ULAANBAATAR, Mongolia, Nov. 30, 2021 (GLOBE NEWSWIRE) -- Steppe Gold Ltd. (TSX: STGO) (“Steppe Gold” or the “Company”) today announces the filing of a technical report (the “Technical Report”) on its 100% owned Altan Tsagaan Ovoo Project located in Mongolia regarding the Phase 2 Expansion Project.

The Technical Report titled “NI 43-101 Technical Report – Feasibility Study for the Altan Tsagaan Ovoo (ATO) Phase 2 Expansion Project Mongolia” has been prepared by DRA Global Limited (DRA). The Technical Report is available under the Company’s profile on SEDAR at www.sedar.com and on the Company’s website at www.steppegold.com.

Steppe Gold is Mongolia’s premier precious metals company.

Chief of the General Staff of the Armed Forces and first Deputy Defense Minister of the Russian Federation, Army General V.V. Gerasimov paid a courtesy call on President of Mongolia and Commander-in-Chief of the Mongolian Armed Forces U. Khurelsukh today, November 30.

President U.Khurelsukh noted that the Mongolian and Russian people have been together in difficult times of war and even in building peace. The President expressed confidence that the visit of the Chief of General Staff will give an important impetus to the bilateral relations and cooperation in defense sector, in particular the Armed Forces.

Chief of the General Staff of the Armed Forces and first Deputy Defense Minister of the Russian Federation, Army General V.V. Gerasimov expressed satisfaction with the relations and cooperation between defense sectors of the two countries, citing the example of the Selenge joint military exercise being organized every year, as well as training of Mongolian servicemen at military academies and universities in Russia.

During the meeting, the parties exchanged views on further development of military and military-technical relations and cooperation between the two countries.

On November 29, Minister of Mining and Heavy Industry G.Yondon presented the bill to make amendments to the Law on Petroleum to Speaker G.Zandanshatar.

Currently, Mongolia imports 100 percent of its demand for petroleum, which in turn makes its domestic market price reliant on global market price, foreign exchange rate as well as the price set for import from Russia and other countries.

As aviation fuel is 28.8 percent more expensive in Mongolia compared to the price in other countries, domestic civilian aviation companies prefer to refuel their aircrafts abroad: 57 percent of the fuel filled abroad.

In connection with the project for the new Chinggis Khaan International Airport, the Minister of Mining and Heavy Industry was tasked to take necessary measures to resolve the matter concerning the supply of fuel for the new airport by expanding the operations of Mongol Refinery State Owned LLC. Thus, a subsidiary was established under the name, ‘Erchis Oil’ State Owned LLC per the Minister’s order issued in 2020.

During the talks held with foreign investors that expressed their interest in supplying fuel for the airport, ‘Erchis Oil’ State Owned LLC received a suggestion for cooperation from RN-Aero, a subsidiary of the Russian oil company Rosneft.

However, Article 7.2 of the Law on Petroleum states that a foreign entity, who is solely supplying no more than 30 percent of total oil to Mongolia, is prohibited to sale its products on the domestic market through its invested entity or its units. This article limits the opportunity for the state-owned company to cooperate with foreign supplier for fuel supply at the airport. Thus, in the framework of the measures being taken to expand the operations of Chinggis Khaan International Airport as well as to support the supply of fuel at a competitive price for various aircraft operating in Mongolia and going through the country’s territory, a bill was drafted to make amendments to the article.

On November 29, Capital City Road and Transport Projects Manager B.Odsuren introduced works being carried out to reduce traffic congestion in the capital city during a press conference..

Noting that research, blueprints, feasibility studies, and consultations are taking place in phases to reduce traffic congestion in the capital city, he emphasized that the blueprints have been developed for the construction of new primary and secondary roads at a total of 90 locations in the city. Furthermore, necessary preparations are planned to be carried out for light rail transit (LRT), parking lots, new pedestrian roads and bike paths. This includes infrastructure, green space, and flood protection dams, highlighted the capital city official.

