Push to draw Chinalco into Oyu Tolgoi project

The governments of China and Mongolia are discussing a potential labour agreement which, if finalised, will transfer 2500 Chinese to work for the copper-gold mining project Oyu Tolgoi in Mongolia, the 21st Century Business Herald reported yesterday.

A person involved in the talks, who was not named, said the earliest a decision about whether Chinalco could participate in the development of the Oyu Tolgoi project may come next month.

If the government labour agreement is signed, the person said in the report that the chance for Chinalco to take part in the project would be higher.

Chinalco is now an indirect participant of the mine because it has roughly 9 per cent stake in Rio Tinto, which has a 22.4 per cent stake in Ivanhoe, the operator of Oyu Tolgoi project — the largest under-developed gold-copper mine in the world.

Rio has an option to increase its stake in Ivanhoe to 46.6 per cent eventually. Ivanhoe Mines has increased the expected production from the $US4.6 billion ($5.1bn) Oyu Tolgoi copper and gold mine in Mongolia.

 

It puts average annual output from the South Gobi desert mine at 540,000 tonnes of copper and 670,000 ounces of gold over a 27-year life, with first production in 2013.

 

Ivanhoe executive chairman Robert Friedland has said the company expects these results will continue to improve to where Oyu Tolgoi will rank alongside Grasberg and Escondida.

 

Ivanhoe has appointed Citi to review its options, including debt or equity raisings, sale of subsidiaries, project financing or other corporate transactions.

   

Source: business-mongolia

SouthGobi to repurchase 2.5 million common shares

The Board of Directors of SouthGobi Resources has authorized a share repurchase program to purchase up to 2.5 million common shares of the company on each or either of the Toronto Stock Exchange and the Hong Kong Stock Exchange, in aggregate representing approximately up to 5 million common shares or 2.7% of the current outstanding common shares of the company. The share repurchase program will commence on June 15. The Board decided on the repurchase program “as the current market price may not reflect the underlying value of SouthGobi"s common shares”. The program is not expected to impact on SouthGobi"s growth plans.

Mongolia and China sign documents

The sides have inked some documents after the negotiations between Mongolia and the People's Republic of China. Firstly, the officials of the sides signed a Mongolia-China inter-governmental treaty on the Mongolia-China boundary regime and an inter-governmental agreement on the economic and technical cooperation.

 The countries also inked governmental exchange of notes on founding a street named after Beijing with money of a non-refundable aid rendered from China's government and inter-governmental protocols "On resuming and altering the agreement of mutual recognition of educational certificates and academic degrees", "On implementing the Mongolia-China inter-governmental agreement on cooperation in customs and mutual assistance, established September 7 of 1993" and an inter-governmental protocol on exchanging information between the General Customs Offices of Mongolia and the PRC.

 

Special loan agreements were inked between the countries for a sub-project of buying a locomotive in frames of the project on improving infrastructure of the railways' rolling stock to be financed with a soft loan of USD 300 million from the Chinese government, and for improving an infrastructure of Zamyn-Uud soum with this soft loan from China.

 

The bilateral final document is a mutual understanding memorandum between Mongolia's Nuclear Energy Agency and the PRC's National Nuclear Corporation on cooperation in the spheres of radioactive minerals and nuclear energy.

 

Source: Montsame

Mongolbank made request from the Government to refund “Anod” shareholders

Last week, Standing Committee on Economy held meeting and discussed three issues. First, to discuss the draft law on prohibiting issuance of exploration licenses, initiated by the President of Mongolia; MPs of Standing Committee voted for the draft laws to be discussed by the State Great Khural.  Second, Mongolbank and the Financial Regulatory Committee made a statement and proposed to the Standing Committee to refund Anod shareholders’ money 5.2 billion MNT. MPs of the Standing Committee reviewed the statement and suggested to made decision independently or to propose officially to the State Great Khural.  The last issue was on accredit of US$200 million by a former President of Mongolbank, MP O.Chuluunbat. Due to this non-secure accredit Mongolia would suffer notable loss. According to Mr. L.Purevdorj, President of Mongolbank, the legal sues are being held at two courts, one is in favour to the Mongolian side.   Source: business-mongolia

Mongolian mining companies to attend event at London Stock Exchange

The London Stock Exchange will hold a Mongolian Mining Companies’ Day on June 8. Northernsec is behind the event and its Director, B.Ulziibayar, gives more information on the planned day.

Why is such an event being organized?

We felt our domestic mining companies must be able to access investment and financing from foreign sources. Their needs for large amounts for long periods cannot be met from inside the country. The event will help bring them and investors together. 

How many companies have expressed interest?

We already have 20 confirmed registrations. 

How is the preparation work going?

Registration is being done in our company’s office in Ulaanbaatar. The London Stock Exchange is also active. The Ministry of Minerals and Energy, the Mineral Resources Authority and the foreign investment office have offered help and cooperation. 

What do companies have to do to participate?

There are no selection requirements as such. Companies which need visas should send their details of their company and project to info@northern-securities.com before May 21. Companies which don’t need visas can register in June, too. Interested companies can get further information from dialing 310-262.

Who first had the idea and how did the London Stock Exchange receive your proposal?

Last October we successfully organized a workshop in Ulaanbaatar on new ways of raising capital, in cooperation with the London Stock Exchange and the New York Mellon Bank. So the exchange already knew of the problems and the possibilities and favorably considered our proposal to organize a special day. We expect several international financial organizations to attend the event. They include J.P.Morgan, ING Bank, Citibank, Credit Suisse, Deutsche Bank, Bank of New York, Morgan Stanley and Nomura.

Northensec works as broker, dealer and underwriter and is a member of  the Mongolian Stock Exchange. It was established in 2007 and is offering new financial services in Mongolian stock market. It also facilitates Mongolian customers to trade on international stock market.

Source: http://www.news.mn