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Mongolia|business|September 10, 2016 / 01:37 PM
Mongolia plans to bring back to life long-delayed Tavan Tolgoi coal project

AKIPRESS.COM - Tavan Tolgoi coal mine Mongolia is planning to bring back to life the long-delayed and massive Tavan Tolgoi coal project in the south Gobi desert, as the land-locked country looks for ways to revive its ailing economy, according to Mining.com.

As a first step, Erdenes Tavan Tolgoi (ETT), the state-owned company that holds the license to the deposit, has already begun evaluating bids and calculating the potential economic benefits of reviving it.

"We are not ruling out any possibilities," Samdandobji Ashidmunkh, chief economic development officer of ETT, says. "If it's profitable for Erdenes Tavan Tolgoi and beneficial for the Mongolian economy, we're open to cooperate with anyone."

According to the Mongolian government, the country’s untapped mineral wealth is worth about $1.3 trillion.

Located in the South Gobi desert, Tavan Tolgoi is home to the world’s largest high-quality coking coal deposit used in steelmaking, with reserves estimated in 7.5 billion tons. However management of the operation has been characterized by bureaucratic bungling.

In 2011, Mongolia's National Security Council rejected a deal struck with U.S. giant Peabody Energy, China's Shenhua and a Russian-Mongolian, just two months after they were announced as winners.

The latest impasse came last year, when the Parliament blocked an agreement with a consortium of foreign firms, including China's Shenhua Energy, Japan's Sumitomo Corp. and Hong Kong-listed Mongolian Mining Corp. (MMC), which were interested in developing Tavan Tolgoi.

That group of companies, however, still hopes for a favorable resolution of the issue, and their offer is said to still be on the table. In the meantime, the newly established government is expected to honor investment agreements that support the development of Tavan, including building a power plant as a joint project with Japan's Marubeni, and deal with ETT’s outstanding debt to Chinese aluminum producer Chalco Group.

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