Regarding the introduction of cable cars in the capital city, he said, “A working group was established by the government, which convened three times so far. Its first route is planned to be established between Bayankhoshuu and the III microdistrict. As some households in the area have refused to allow such structure to be built on their land, the team has made a conclusion to change the route, taking into account other potential risks.”

The cable car project is being financed through a soft loan being provided from the Government of the Republic of France. “In order to increase the project’s benefits and profits, we are making appropriate changes to the route. We will introduce the matter in greater detail in the coming year,” he said.

As for what other measures are being planned with MNT 420 billion allocated for reducing traffic congestion in the capital city, project and program advisor to the Governor of the Capital City Ch.Batzorig noted " In the next three years MNT420 billion will be spent annually for reducing traffic congestion, according to the Government resolution N146. A total of 42 projects, including road, road facilities, bridges and LRT will be financed with the budget. 500 buses will be renewed in 2022 through public-private partnership.

Turquoise Hill Resources Ltd. announced yesterday that, in light of the progress made in the ongoing negotiations between the Government of Mongolia, Rio Tinto and the Company, the Board of Directors of OT LLC approved a bridging budget of USD 75 million to continue to progress critical activities in the Oyu Tolgoi underground mine development project. The Company expects that the approved increase should be sufficient to sustain work on the development of the OT underground mine up to mid January 2022.

While the Company believes that the decision to approve the bridging budget was a necessary and positive step in the near term, the Company cautions that there can be no assurance that the OT Board will approve any future necessary additional investments to further progress underground development and accordingly OT LLC remains at risk of having to slow down further work on the underground development.

Last week, Rio Tinto Ltd boss Jakob Stausholm has made his first trip to Mongolia while in the top job to meet Prime Minister L.Oyun-Erdene as Rio looks to revive a relationship that has soured over the development of a big copper mine.

Rio has faced costly delays at the underground expansion of its Oyu Tolgoi project that it has blamed on geotechnical difficulties and COVID-19, angering the Mongolian government and shareholders of developer Turquoise Hill Resources TRQ.TO in which Rio has a majority stake.

Rio last month delayed first production at the underground development of Oyu Tolgoi by three months to January 2023, after Turquoise had estimated additional funding required for the project had ballooned to $3.6 billion.

Delays to development of what will be one of the world’s largest copper mines has antagonised the Mongolian government, which owns a 34% stake, and fuelled a funding spat between Rio and Turquoise Hill.

Quietly, slowly but surely, Mongolia is building a team that in the coming years may be fearsome. It is one of the countries that is fortunate to have both men and women and is presenting its new pearls in society.

The world already know Ts.Tsogtbaatar, whose career at U73kg is becoming meteoric, with two world medals and one Olympic medal, in addition to his brand-new lead in the category. Now Mongolia also has a heavyweight, O.Tsetsentsengel. He is the latest product of a delegation that has managed to combine youth and seniority with wisdom. It is a country that also has Saeid Mollaei.

Ts.Tsogtbaatar in the men’s -73 kg and Ts.Tsetsentsengel both claims two Grand Slam golds for Mongolia.

Looking ahead to next year, IJF President Marius Vizer and Mr Kh.Battulga, Former President of Mongolia, and President of the Mongolian Judo Association, signed the contract for the Mongolian Grand Slam, officially bringing Ulaanbaatar back to the World Judo Tour!

The Ministry of Health reported that 393 new cases of COVID-19 have been reported in the past 24 hours. Specifically, 268 cases were confirmed in Ulaanbaatar city, with 125 cases in rural regions.

As of today, the total number of confirmed COVID-19 cases in Mongolia stands at 382,716.

Furthermore, eight new COVID-19 related deaths have been reported, raising the country’s death toll to 1,930. Currently, 5,645 people are receiving hospital treatment for COVID-19 whilst 10,853 people with mild symptoms of COVID-19 are being isolated at home.

