Key economic ativities’s reviews included government action and investments for mining, energy, high-technology products, as well as environmental rehabilitation...

The Mongolian Prime Minster, S.Batbold, met those engaged in mineral resource and energy sector operations on November 23, 2009 to discuss the current situations, priorities and further tasks within these sectors.

PM S. Batbold talking to minerals and energy sector officials

Noting that the Mongolian joint Government’s major goal is to ensure that every Mongolian has a job, PM Batbold said, “To achieve this goal, we will need to undertake more projects and campaigns for industrialization and promote any work required for construction”.

“During the last 20 years, Mongolia had only a few large projects which could be regarded as equal
to the Erdenet Copper Mine, Bor-Ondor Fluorspar Plant, Hotol Cement Producer, Baganuur Coal Mine and the Shivee-Ovoo Coal Mine,” the PM stated.

Continuing the PM mentioned that recent discoveries of major mineral deposits has included the Oyu Tolgoi Copper Deposit.

“Mongolia‘s energy sector still depends too heavily on State Budget investments and foreign loans,
and its priority remains to urgently find solutions. Our need is to meet increasing energy demands and we must, therefore, pursue a policy that will cover investments, management and energy exports.”

“Although we have enormous market potential to export energy and mineral raw materials, we still lack investments for a reliable energynetwork system and for production with high technology,” the PM
stressed, adding “We need to do our best to carry out mega-projects for development, using the major opportunities already available.”

The Premier urged relevant officials to accelerate the Oyu Tolgoi Project’s activities as it will provide
impetus for country’s development.

OT’s mine site activitiess

Mr. Batbold tasked the relevant Ministry to focus on pending mining projects, such as, the Tomortei Iron Ore; Burenkhaan Phosphorus Deposit, as well as the Mardai and Dornod Uranium and Asgat Silver Projects.

Mr. Batbold urged the Tavan Tolgoi Coal Project’s task group to immediately present the Project’s concept to Government and Parliament for their decisions, also instructing the relevant officials to accelerate project proposals, such as, supplying energy to Mongolia’s southern region, Ulaanbaatar‘s New Power Plant, and the Power Plant to be based on the Tsaidam Coal Deposit.

Continuing, the PM confirmed that the State’s policy is to promote exporting value-added and hightechnology products in order to increase jobs, people’s incomes, and to create a labor force with better skills.

PM Batbold said that Mongolia needs to set up large companies that will contribute to country’s economy, such as, the Mongol Erdes’ Mineral Resources, Mongol Erchim Energy Company, and Mongol Ded Butets Infrastructure Company, which trade their stocks on both local and international markets and instructed relevant officials to make efforts in this regard.

“Private investment is another requirement for the country’s development and, therefore, we need
to make policy changes so as to attract further private economic investments, increase jobs and improve people’s sustainable living conditions. It is also important to have competitive and stable State policies in regard to tax and business environments and these must be clear to foreign and local investors.

The PM promised to give more attention to coordinate the State’s legislature to improve artisanal mining conditions as this is a vital issue for the survival of many thousands of people and their children.

He asked energy sector officials to: improve the sector’s reliability; take measures to meet increased
energy demands; promote private investment in the sector; and find further possibilities to export energy.

The Minister warned that these sector’s officials’ work results would be evaluated according to their
achievements in regard to power plants, energy companies, and Ulaanbaatar’s air pollution problems, as well as their successful promotion of fuel production with less adverse environmental impacts.

Future Government action proposals were submitted to the Prime Minister by meeting participants.

D. Ganbold, the Mongolian Mining Association’s head, said, “Local authorities have pressurized
economic entities to share water resources, but these authorities have decided that mining and exploration activities will not be allowed in water basins and river areas. This was a bad decision that has adversely impacted a number of mining companies that have spent less money to rehabilitate
their properties and water resources.”

Participants asked the PM to take measures to: improve the country’s mining sector standards; stop Government or local authorities from burdening companies with various taxes and inspections; and to put an end to the present regime that forces companies to apply to 15 Ministries for approval before establishing their operations.

Mongolia's National Chamber of Commerce and Industry's meeting venue

Monpolymetal Director Ts.Garanjav suggested adhering to a favorable tax policy so as to promote companies, increase jobs and encourage Mongolians abroad to return to their home country.

MCS advisor M. Chimed said, “Energy sector loses have increased to several billion Togrogs. It is now being claimed that electricity tariffs need to be increased by Tgs 90 per kilowatt, whereas, if the increase had been gradual over the years since 1998, we would today not have such ineffective financial conditions in the energy sector.”

The Energy Authority Chairperson, Ts. Bayarbaatar, confirmed that the Mineral Resources and Energy Ministry has planned to build power plants in the country’s western, central and eastern regions so that it will be no longer largely depend on energy being supplied by Russia.

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