#miningmongolia

Two weeks shy of  June 28th parliamentary elections, Sant Maral Foundation published its latest survey results. The results were collected from 1000 participants from four aimags (Sukhbaatar, Arkhangai, Selenge & Hovd) and Ulaanbaatar between the dates of June 6-June 14.

Aside survey questions regarding the important parliamentary seats (the results have the Democratic Party [Ардчилсан нам] gaining a plurality but not a majority), the report features responses regarding how much importance Mongolians place in democratic values, who their favorite politicians are, and how they rate what the socio-political issues in the country are (hints: most democratic values are important, former President Enkhbayar is more popular June than he was in April, and unemployment is atop Mongolians' list too).

Without lending any takeaways, miningMongolia.info maintains the results are still compelling. Anyone interested in how next week's election might play out are encouraged to check out the PDF linked in the heading. 

Previous plans about Tavan Tolgoi's consortium development appear to be put on hold as reports of a stalemate surfaced. 

According to a Reuters article this week, Erdenes-Tavan Tolgoi COO Graeme Hancock is quoted as saying that the current arrangement " is a very difficult group to put together in a consortium." 

As earlier reported, the consortium that was original slated to develop the estimated 7.5 billion ton coal mine included China's Shenhua Group, United States' Peabody Energy, and a Russian-Mongolian group. Amid cries from other prominent neighbors Korea and Japan, the plan was shelved to possible include new partners.  

Hancock was also quoted as saying "We've got a pretty good chance that [the deal] will never happen." 

In a Eurasianet piece, UB-based journalist Pearly Jacobs reflects on how tourism is being overshadowed by the recent fervor for mining in Mongolia. Presenting recent figures on how mining has eclipsed tourism in its contribution to Mongolia's economy, the author dwells on the irony that most foreign businessmen, Chinese entrepreneurs, and miners enter the country with tourist visas. 

While there is more than enough land for both mining and tourism to coexist, what is in short demand are skilled workers, airline capacity and an economic balance to fend off inflation. A director in the Ministry of Foreign Affairs, Stephan Kreppel posits that the area affected by mining is miniscule compared to the total landmass while at the same time mining-driven inflation will make Mongolia an increasingly expensive destination, and the “Minegolia” image could hurt the country's brand among potential tourists.

Jacobs also focuses on tour operators that are complacent with mining in the country and is hesitant to place blame on any one industry. While focusing on the importance of land in Mongolian society, the author quotes Gantemur Damba from Sustainable Tourism Development Center and reframes the challenge: 

"Mongolia is big enough [for both mining and tourism] at the moment, but with land-protection laws still weak, this can be easily reversed. What Mongolia requires is clear zoning policies where mining can develop and where locals have the right to retain land-use rights to preserve their [nomadic] heritage—the real tourism product of Mongolia."

During a diplomatic trip to Japan, Mongolian Prime Minister Sukhbaatar Batbold talked to reporters about the economy at large. Addressing clamor that Mongolia's rising inflation and out of control government spending will cause the economy to overheat, Batbold maintained tight monetary policy and budget discipline will sustain the country's wealth. 

Mongolia's GDP growth is only expected to rise more after a 17.3% surge last year. Putting these statistics side-by-side those that the Mongolian tugrik depreciated by 11% last year, Mongolia's natural resource fortune sets the stage for a possible bust. Given that there is a sizable mixture of domestic mining revenue and foreign direct investment, the government has a large pool of funds to draw from, along with the responsibility to provide improved services, mainly infrastructure.  World Bank figures report that government spending rose 56% last year and will rise again 32% this coming year.

Batbold also suggested that the upcoming deal on Tavan Tolgoi will not be worked out ahead of the June parliamentary election. A week after the announcement that portions of the Tavan Tolgoi IPO will be delayed, the drawn out process of picking consortiums to develop the Western block of TT is sharing a similar fate. 

Erdenes, the Mongolian state-run mining company, is pushing back the foreign listing portion of Tavan Tolgoi's Initial Public Offering. Original plans had the IPO slated to happen before June 2012. The upcoming parliamentary elections in June and candidate promises related to the use of IPO profits were the incentive for the speedy processing of the stock exchange listings. The IPO aims to be ready by September of this year. 

Mongolian government still aims to have the Ulaanbaatar Stock Exchange portion of the offering complete by Summer. However, London Stock Exchange and Hong Kong Stock Exchange listings are proving to be troublesome. HKEX does not include Mongolia among countries for which jurisdiction of listed companies exists. Mongolian parliament soon votes on a securities law measure that would allow Mongolian entities to enter the Hong Kong Market. London Stock Exchange will only handle the global depository receipts.

Featured above is a preview from a new documentary titled "Mongolia: Mining Challenges a Civilization". The project was directed by Ed Nef and put together by Santis Productions. 

The documentary is featured on this site for its different views on the impacts of mining. In addition to examining the lives of countryside herders, the documentary shows how life in the capital city of Ulaanbaatar has come to represent the future of Mongolia. Interviews gather insight from environmental advocates, mining directors (both Mongolian and foreign), as well as the current American ambassador, the Honorable Jonathan Addleton.

While not a news story proper, the linked story is a blog post from The New York Times. The story sets the stage for a cost-benefit analysis of mining Mongolia and takes a cue from a well circulated mass media article by The Economist earlier this month. Green, The New York Times' blog about energy and the environment, tries to explain the phenomenon of Mongolia and its 20%+ GDP growth rate projections.

Unique to this story is the incorporation of visual media. Two videos are featured and display conflicting views of mining life. 

The first video is from C.E.E Bankwatch Network and tells the story from the herdsmen's point of view. The conclusion of the research for the video prompts the viewer to take actions to stop such projects in Mongolia. 

The second video is from Mongolia Metal Holding LLC and is a corporate promotional tool. While there is a lot of technical information about iron ore, it is also makes the point to show how workers live in modern accommodations with healthcare and activities. The conclusion of the video points out how the global demand for minerals is working towards the benefit of Mongolia's economic growth. 

The story continues to balance sobering facts with uplifting ones. After citing an article that focuses on the dust that herders are incorporating into their diet and lifestyles as a result of mining, the author then cites from the same article figures that have the Oyu Tolgoi mine producing 200$ billion USD during its lifetime.