Of the total patients currently undergoing treatment at hospitals, there are 2,193 patients in mild, 2,636 in serious, 707 in critical, and 109 in very critical conditions.

As of today, October 15, the coverage of 1st dose is 69.5 percent (2,260,178) and 2nd dose – 66.1 percent (2,150,479) of the total population. Moreover, 656,015 people (20.0 percent) have received 3rd dose or a booster shot of COVID-19 vaccines nationwide.

Eritrea and Guinea-Bissau have announced plans to join the Belt and Road Initiative (BRI), actively promoted by Beijing. The two nations have reportedly signed a formal agreement with China ahead of a key regional forum.

The ambitious multi-trillion-dollar BRI, also known as the New Silk Road, was announced by President Xi Jinping in 2013, aiming to boost connectivity and cooperation between East Asia, Europe, and East Africa. The major project is expected to significantly expand global trade, cutting trading costs in half for the countries involved.

G7 nations seek to counter China’s Silk Road projects with ambitious infrastructure plan

Eritrea is seen as strategically important due to its access to the Red Sea and the Suez Canal, as well as to waters in the Persian Gulf, and thus to the Indian Ocean.

Meanwhile, the Atlantic Ocean nation of Guinea-Bissau is expected to boost China’s maritime interests along the West African coast. The country is a member of the African Continental Free Trade Agreement (AfCFTA) that removed border tariffs between African nations.

China has committed to building a $184 million biomass plant in Guinea-Bissau, and is reportedly involved in several redevelopment projects in the country. Beijing is reportedly supporting a $48-million project aimed at renovating the antiquated telecommunications system and highway construction. Chinese investors have also expressed interest in the logging sector, deepwater fisheries and oil exploration.

Beijing is planning to help Eritrea to bring back trained labor, to develop infrastructure in the country, and “wean it off an agricultural base to a higher standard of industrialization.” Back in 2019, the China Shanghai Corporation for Foreign Economic and Technological Cooperation (SFECO) began construction of part of the 500km road between the country’s port city of Massawa and Assab harbor, both of which possess special economic zones.

The two African states inked the Memorandum of Understanding days before the forthcoming FOCAC Ministerial Forum in the Senegalese capital of Dakar, which kicks off on November 29.

As we are approaching the end of the year we look ahead to important trends in politics, economic and investment conditions in Mongolia.

2022 is going to be a crucial year for the country to recover from the COVID-19 pandemic as the government focuses on digitalization and some liberalization in select sectors.

2022 is also an off-election year consolidating policy directions before the general election cycle begins in late 2023.

What You Need To Know

The election of former Prime Minister Ukhnaagiin Khurelsukh to the presidency in June 2021 secured the ruling Mongolian People’s Party’s (MPP) political dominance in the coming years. Khurelsukh will serve one six-year term and will be a key player in laying grounds for the re-election of the MPP in 2024.

Businesses can expect a more stable business and investment environment as the ruling party controls the presidency, premiership and Parliament.

The reform of mining and investment laws has yet to progress mainly due to rising resource nationalism and populism. Anti-foreign — and anti-Chinese —sentiment prompted a reversal of investment law liberalization.

The MPP may look to expand state involvement in key sectors like coal and copper mining and fossil-fuel-powered infrastructure. However, increased budgetary hardships and rising social inequality may open up certain sectors as fintech, nascent renewable energy, untapped tourism and entertainment.

Although the 2021 growth is expected to be lower than expected at around 4 percent, its economy is projected to accelerate by 7.5 percent.

Following the Glasgow climate summit, President Khurelsukh rolled out a one-billion-tree planting campaign by 2030 to help combat desertification and environmental degradation in the country. This also addresses China’s request to deal with sandstorms coming from Mongolia every spring and could help to further boost bilateral cooperation between the two countries.

Ruling Party Dominates Divided and Weak Opposition

The far-left Mongolian People's Revolutionary Party (MPRP), which broke off from the MPP in 2010, rejoined the ruling party in early 2021. As the MPP continued to consolidate its power, in contrast, the leadership of the largest opposition party — the Democratic Party (DP) — broke up following the end of Khaltmaagiin Battulga’s presidential term. DP’s split has become a real possibility, making it a very weak opposition to the MPP government.

