▲ Up
12:23 24-09-2018
АКИpress CA-News Tazabek Turmush
People to flood back into Mongolia for exploration, no one questioning geology and prospectivity: Investor
Central Asia | analysis | 14:12, 04 May 2016 | 2995

AKIPRESS.COM - exploration works Xanadu Mines chief executive Andrew Stewart used to need 15 hours to drive to his flagship Kharmagtai exploration site in Mongolia's South Gobi desert.

These days it takes the Australian geologist just five hours, thanks to the paved road that now exists to service Rio Tinto's nearby Oyu Tolgoi copper project, according to The Sydney Morning Herald.

Such are the benefits of exploring for copper and gold in the shadow of a multibillion-dollar mining operation.

That shadow could grow larger in coming days, amid growing speculation that Rio will shortly confirm plans to spend close to US$5 billion expanding Oyu Tolgoi.

Approval of the expansion has been keenly awaited by Australian companies working in Mongolia, and is expected to dramatically improve investor sentiment toward the land-locked Asian nation.

Stewart will be happy to see the expansion approved but says he doesn't expect a return to the feverish days of five years ago, when Mongolia was lovingly termed "Mine-golia" and "Mon-coal-ia" by excited investors.

"I am sure you are going to see people try and flood back into Mongolia for exploration, because no one is questioning the geology and the prospectivity. It is the most sparsely populated country in the world, it has a young motivated workforce, and you are on the doorstep of the world's biggest market," he said, in reference to Mongolia's shared border with China.

"But I think it will be a lot more measured.

"The projects are not there to get feverish about. You get feverish about the opportunity to discover more, but that is quite a long story.

"There has been very little exploration... so it is going to have to go into real grassroots exploration."

In truth, attitudes toward Mongolia have already shifted from the fears about sovereign risk that dominated sentiment just two years ago.

Stewart points to the 20 international banks that in December agreed to lend US$4.4 billion to Rio for the Oyu Tolgoi expansion as an important moment for sophisticated investors.

Shares in Xanadu have already risen from ¢7.5 in September to ¢24 this week, and Stewart hopes that some fresh discoveries will boost that further.

Xanadu already has some promising resources on its tenements, which were purchased from the same Rio subsidiary that owns Oyu Tolgoi: Turquoise Hill Resources.

Stewart worked for Turquoise Hill's predecessor in the large drill team that made the Hugo Dummett discovery that transformed Oyu Tolgoi from a promising province to a major find.

He recalls how that discovery pulled drill rigs away from the tenements that Xanadu is now exploring.

"It was really the discovery of Hugo that saw the concentration of drilling move to Oyu Tolgoi," he said.

Stewart's team will drill 6,000 meters of exploration holes in 2016, and are hoping to find the final piece of the Kharmagtai puzzle.

"It is not one particular deposit that makes it, it is generally a series or a cluster of different deposits," he said.

"Oyu Tolgoi is four deposits; we have found three deposits, we are looking for that fourth center, and we believe discovery of that fourth center will get the project to that next level, and that is what the exploration focus is on at the moment."

Related news:

Xanadu Mines trenches bonanza gold from Oyut Ulaan in Mongolia

12:11 Tanzania ferry death toll rises to 224, ship's managers detained11:45 Disaster risk reduction campaign held in Chui region11:31 Kazakh citizen detained for attempt to smuggle endangered falcons to UAE11:26 Almaty and Ulaanbaatar in the list of most dangerous cities in the world11:15 Foreign direct investments in the first 6 months of 2018 decreased by 24.9%11:07 Turkmenistan president to miss CIS summit in Dushanbe10:56 Turkmenistan president condemns terrorism after Iran military parade attack10:43 Nazarbayev condoles with Vietnam over president's death10:38 Japan's METI delegation and Turkmen diplomats discuss cooperation10:35 Industrial output growth projected at 3.2% in 201910:33 Tajikistan, UN discuss cooperation in security, sustainable development10:26 Minister of Foreign Affairs of Tajikistan meets with UN Secretary-General Antonio Guterres in NYC10:25 Kyrgyzstan produces minerals for 9.6 billion soms in 8 months10:00 US tells Iran to 'look in the mirror' after Rouhani blames it for Ahvaz attack09:53 Ashgabat expresses 'misunderstanding' over statement of Tajik Ambassador on suspension of Turkmenistan- Afghanistan-Tajikistan railroad construction09:50 Kazakhstan to conduct its first ever chemical castration of pedophile09:38 U.S. government donates food products to Talas health and social institutions09:35 Bishkek hosts international half-marathon on occasion of 90th anniversary of Chingiz Aitmatov09:29 Kyrgyzstan received $17.7m from export of electricity to Uzbekistan09:07 First deputy chief of Government's staff appointed
© AKIpress News Agency - 2001-2018. All rights reserved
Republication of any material is prohibited without a written agreement with AKIpress News Agency. Any citation must be accompanied by a hyperlink to akipress.com.
Our address:
Moskovskaya str. 189, Bishkek, the Kyrgyz Republic
e-mail: english@akipress.org, akipressenglish@gmail.com;
Tel/Fax: +996(312)65-03-06