The Infrastructure Stumbling Block
Mongolia’s infrastructure was a key point of discussion at the conference, with a lack in transport, mining equipment and water technologies being offered up as prime investment ventures in a country critically under resourced.
Talks explored the issues and proposed solutions in infrastructure, centering particularly on the role of railroads and Mongolia’s proximity to Russia.
“Any mining operation must have good railways” said B.Enkbaatar, Director of Mining Infrastructure investment at World Bank, “any mining operation must have good railways”
Many of Mongolia’s railways are outdated, not only is the overall rail coverage poor, but the tracks themselves are insufficient. Most were built in the Soviet period, and engineers at the time didn’t for see Mongolia’s massive mineral export potential.
Gauge size is part of the problems associated with the country’s railways, an it was heavily discussed at the conference. Plans for a common gauge between Mongolia and China are subject to government approval at the moment. Aside from the gauges being inconsistent with neighbor and prime export target, China, they are also not equipped to carry the sheer weight of coal that they will see in the hear future.
“When the Mongolian Government was making initial calculations on its railways they knew they would need a network that went cross country and over the borders” said Enkbaatar, “though they didn’t take into account the sheer weight of haulage that the tracks would undergo.”
In 2011, Tavan Tolgoi, considered to be one of the world’s largest untapped sources of coking coal, extracted around 20 million tons , however, estimates from Mongolia's National Mining Association and Tavan Tolgoi itself put that number up to 60-70 million tons in 2015.
Up to this point, exporting coal at the Chinese border has posed a serious problem for the mine, which is only 300 kilometers from the nearest crossing. “Due to a bottle neck at the border we didn’t reach our 1million ton export target last year” said TT CEO B.Enebish. While Trade and Development Bank CEO Randolph Koppa said “A railroad from Tavan Tolgoi to the border is one of most immediate needs.”
A lack of Chinese involvement was also cited by speakers as being a primary issue in transport proposals. “Transport in China is a hazardous variable” said Koppa, “they won’t start construction until it comes from our side.” Plans to build a bridging port have been stagnant recently and the variable cost of transport in China was also recognized as being a hazard.
While most acknowledged the rail system needed improvements, power sources were viewed as less of a problem in terms of of infrastructure. “power stations in the Gobi are underway so thats not a problem” said B. Enkbaatar. However water transport infrastructure still seemed to be an issue of development. “a resolution on water supply is an immediate issue”
Enkbaatar outlined a proposed upgrade in water transport infrastructure that would see a 630km water pipe from Hangai to the Gobi, buried four meters under the ground. Results from a Tolgoi feasibility study on the project will be released in July.
He finished by saying that infrastructure investment has been leaning toward the private sector, and that “the state is lagging behind.”
Talks explored the issues and proposed solutions in infrastructure, centering particularly on the role of railroads and Mongolia’s proximity to Russia.
“Any mining operation must have good railways” said B.Enkbaatar, Director of Mining Infrastructure investment at World Bank, “any mining operation must have good railways”
Many of Mongolia’s railways are outdated, not only is the overall rail coverage poor, but the tracks themselves are insufficient. Most were built in the Soviet period, and engineers at the time didn’t for see Mongolia’s massive mineral export potential.
Gauge size is part of the problems associated with the country’s railways, an it was heavily discussed at the conference. Plans for a common gauge between Mongolia and China are subject to government approval at the moment. Aside from the gauges being inconsistent with neighbor and prime export target, China, they are also not equipped to carry the sheer weight of coal that they will see in the hear future.
“When the Mongolian Government was making initial calculations on its railways they knew they would need a network that went cross country and over the borders” said Enkbaatar, “though they didn’t take into account the sheer weight of haulage that the tracks would undergo.”
In 2011, Tavan Tolgoi, considered to be one of the world’s largest untapped sources of coking coal, extracted around 20 million tons , however, estimates from Mongolia's National Mining Association and Tavan Tolgoi itself put that number up to 60-70 million tons in 2015.
Up to this point, exporting coal at the Chinese border has posed a serious problem for the mine, which is only 300 kilometers from the nearest crossing. “Due to a bottle neck at the border we didn’t reach our 1million ton export target last year” said TT CEO B.Enebish. While Trade and Development Bank CEO Randolph Koppa said “A railroad from Tavan Tolgoi to the border is one of most immediate needs.”
A lack of Chinese involvement was also cited by speakers as being a primary issue in transport proposals. “Transport in China is a hazardous variable” said Koppa, “they won’t start construction until it comes from our side.” Plans to build a bridging port have been stagnant recently and the variable cost of transport in China was also recognized as being a hazard.
While most acknowledged the rail system needed improvements, power sources were viewed as less of a problem in terms of of infrastructure. “power stations in the Gobi are underway so thats not a problem” said B. Enkbaatar. However water transport infrastructure still seemed to be an issue of development. “a resolution on water supply is an immediate issue”
Enkbaatar outlined a proposed upgrade in water transport infrastructure that would see a 630km water pipe from Hangai to the Gobi, buried four meters under the ground. Results from a Tolgoi feasibility study on the project will be released in July.
He finished by saying that infrastructure investment has been leaning toward the private sector, and that “the state is lagging behind.”
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