Pockets of anti-lockdown and anti-government protests online and on the streets of Ulaanbaatar are continuing. A spike in social unrest in 2022 is possible but unlikely to spread widely. Most tensions are fueled by political elites for their own personal agendas.

However, public dissatisfaction with heavy- handed COVID restrictions on small businesses and vendors should not be discounted if incomes and quality of life suddenly drop.

Cabinet Reshuffle Looms as Two New Cabinet Posts Added

Prime Minister Luvsannamsrain Oyun-Erdene is adding two cabinet portfolios overseeing digital transformation and long-term economic development. The new ministries would allow the prime minister to push the implementation of the Mongolia 2050 Vision and accelerate the country’s transition to conducting more business online.

The new additions may result in a cabinet reshuffle as different factions within the MPP demand more ministerial seats and the public calls for the dismissal of unpopular and underperforming ministers.

COVID Risks Remain Despite Effective Response

The government’s response to COVID has been effective and speedy, with two-thirds of the population having received two vaccine doses ahead of many other countries. Total deaths have been kept at a minimum at about 2,000. Travel restrictions were lifted in June and COVID restrictions have been eased as schools and offices reopened in September.

The Finance Ministry and central bank are gradually cutting down the two-year-old pandemic aid, which has been key to wooing voters during the 2020 legislative and 2021 presidential elections. State subsidies on utility payments and cheaper loans are expected to be pulled back in 2022. Child benefits will remain, and parents have been asked not to make immediate spending decisions.

Disruptions at the Chinese Border Delay Key Earnings

Mongolia targets at least 36 million tons of coal exports to China in 2022, capitalizing on the ongoing global energy crisis. However, due to on-and-off border closures at the checkpoints following COVID breakouts in China, Mongolia risks failing to achieve that target and taking advantage of the short-term commodity price hike.

By Q3 2021, Mongolia only exported 16 million tons of coal. This was mainly due to multiple disruptions along the border with China through which thousands of Mongolian truck drivers cross since the commodity rail to northern China has yet to be completed. Mongolia does not plan to cut coal mining, which is a key export earner.

Crypto on the Rise Amid Banking Liberalization

While replacing the tugrik with cryptocurrencies is very unlikely, the development of digital currencies in the form of decentralized cryptocurrencies and private sector digital currencies and tokens has gained pace. Domestically mined coins like ArdCoin and Inflation Hedging Coin (IHC) took retail investors by a storm in 2021 who were looking to reshape Mongolia’s financial landscape.

Lawmakers want to tightly control the use of digital assets, but the cryptocurrency ecosystem is poised for further growth as more Mongolians look for ways to access the global financial system.

Five of the biggest commercial banks making up almost 80 percent of the financial industry are going public in the second half of 2022.

By law, they must break up concentrations of individual and family ownership. Bankers with links to elite politicians are concerned about increased competition from international players.

Regulatory Reforms Hit Nationalist Roadblock

Review of the 2013 investment law hit a roadblock following a recent wave of anti-Chinese sentiment. This was stoked by suspicion that the liberalized investor immigration program could bring in an uncontrolled number of Chinese immigrants. The proposed changes in the law have been withdrawn after the public backlash.

Revisions in the mineral law to abide by Mongolia’s 2019 constitutional amendments would require majority state ownership in key mineral deposits. If passed, this would limit private interests in the resources sector.

Lawmakers continue to prioritize investment in non-mining sectors like beef exports, nascent solar and wind energy, tourism, entertainment and movie production for global audiences.

China’s recent pledge to stop building new coal power plants overseas has opened new opportunities to unlock Mongolia’s huge wind and solar energy potential. The country’s massive Gobi Desert, which is next door to China, could provide fertile ground for solar power generation and exports.

by: Amar Adiya