Key resources moves by Mongolia since 1990

ULAN BATOR, March 17 (Reuters) - Mongolia is moving gingerly to tap its huge mineral wealth, seeking to dispel fears of resource overdependence and dominance by powerful foreign miners, but its moves are not scaring off investors.

Here is a timeline of key investment decisions by Mongolia.

For a related analysis, click [ID:nSGE62E08P]

1990 - Mongolia opens the door to overseas companies after passing the Foreign Investment Law, granting mining firms five years of exemption from income-tax and guaranteeing a stable investment environment. Previous foreign investment had come exclusively from the Soviet Union and its satellites.

1997 - Mongolia joins the World Trade Organisation.

1997 - Mongolia's parliament, the Great Hural, passes new Mineral Law to encourage foreign mining firms to invest in the development of Mongolian resources.

1998 - French nuclear giant Areva signs an agreement to explore for uranium in Mongolia. It held 36 uranium exploration licenses in the country by the end of last year.

2006 - Despite protests from foreign mining firms, the Great Hural amends the Mineral Law to impose a 68 percent windfall profit tax enabling the state to benefit from high copper and gold prices. Ivanhoe Mines and Rio Tinto say the new tax rates make it too difficult for them to invest in the $3 billion Oyu Tolgoi ("Turquoise Hill") copper-gold project.

March 2009 - The China National Nuclear Corporation (CNNC) buys Canadian miner Western Prospector, which owns the license for Mongolia's Gurvanbulag uranium deposit.

May 2009 - Russian mining company Altan Dornod Mongol sues the Mongolian government for $1 billion at the Frankfurt Court of International Arbitration, saying the windfall tax violates international law.

July 2009 - Mongolia establishes Nuclear Energy Law, stipulating that 51 percent of Mongolia's uranium deposits must be held by the state. The Great Hural also approves a resolution authorising the government to settle the Oyu Tolgoi project with Ivanhoe and Rio Tinto.

August 2009 - The Mongolian parliament finally repeals the 68 percent windfall profit tax, effective from Jan. 1, 2011, paving the way for a final agreement on Oyu Tolgoi.

October 2009 - The Mongolian government finally signed off on a deal with Ivanhoe and Rio Tinto to develop Oyu Tolgoi after six years of negotiations. The project is expected to boost world copper supplies by 2 percent. [ID:nSP495396]

Oct 2009 - Mongolia establishes state-owned nuclear firm MonAtom, which immediately embarks on talks with foreign nuclear firms, including CNNC, on setting up uranium joint ventures in Mongolia.

Oct 2009 - China's biggest oil firm, the China National Petroleum Corporation, plans to spend $500 million to drill in Mongolia, government officials say. [ID:nPEK192788]

Oct 2009 - China's sovereign wealth fund, the China Investment Corp, invests $500 million in South Gobi Energy Resources SGQ.V to further develop coal projects in Mongolia, including Ovoot Tolgoi, which is expected to produce 8 million tonnes of coal a year within three to five years. CIC also revealed plans to invest $700 million in Iron Mining International, the owner and operator of a Mongolian iron ore mine.

Feb 2010 - Mongolian Prime Minister Sukhbaatariin Batbold says the government is planning to cancel an auction for a $2 billion stake in the world's largest untapped coking coal mine at Tavan Tolgoi, which had attracted the attention of BHP Billiton, Jindal, Vale, Peabody, China's Shenhua as well as a number of consortia from South Korea, Japan and Russia.

March 2010 - China's leading coal producer, Shenhua Group, says it is still bidding to invest in Tavan Tolgoi. [ID:nTOE62F01Q] (Reporting by David Stanway; Editing by Clarence Fernandez)

Source:Reuters news agency


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