Ministry provides update on mining plans and current statistics

The Ministry of Mining (MM) reported that it expects Mongolia to extract around 131.4 million tons of coal each year on average until 2032 and export 94.9 million tons of coal each year. The amendment was made at Transparent Mining press conference on October 30.

The MM said that out of the amount of income expected to be drawn into the state budge from coal exports, only 53 percent has been collected. In total, the state budget has collected a revenue of 178.2 billion MNT this year.

The MM plans to increase coal exports to 30 million tons before the end of the year. The statistics show that Mongolia has exported only around 12 million tons of coal to China this year, which means that just over a million tons of coal were exported per month. The statistics date clearly indicate that Mongolia cannot reach its target by exporting 18 million tons of coal in the remaining two months of 2013, but Minister of Mining D.Gankhuyag claimed that it was posible.

Though Mongolia’s coal exports currently stand at 12 million tons, total extracted coal is around 20 million tons which means around eight million tons are ready for export. The MM officials also plan to repay the state owned coal miner, Erdenes Tavan Tolgoi’s 170 million USD debt to Aluminum Corporation of China Limited (CHALCO) from the coal export revenue derived from the eastern tsankhi (block) of the giant Tavan Tolgoi mine.

The coal extracted from the western tsankhi of TavanTolgoi isexported to CHALCO at the rate of 40 USD per ton, to repay Erdenes Tavan Tolgoi’s debt. At the current rate, the company cannot repay the debt by the end of this year, as planned.

Minister D.Gankhuyag also reported that Mongolia will export one billion tons of coal to China in the upcoming 20 years. He added that the ministry is not certain of the rates at which Mongolia will export coal but said that the trade transactions will be conducted on a monthly or quarterly basis. As part of the memorandum of understanding signed between Mongolia and China, Mongolia is to export 50 billion USD worth of coking coal and 20 billion USD worth of brown coal in upcoming 20 years.

Furthermore, the MM also reported a growth in the gold mining sector. Since January 1, 2013, revenue from gold extraction has exceeded estimations by 165 percent. Between January 1 and October 25, 6,985 kilograms of gold was mined in Mongolia according to MM.

D.Gankhuyag reported that the oil sector had a revenue of 116 billion MNT this year.

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