Oyu Tolgoi announces performance results for fourth quarter of 2019 www.montsame.mn

Ulaanbaatar /MONTSAME/. Today, February 12, Oyu Tolgoi CEO Armando Torres along with the company’s senior managers held a press briefing to introduce the performance results for the fourth quarter of 2019.

Some highlights of the Oyu Tolgoi mining project’s performance in 2019 are:

• Oyu Tolgoi continued its globally competitive safety performance

• Total in-country spend has passed US$10 billion

• US$321 million taxes paid and US$431 million on national procurement in 2019

• Maintains the guidance for copper production – 146,346 tons of copper in concentrate

• Exceeds 2019 full-year production guidance for gold – 241,840 ounces of gold in concentrate

• Completed the construction of primary production shaft (Shaft 2) of the underground mine

• Reached highest performance record for the underground lateral development

In 2019, Oyu Tolgoi continued to progress and deliver important milestones for the underground mine development and make a significant contribution to the Mongolian economy, passing U$10 billion of in-country spend.

Prioritizing and maintaining excellence in safety, Oyu Tolgoi’s All Injury Frequency Rate (AIFR) was 0.16 per 200,000 hours worked in 2019.

As of 31st of December 2019, over 93 per cent of Oyu Tolgoi’s workforce of 13,800 were Mongolian with more than half working on the development of the underground mine. Oyu Tolgoi provided 680,354 people-hours of training in 2019.

Within this scope, Oyu Tolgoi provided the internationally recognized and accredited training to its 348 employees in the last year in cooperation with Holmesglen, the registered training organization in Australia.

In 2019, Oyu Tolgoi paid US$321 million in taxes, fees and other payments and collaborated with 838 suppliers, 564 of which were Mongolian businesses which accounted for 76 percent of total operations procurement spend.

Partnership was a key priority in 2019, with Oyu Tolgoi contributing to public health, primary education, infrastructure and many other areas.

In terms of major infrastructure projects, the highlights were the opening of the Oyu Tolgoi-Khanbogd 35.1-km paved road, the opening of a new hospital in Mandal-Ovoo soum, and the completion of the fifth kindergarten in Umnugovi province, sponsored by the Oyu Tolgoi funded Gobi Oyu Development Support Fund.

Underground Development Update

Construction of the primary production shaft (Shaft 2) was completed in October 2019, which allows the movement of 300 people per cage cycle versus a maximum of 60 people per cage cycle through Shaft 1. Underground development materials will be lifted to surface via the Shaft 2 production hoist.

Productivity improvement measures resulted in increased underground lateral development rates during the fourth quarter, with an average rate of 1,607 equivalent meters (eqm) compared to 1,214 eqm in the third quarter, with December seeing a record of 1,809 eqm.

Construction is progressing on Shafts 3 and 4 with both collars now installed. Final preparations are now underway to enable commencement of main sinking operations for both shafts during the second quarter of 2020.

"We continue to expect to complete the mine design in the first half of 2020 and the Definitive Estimate of cost and schedule in the second half of 2020."

Production for fourth quarter of 2019

As anticipated, mined copper production from the open pit was eight per cent lower than 2018 as mining activity moved to lower grade areas. Grades were 11 per cent lower for the year reflected in the 21 per cent decline in fourth-quarter production, partly offset by productivity improvements.

Other highlights:

Full-year copper production in concentrate of 146,346 tons vs original guidance range of 125,000 – 155,000 tons in concentrate
Full-year mill throughput of 40,777,225 tons, an increase of 5 per cent over 2018
Full-year gold production in concentrate of 241,840 ounces vs original guidance range of 180,000 – 220,000 ounces in concentrate

MNCCI offers force-majeure certificates free of charge www.montsame.mn

Ulaanbaatar /MONTSAME/ Considering the widening quarantine restrictions in China due to the coronavirus outbreak, the Mongolian National Chamber of Commerce and Industry (MNCCI) is offering certificate of force-majeure to the entities free of charge within its social responsibility action.

Financing agreement signed for World Bank Livestock Commercialization Project www.montsame.mn

Ulaanbaatar /MONTSAME/. On February 7, the Ministry of Finance of Mongolia and the World Bank signed Financing agreement for the Livestock Commercialization Project.

The project, funded with $30 million loan financing from the World Bank, will be implemented in 150 soums of 14 aimags and Ulaanbaatar city. It aims to improve the health and productivity of livestock and increase value of products, such as meat and dairy by commercializing targeted value chains in selected locations.

The signing ceremony was attended by Minister of Food, Agriculture, Light Industry Ch.Ulaan and other relevant officials as the 5-year project will be implemented by the Ministry of Food, Agriculture, and Light Industry of Mongolia.

