Eighteen enterprises have begun building and expanding 22 petroleum product storage facilities — some of these facilities will become operational within days. The construction of the fuel storage facilities is due in part to support from the government and concessional loan financing.

Prime Minister Uchral Nyam-Osor visited the construction of the petroleum storage facilities of San Petroleum LLC and Shunkhlai LLC on August 8.

San Petroleum LLC is building a facility with a capacity of 16,000 m³ in the 20th khoroo of Songinokhairkhan district. An 8,000 m³ portion of this represents a total investment of MNT10 billion — financed through concessional loan from a commercial bank at an annual interest rate of 9%. Construction of the storage facility is 95% complete and is due to be fully operational by August 20. Once operational, the facility will fully cover 13 days of Ulaanbaatar's AI-92 petrol consumption. The Prime Minister instructed the relevant authorities to ensure that no permitting obstacles delay the facility's commissioning.

Shunkhlai LLC, meanwhile, is building what is considered Mongolia's largest petroleum storage facility, with a capacity of 100,000 m³, in the 21st khoroo of Songinokhairkhan district, just few steps apart from the San Petroleum facility. The plan calls for seven vertical steel tanks, each with a nominal capacity of 14,000 m³, a diameter of 36 meters, and a height of 14.5 meters. The total investment amounts to MNT 151.26 billion. It is also financed through concessional loan with a similar annual interest rate of 9% as San Petroluem. Construction for this facility is at 40% and is scheduled to be fully commissioned by December 31, 2027. Once operational, the facility will hold an additional 8 to 9 days of national consumption in reserve.

Uchral at the construction site said, "For the first time in 33 years, the government has begun building petroleum reserve storage — 22 facilities in total. It has also broken the deadlock on the oil refinery project, which had been stalled for two years: construction, which had halted at 20%, has now resumed and reached 60%. Work on oil supply and exploration, stalled for 30 years, has likewise begun, with an international open tender announced for 14 sites." Uchral added, "The government, is working at every level to counter price increases and to withstand the negative effects that global conditions could have on the country."

Beyond Ulaanbaatar, projects are also underway in Umnugovi aimag (four facilities, 37,000 m³, MNT 34.1 billion), Darkhan-Uul aimag (two, 11,000 m³, MNT 10.8 billion), Bayan-Ulgii aimag (two, 5,200 m³, MNT 7.5 billion), Orkhon aimag (one, 8,000 m³, MNT 7.5 billion), and Khovd aimag (one, 10,000 m³, MNT 8.7 billion).

Construction of these facilities are more widely on their progression: some are near completion, some are just starting construction. According to the government six facilities that are more than 85% complete — belonging to Morit Govi Oil LLC, Tes Petroleum LLC, San Petroleum LLC, Sod Mongol Group LLC, Wellcom LLC, and Petroline LLC — have entered the final stages of construction and are now undergoing equipment installation, testing, calibration, and preparations for commissioning.

The enterprises that received concessional loans have signed liability agreements with the Mineral Resources and Petroleum Authority, the state administrative body responsible for petroleum affairs.

"The 2027 state budget will continue the policy of supporting enterprises to expand fuel storage capacity," said Damdinnyam Gongor, Minister of Industry and Mineral Resources. "The country will gain the capacity to store up to three months of consumption, meaningfully reducing the risks and difficulties associated with sudden fuel price spikes and shortages that can arise over the short term. Concessional loans will be provided to all qualifying enterprises that have a construction site, a design, and meet the requirements," the minister said.

Published Date:2026-08-11