back to the Great Mongol Empire.

The Mongolian word for international chess is in fact shatar. A medieval variation of the game is called Hiashatar, which means “Bodyguard Chess” (Shatranj). The pieces are the same as in traditional chess except that there is an additional piece called a Bodyguard (also called 'Senior Adviser' or 'Warrior'), which can slide one or two steps in any direction. However, a Bodyguard cannot checkmate the enemy king. 'Hiashatar' is believed to be about 500 years old.

A Mongolian chess, or shatar, set (Credit: Immanuel Giel, cc-by-sa 3.0).

An ancient legend about the origin of Mongolian chess tells of a khan, or king, who lived “long, long ago”. After fighting in many wars, he decided that training alone was not enough for victory. So, he established the position of bodyguard in his entourage, and the position was then added to the game of chess.

The Mongol names for the pieces are:

King - noyon (prince, duke)

Queen - bers (fantastic animal resembling a big dog)

Knight - mori (horse)

Rook - tereg (chariot, vehicle)

Bishop - teme (camel)

Pawn - fu (child, young)

Bodyguard - hia (senior adviser, warrior, bodyguard)

The first Mongolian national chess championship was held in 1948, and the country’s first women’s chess championship was held in 1954. The Mongolian Chess Championship is currently organised by the Mongolian Chess Federation (Mongolian: Монголын Шатрын Холбоо). Bazar Khatanbaatar holds the record for most national championships won, with eight victories; Tsagaan Battsetseg holds the women's record, with seven.

Chess is hugely popular in Mongolia, it's not unusual to see a game taking place on a bench (Photo courtesy of Antonio Graceffo).

One of the proudest achievements for Mongolians in international chess came in 1967 at the Sousse Interzonal when American Bobby Fischer played against Mongolian champion Lhamsuren Myagmarsuren. Myagmarsuren won the Mongolian national title four times in 1965, 1980, 1981 and 1982, and was awarded the title of international master in 1967. His nickname in the Internet Chess Club is "Shatar” (the Mongolian word for chess).

Although Lhamsuren Myagmarsuren lost to Fischer, the match resulted in a new technique called The Mongolian tactic. According to the tale, Fischer had asked Lhamsuren Myagmarsuren his name several times, but could neither spell nor pronounce it. So, he just wrote “Mongolian” on the paper. Since then, Lhamsuren Myagmarsuren’s special technique has been known as the Mongolian tactic.

In 2020, the International Chess Federation awarded stipends to a number of retired players including Lhamsuren Myagmarsuren. His match with Fischer has inspired Mongolian chess players down the decades. There is even a photo of Lhamsuren Myagmarsuren hanging in Zuunii Shatar chess club near the centre of Ulaanbaatar.

In recent years, Mongolia has repeatedly distinguished itself in international chess. Khulan Enksaikhan (25) led her team to gold at the 2020 Asian University Chess Championship (AUC). In 2021, 12-year-old N. Sodbileg won a silver medal at the under-17 World Amateur Chess Championship held in Rhodes, Greece.

In 2021, a most unique chess honour was won by Mongolia, when Mongolian inmates won the first ever Intercontinental Online Chess Championship for Prisoners. In October this year, the Mongolian women’s chess team won the 2nd Intercontinental Online Chess Championship for Prisoners. The event, organised by the International Chess Federation (FIDE) and the Cook County Sheriff’s Office (Chicago, US) was the largest chess event ever organised among correctional facilities.

International master and world grand master Batchimeg Tuvshintugs, who works at the Court Decision Making Agency of Mongolia, teaches chess in prisons and organiss tournaments. She explained that Mongolia has been organising chess events in its prisons since 1956, and it has now become a tradition.

FIDE president Arkady Dvorkovich attended the online closing ceremony where he congratulated the winning teams and extended a special message of encouragement "We all hope that at some moment of your life, you will be free to make your own choices, and chess will help you to make those choices rationally."

Tuvshintugs told Chess News that it was no wonder that the prisoners could play chess so well because the Mongolian amateur chess level was quite high, a sentiment supported by 76-year-old international chess master Jigjidsuren, coach of the Zuunii Shatar chess club, who believes that Mongolian children are exceptionally intelligent and particularly good at chess.