The project will help improve the health and productivity of livestock and increase value of products such as meat and dairy by commercializing targeted value chains in selected locations.

With more than 60 million livestock and wide pastureland, the Mongolian agriculture and livestock sectors have huge potential to drive economic diversification and as a key source of broad-based employment.

However, major challenges such as low productivity, animal health issues, and vulnerability to climate change and extreme weather events, limit the sector’s potential. About 56 percent of Mongolia’s herders own 200 head or fewer of livestock and are trapped in a low-input, low-output, low-productivity cycle.

Animal disease, coupled with poor food hygiene and inadequate nutrition, limit the output and quality of meat and dairy products. As a result, Mongolian meat exports have stagnated at less than 10 percent of their potential despite the country’s proximity to the region’s largest markets for meat imports.

The new project aims to improve the quality of and access to veterinary services nationally and help establish trans boundary animal disease free zones. The project will help improve performance of the Mongolian Veterinary Services Authority to effectively control animal diseases, promote responsible use of antimicrobials, provide veterinary public health services, and improve food safety in line with international standards, according to World Bank Mongolia.

In addition, the project will improve livestock productivity and increase the volume of livestock products that meet market requirements by promoting partnerships between producers and processors. Collaborative research with academic and research institutions, as well as investments to improve animal breeding and nutrition services, will also contribute to this goal. Moreover, the project will provide immediate response in the event of an eligible crisis or emergency.

In particular, the project is deemed to eliminate livestock diseases cases by 25 percent at minimum, increase animal meat and milk outputs by 15 percent, involving 20 thousand herders directly and improving the value of livestock meat products by 20 percent.

As a result of the project, competitiveness of the livestock industry and exports market to be expanded with improved benefits of livestock animals and improved livelihoods for herders.

“Livestock and Agricultural Marketing Project” with grant aid of USD 11 million from the World Bank was implemented throughout 15 soums of 5 aimags of Mongolia between 2013 and 2017, reports the Ministry of Finance.

The project, aimed at establishing connection between herders with markets and consumers, improving livestock animal breeding and developing livestock industry value chain, covered 140 thousand herders to result in 78-percent growth in their incomes from livestock products.

Mongolia suspends coal exports to China on coronavirus fears www.reuters.com

ULAANBAATAR (Reuters) - Mongolia will suspend deliveries of coal across its southern border into China until March 2 to prevent the spread of the coronavirus, the country’s National Emergency Commission said on Monday.

Mongolian fined for spreading fake news about coronavirus spread in Mongolia www.akipress.com

Mongolian was fined 2 million tugriks for spreading fake news on coronavirus infection in Mongolia.

Russia, China to assess prospects of laying gas pipeline via Mongolia www.tass.com

MOSCOW, February 10. /TASS/. Russia and China continue negotiations on the ‘western route’ of gas supplies to China (Power of Siberia 2) contemplating deliveries of 30 bln cubic meters of gas per year and the parties are assessing prospects of laying the pipeline across Mongolia, Russian Energy Minister Alexander Novak said in his article in the Energy Policy magazine.

Export decreases by more than 20 percent in January www.zgm.mn

In January, exports totaled USD 459 million, decreasing by 24.4 percent compared to the same period of the previous year. According to the Customs General Authority (CGA), imports surpassed exports for the first time since September 2014 with a loss of USD 14.3 million. The sharp decline in crude oil sales was one of the key drivers. Copper and ore concentrate sales declined by nearly 30 percent. Excluding raw coal, most of Mongolia’s exports have declined. However, export revenue was up 20 percent year­-on-­year. Despite the restriction on movement in line with the new types of coronaviruses, mineral exports from major ports are continuing to operate normally, the CGA said.

Oyu Tolgoi in-country spend passes US$10 billion www.montsame.mn

Ulaanbaatar /MONTSAME/. Oyu Tolgoi LLC, Mongolia's largest copper and gold mining company, today announced that the company has reached US$10 billion in total in-country spend since 2010, marking the largest foreign investment made in the country.

Mongolia setting up its research station in Antarctica www.montsame.mn

Ulaanbaatar /MONTSAME/ Minister of Environment and Tourism N.Tserenbat met with Director of the Antarctic Research Center of the Mongolian University of Science and Technology, Antarctic researcher L.Dugerjav at his request.

King Tug suffers first defeat of professional career www.news.mn

Mongolia’s King Tug (N.Tugstsogt) suffered the first loss of his professional career when WBC featherweight champion Gary Russell Jr. defended his title on Sunday at PPL Center Center in Allentown, Pennsylvania.