What is wrong with having two, three branch railroads?

Morning Must Reads-Review of Mongolian newspapers by MonInfo News Service

Next political upheaval on Tavan Tolgoi and related railroad shook Mongolia. Exploitation of Oyu Tolgoi and Tavan Tolgoi and other mineral deposits naturally draws issues of infrastructure development. Oyu Tolgoi investment agreement will be validated by April 6 of next year. However, it can be said Oyu Tolgoi " railcar" has moved. Oyu Tolgoi project people already said they will not rely much on railroad and can transport the products by motor roads.
This time railroad issue has been emerged in connection with Tavan Tolgoi.

Now we are talking of two options here.One is to build rail from Ukhaa Hudag (portion of Tavan Tolgoi deposit retained by Energy Resources) to Gashuun Sukhait border point. Another is to build rail from Tavan Tolgoi to main railroad through Sainshand and Dalanzadgad.

Last week's political upheaval targeted Energy Resources which plans to build narrow gauge rail road from Tavan Tolgoi to China through Gashuun Sukhait border point. I'm talking about emergence of public media campaigns which blamed ER for building rail that will put Mongolia under Chinese control and thus touched national security issue.
ER said why it becomes issue of national security when Mongolian owned company builds rail road to Gashuun Sukhait and why not when ships to Zamiin Uud.ER issued statement saying last weekend's media campaign (run on TV stations) attacking them is an organized effort against them and if need to, will disclose who is really behind the campaign.
When ER announced Press Conference yesterday, there was expectation that they are going to announce names of those people behind the campaign.However, they did not do this, instead, they talked about what they are doing in Tavan Tolgoi and justification for building rail directly to China.

ER was given special permit to build rail in June of 2008 signed by then PM Bayar and Minister of Infrastructure, Raash. This strategic issue was discussed by National Security Council and then President Enkhbayat was against this idea. However, the council did not reach a decision and the issue was put aside with comment" this needs to be discussed further by the council and Great Khural".

Battulga, minister of Urban Planning and Road, Transportation raised this issue again and expressed opinion this needs to be discussed again by the council. Expanded meeting of the council debated this issue again and however, no decision was taken. Great Khural is expected to debate this soon.

It is 240 km to Gashuun Sukhait from Tavan Tolgoi. Of course, it will be less costly to transport coal through this route. Another route or build rail to Dalanzadgad and Sainshand and connect to existing main rail will open up opportunities to export to other countries like Russia besides China.

ER said during yesterday's press conference they support the other route to Sainshand as well. Building railroads in two directions will benefit Mongolia they said. Building of railroad to Gashuun Sukhait already started as permits were already given. There is suspicion why ER was given the permit without bids. Most likely government gave the permit to ER for license of Tavan Tolgoi.

Everybody understands Sainshand project will benefit Mongolia more in the long run. However, now it is only on the paper.What are future scenarios for this development? What if the council decides building direct rail to China harming national interest of Mongolia and stops the building of rail?
What if ER rail project is allowed to continue and Sainshand rail project gets "stuck"? If parliament supports ER rail project, there is concern that nobody will support the Sainshand rail project and it will go nowhere.

How about supporting both projects?

By A.Altantuya, columnist of "Ardiin Erkh" (People's Right) newspaper


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