Jigjidsuren began playing chess in 1960 at the age of 11. He originally learned by watching his parents play in the countryside. Later, he studied under both Mongolian and Russian masters, eventually being admitted to the Russian chess university in 1971. He graduated in 1975. After a lengthy career as a world-class chess player, Jigjidsuren was asked to coach the national team, a job he did until he turned 70. Since his retirement, he has been coaching at Zuunii Shatar chess club.

Jigjidsuren explained “Mongolian children are very good at chess actually. The reason why is that Mongolians are much more intellectual and have a high brain capacity. And I came to this conclusion by observing many, many kids along the way of coaching and teaching lessons to the children.”

He estimated that 30 to 40% of the Mongolian population knows how to play chess. “We don’t have an exact number on this, but by observation, I have seen an instance where the whole town can play chess in the countryside. It is actually a rare occasion to find families without a chess board.”

When asked if Mongolians played chess in their gers (yurts) to kill time during the long winters, Jigjidsuren objected that while some may only be killing time, for most, “there is always a purpose when they are playing chess. The parents want their children to have a strong mind, a respectful manner and high potential, and they believe that chess helps in all those aspects.” He even drew a connection between herding and chess. “There used to be a lot of ways to educate kids back in the days of nomadic tradition.”

Chess is not only played in gers and chess clubs in Mongolia, it’s also played on the street.

Fifty-seven-year-old Naymtsogt is one of several chess experts who play outdoors, for money, on the benches in front of the central sports centre in Ulaanbaatar. He has been playing chess since he was seven. He first learned it from his parents, but later studied under Russian and Mongolian masters and grandmasters. While he can also play Mongolian chess, he focuses on international chess. Since 2008, he has been playing on the street, averaging five to six opponents per day.

Naymtsogt said that he particularly likes chess because, “There is nothing to cheat on in chess. It’s just simply a mind game. There is a lesson on how to start and how to proceed and how to end your moves and in chess you will be able to master it.”

After he defeated me in a relatively long game (pictured above), he said “You’re a very aggressive player. The game itself should be played like this.” Knowing I was a wrestler, he said wrestling was the same as chess. In Europe and America, catch wrestling is often referred to as physical chess. So, it was interesting to hear a chess master make the same comparison.

Jigjidsuren went on to draw more parallels between wrestling and chess. “Wrestling is a tradition which covers a minimum number of people that have a well built or developed body. For chess, it does not require anything physical or does not depend on gender. Secondly, chess is not a seasonal sport. You can play it anywhere you want, anytime.”

And the Mongolians do play chess anywhere, anytime. In the gers, in the streets, in the chess clubs and academies, in Russia, and at the world level.

Antonio Graceffo, PhD, China-MBA, is an economist and China analyst who has spent over 20 years in Asia, including seven in China, two and a half in Taiwan, and three in Mongolia. He conducted post-doctoral studies in international trade, at School of Economics Shanghai University, holds a PhD. from Shanghai University of Sport, and a China-MBA from Shanghai Jiaotong University. Antonio is the author of seven books about Asia, three of which are about the Chinese economy. For the past 10 years, he has been reporting on the Chinese economy, the US-China trade war, investment, geopolitics and defence. Since 2019, Antonio has been based out of Ulaanbaatar, where he continues his China economic research, while also reporting on the Mongolian economy. In addition to publishing reports and articles on a regular basis, he makes frequent appearances as a China economic expert on NTD TV, Bloomberg Mongolia TV and VTV.

J. Ganbaatar, Minister of Mining and Heavy Industry, met with Demus King, General Manager of Trade, Investment, and Investor Relations of the Minerals Council of Australia.

With a membership of BHP, Rio Tinto, and Yancoal Australia, the organization promotes and improves sustainable development, cooperation, and competitiveness in the mineral sector.

During the meeting, the parties exchanged opinions and information about the possibility of Australian mining and exploration companies investing and cooperating in conducting operations in Mongolia, as well as Mongolia’s geological resources and opportunities. Minister J. Ganbaatar provided information on the need to improve the legal environment in the fields of geology and mining and introduce high technology in exploration, and the government's policy on the mining sector. He also expressed that particular attention will be paid to creating a favorable investment environment in the field.

