Foreign direct investment (FDI) is expected to reach USD 200-300 million next year, according to the Bank of Mongolia (BoM). It directly depends on the Oyu Tolgoi (OT) project progress. The investor of the project had announced that the first sustainable production is expected between May 2022 and June 2023, which is a delay of 16-30 months compared with original guidance, while the cost of the USD 5.3 billion will increase by USD 1.2-1.9 billion. More detailed estimates will be introduced in the second quarter of next year and the feasibility study is expected to be updated in the latter half of the year. In this regard, the amount of investment in the OT project will reduce to USD 970 million from its planned USD 1.2 billion in 2020, the central bank said. In the first 10 months of this year, foreign direct investment reached USD 1.56 billion, a six percent decrease from the previous year, of which Oyu Tolgoi LLC made 75-80 percent alone.Thus, the government's decision to cease exploration license for one year significantly diminishes the exploration activity of foreign and domestic investors. As of October 2019, exploration activities were activated in 104 fields, with MNT 18.9 billion being collected to the state budget, according to the Mineral Resource and Petroleum Authority of Mongolia (MRPAM).

Published Date:2020-01-02