Multi-nationals seek Mongolian opportunities

Multi-national mining companies are increasingly taking an interest in Mongolia, a country endowed with substantial, untapped mineral wealth.

The Mongolian economy is growing at 7.5% a year, partly as a result of the strong global activity in the resources sector.

Investment from mining companies is bringing challenges to the country’s leadership, which is addressing the complexities of mining legislation whilst also developing a role as a new economy situated between the land masses of Russia and China.

Rio Tinto is heading a particularly significant project and seeking investment approval from the Mongolian government to develop what may become the world’s largest gold and copper mine.

Around one thousand workers are currently engaged in preliminary drilling in the $US2.7 billion project.

The cost of the proposed development is twice the annual budget of the Mongolian government and if the project fails to gain the approval of the current session of the Mongolian parliament, the potential for creating thousands of new jobs could be lost.

The Chinese government has recently provided a $US300 million loan to the Mongolian leadership.

This has been allocated to a hydro-power project, although no environmental or financial assessment of such a project has been published.