While highlighting that Geoscience Australia provides the government, communities, and industry with evidence-based scientific research to mitigate risks of companies that carry out geological exploration, Mr. Demus King mentioned the importance of introducing this standard in Mongolia, which significantly contributes to attracting investment. Both parties agreed to cooperate in the further development of the mining industry.

On the same day, Minister J. Ganbaatar met with Kassem Younes, Regional Director for Trade and General Manager of Victoria to the Middle East. According to the Ministry of Mining and Heavy Industry, they exchanged views on issuing special licenses for mineral exploration, rare earth elements, critical minerals, and copper exploration and mining and agreed to cooperate on a regular basis

Rio Tinto’s bid to complete a takeover of Turquoise Hill Resources has received a boost after the most vocal opponents of the deal agreed not to vote at the shareholder meeting that will determine whether the USD 3.3 billion deal goes ahead.

Rio has owned almost 51 percent of Canadian listed Turquoise Hill for a decade but this year moved to acquire the remaining 49 percent as part of efforts to simplify the ownership structure of Mongolia’s Oyu Tolgoi copper mine.

Turquoise Hill owns 66 percent of Oyu Tolgoi but outsources management of the project to Rio, and that structure has triggered years of acrimony and distrust between the Mongolian government, Rio and minority shareholders in Turquoise Hill.

Two of the most vocal critics of Rio’s involvement in the Mongolian project over the past decade have been Sailingstone Capital Partners and Pentwater Capital Management; both of which have spent time as the second-biggest shareholder in Turquoise Hill and both of which have expressed dissatisfaction with Rio’s $C43 per share takeover offer.

But on Wednesday morning Australian time, Pentwater and Sailingstone agreed to withhold their votes at next week’s meeting of Turquoise Hill shareholders that will determine whether Rio’s bid is successful.

Pentwater and Sailingstone will instead exercise the rights offered by a quirk in Canadian mergers and acquisitions regulations, which allows shareholders in a target company to nominate their shares as “dissenting”.

The price received by dissenting shareholders is determined through a subsequent arbitration process that has no influence over whether the deal goes ahead.

In that sense, dissenting shareholders like Pentwater and Sailingstone take the risk that an arbiter may consider fair value for their shares to be lower than the $C43 offered by Rio, but they do so in the hope the arbiter will judge fair value to be higher than $C43.

On face value, Wednesday’s agreement appears to boost Rio’s chances of success at the meeting that will be held in Canada on November 8, because it eliminates two Turquoise Hill shareholders that appeared to be inclined to vote against the offer.

Rio originally offered $C34 per share when it first lobbed the takeover bid in March. Turquoise Hill shares traded as low as $C4.60 during the market rout of March 2020, but the stock recovered to average $C20.59 in the past year

Rio raised the bid to $C40 in August and $C43 in September, but proxy advisory firm Institutional Shareholders Services (ISS) has still told clients to reject the $C43 offer. Turquoise Hill shares were fetching $40.36 at the close of Canadian trading on Wednesday morning Australian time.

Copper was fetching $US3.49 per pound on Wednesday; prices for the red metal have declined by 24 percent since Rio lobbed its bid.

London | Rio Tinto’s partner and takeover target, Turquoise Hill, is fighting a rearguard action to prevent the Mongolian government from raking over the cost blowouts and delays at the mammoth $US6.9 billion ($10.9 billion) expansion of the Oyu Tolgoi copper mine.

In a letter seen by The Australian Financial Review, Canada-based Turquoise Hill’s interim CEO, Steve Thibeault, rejects a move by the Oyu Tolgoi LLC’s board of directors – dominated by the Mongolian side of the venture – to expand an agreed audit to include the project’s controversial “cost variances and overruns”.

Copper concentrator at Rio Tinto’s Oyu Tolgoi mine in Mongolia. Rio Tinto

The renewed tension over the copper mine comes at an awkward time for Turquoise Hill, the two-thirds owner of Oyu Tolgoi LLC, which is entertaining a $US3.3 billion takeover offer from Rio Tinto for the 49 per cent that Rio does not already own.

If Turquoise’s bid to row back the Oyu Tolgoi board’s decision is unsuccessful, the auditors – overseen by an Oyu committee – would rake over the controversy and potentially add further grist to a class action launched by one of Turquoise’s biggest shareholders.

It would also challenge the suggestion from Rio Tinto and Turquoise Hill that their tensions with the Mongolian government are now fully resolved.

The Mongolians’ previous reservations about the project appeared to have been settled by a deal in January under which Rio Tinto waived a $US2.4 billion debt it was owed by the Mongolian government.

But the document seen by the Financial Review suggests the frictions continue, with Mr Thibeault admonishing the board for its decision to “revisit past issues”.

These issues – the question of how and why the project’s costs blew out, and whether, when and how Rio and Turquoise disclosed those overruns – are also under scrutiny in a class action launched by major Turquoise shareholder Pentwater.

The class action alleges that the cause of the delays and cost overruns had been flagged by employees, but communications with investors suggested otherwise.

Rio and Turquoise commissioned Independent Consulting Group to look into some of these insider claims. ICG’s report in August 2021 found that poor project management, rather than technical issues, were responsible for the problems.

The ICG report recommended that Oyu Tolgoi LLC conduct further audits, one covering the “industry-accepted project management practices for large underground” and the other evaluating the “go-forward costs and schedules”.

Turquoise had accepted these audits, but at the September 21 meeting of the Oyu Tolgoi board, the Mongolian directors pushed through a broader audit proposal that looked back at the cost overruns and delays. The audit may also apparently scrutinise tax and transfer pricing issues.

Mr Thebault said this went beyond the scope of what had been previously agreed, and revisited the issues already covered off by the ICG.

He said the “past issues” had been resolved and the audits should “focus on the future”.

“Such an audit is not within the spirit of the Peer Review’s recommendations, which are forward-looking in nature,” he wrote.

He called for another board meeting “as soon as possible” to revisit the decision and take account of Turquoise’s views.

Rio’s bid to take over Turquoise is delicately poised. Two of the most vocal critics of Rio’s involvement in the Mongolian project over the past decade have been Sailingstone Capital Partners and Pentwater Capital Management; both of which have spent time as the second-biggest shareholder in Turquoise Hill and both of which have expressed dissatisfaction with Rio’s $C43 per share ($49.46) takeover offer.

This week, both agreed to withhold their votes at next week’s meeting of Turquoise Hill shareholders that will determine whether Rio’s bid is successful.

They will instead exercise the rights offered by a quirk in Canadian mergers and acquisitions regulations, which allows shareholders in a target company to nominate their shares as “dissenting” – suggesting they are holding out for a higher price, at the risk of having to accept a lower one. Rio Tinto has already twice had to raise its bid.

The government has announced 2023 and 2024 as the “Years to Visit Mongolia”. The Ministry of Environment and Tourism informs that within the framework of the project that will launch at the beginning of next year, all the ministries including all the relevant branches of digital communication, intercommunication, road, transportation, air transport and services will be involved in coordination.

The working sub-groups to ensure the preparations for the upcoming “Years to Visit Mongolia” were set up at the first meeting of the National Committee for Tourism Development headed by the Prime Minister. Specifically, coordination and participation of the Ministry of Foreign Affairs, Ministry of Road and Transport Development, Ministry of Culture, Ministry of Digital Development and Communications is needed.

The Ministry of Environment and Tourism emphasizes the need for all government ministries to support the tourism industry, starting with cultural promotion overseas.

Mongolia's tourism industry received a record-high 577,000 foreign tourists in 2019 and earned USD 607 million from the industry, which accounted for 6.4 percent of the GDP of 2019. During the COVID-19 pandemic, Mongolia received 58,000 in 2020 and 33,000 in 2021 respectively. Since Mongolia opened its border to foreign travelers in February 2022, it received 210,000 tourists and earned MNT 750 billion. The number of tourists this year is expected to reach 250,000 and the income to MNT 1 trillion.