Finance Minister explains proposed graduated royalty rates

The Government yesterday decided that a bill to amend the Law on Mineral Resources should be submitted to Parliament for approval. The draft proposes graduated royalty rates to replace the 68 percent windfall tax. Minister for Finance S.Bayartsogt explained the provisions in the draft to media and then answered questions.

The draft was prepared after considering suggestions from the Mongolian National Mining Association and entrepreneurs and companies operating in the mining sector. Not all of these were accepted.

What does the Government want?

The Finance Ministry studied many types of taxes and then formulated the present draft. There will be a basic five percent royalty fees on every mineral commodity. This will be raised by one percent, up to a maximum of 5%, as commodity prices increase. When a ton of copper ore costs USD 5,000 or less, the royalty payable will be the basic 5 percent. When the price reaches USD 6,000, the royalty will become six percent. Rising gradually, the royalty will be 10% when prices exceed USD9,000.

As for gold, the basic rate will apply until price per ounce is below USD 900. It becomes six percent when the price reaches USD1,000, seven percent at USD1,100, eight percent at USD1,200 and 10 percent if the price exceeds USD1,200.

For zinc it will be 5 percent for below USD 2,000, 6 percent at USD2,500, 7 percent at USD 3,000, 8 percent at USD 3,500 and so on.

Royalty on molybdenum will be 6 percent when the price per ton is USD40,000, 7 percent when USD45,000, 8 percent when USD50,000, 9 percent when USD55,000, and 10 percent when it crosses USD 55,000.

Coal will be in two groups - raw and processed. In the case of the first, royalty will be 5 percent when the price is USD 25 per ton, six percent when USD35 per ton, 7 percent when USD 45, 8 percent when USD 55, 9 percent when USD65 and 10 percent if the prices exceeds USD65 per ton. As for coked coal, it will be 5 percent for price below USD100 per ton, 6 percent for USD130, 7 percent for USD160, 8 percent for USD190, 9 percent for USD210 and 10 percent if the price is above USD 210.

He said the royalty graduation will not affect the Oyutolgoi mine

Elbegdorj, Wen Jiabao stress economic cooperation

President Ts. Elbegdorj’s talks with Chinese Premier Wen Jiabao in Beijing focused on greater economic and trade cooperation between the neighboring countries. Premier Wen said, "We should sign economic and trade agreements to lay a solid legal basis for bilateral cooperation," especially on major industrial projects.

China and Mongolia last year celebrated the 60th anniversary of establishment of diplomatic ties. Noting that the bilateral relationship has become more mature with the years, Wen said China and Mongolia share important common interests like safeguarding of northeast Asia"s stability and coping with the international financial crisis.

Elbegdorj thanked China"s support for Mongolia"s social and economic progress and reiterated Mongolia’s commitment to the one-China policy. He said Mongolia welcomes China’s contribution to its economic development and hoped for more cooperation in transportation, processing of minerals and animal products, and disaster prevention. The Mongolian President extended his sympathies to the people hit by the quake-hit Yushu area.

Earlier on Wednesday, Elbegdorj attended a meeting of the China-Mongolia Business Forum where over 200 delegates representing Mongolian and Chinese business participated. China has been Mongolia"s largest trade partner for 11 years, Elbegdorj noted. In 2009, trade between the countries reached USD1.92 billions.

This is Elbegdorj’s first visit to China since he took office in May 2009. 


Mongolia, South Korea to build waste recycle plant in Ulan Bator

ULAN BATOR, Apr. 24, 2010 (Xinhua News Agency) -- Mongolia and the Republic of Korea on Saturday signed a cooperation agreement to build a waste recycling plant in the Mongolian capital city.

The cooperating parties are the Ulan Bator municipal administration and the Korea International Cooperation Agency, according to the city's administrative office.

The waste recycling plant, to be completed in 2011 at a cost of 3.5 million U.S. dollars, will sort out, recycle and burn combustible wastes to generate power.

The plant will be located in the suburbs of Ulan Bator.

Municipal authorities have conducted feasibility studies for the construction of a waste recycling plant in the city, which has a population of just over 1 million.

Ulan Bator, founded in 1639, has since become Mongolia's financial, industrial and cultural center, with the country's manufacturers clustered in it.

Source:Xinhua News Agency of PRC

Mongolian FM Here

Pyongyang, April 20 (KCNA) -- Gombojab Zandanshatar, minister of Foreign Affairs and Trade of Mongolia, and his party arrived here on Tuesday.

They were greeted at the airport by Pak Kil Yon, vice-minister of Foreign Affairs of the DPRK, and Sodovjamts Khurelbaatar, Mongolian ambassador to the DPRK.


Pak Ui Chun Meets Mongolian FM

Pyongyang, April 20 (KCNA) -- Talks between Pak Ui Chun, minister of Foreign Affairs of the DPRK, and Gombojab Zandanshatar, minister of Foreign Affairs and Trade of Mongolia, took place at the Mansudae Assembly Hall on Tuesday.

Present there from the DPRK side were Ri Sok Chol, vice-minister of Agriculture, Kim Kyu Rak, vice-minister of Fisheries, and other officials concerned and from the Mongolian side the party of the minister of Foreign Affairs and Trade and Sodovjamts Khurelbaatar, Mongolian ambassador to the DPRK.

At the talks the two sides informed each other of the situations in their countries and exchanged views on the issue of boosting the friendly relations between the two countries and matters of mutual concern.


Zandanshatar Gombojav, Minister of Foreign Affairs to visit North Norea

Zandanshatar Gombojav, Mongolian Minister of Foreign Affairs to visit North Korea between 20-22 April according to invitation of Pak Il Chun, North Korean Foreign Minister, announced Press service of the Ministry of Foreign Affairs this morning.

The Minister to meet Kim Yon Nam, chairman of Presidium of People’s Assembly of Democratic People’s Republic of Korea and Choi De Bog, chairman of the People’s Assembly and his counterpart of North Korea.

During the visit, the parties plan to assess current relationship of the two countries and exchange opinion on expanding current trade, economic, agricultural and cultural relationship and issues concerning regional security.

Within the framework of improving economic aspect of foreign relationship, the Mongolian delegation will visit Rasen, special city of North Korea and familiarize with activities of Rajin, ocean port and exchange opinion about cooperation in this field with the Korean side.
During the visit, Minister Zandanshatar to hand out 5 tons of meat, first batch of Mongolian assistance for North Korean people.

Mongolian Delegation includes Enkhbold Zandaakhuu, Chairman of parliamentary standing committee on security and foreign relationship and Ochirbat, head of the Mongolia-DPRK parliamentary group and about 40 business enterpreuners.

By Battsetseg, reporter of MonInfo News Service

Cash-for-Work Carcass Clean-up launched in Mongolia

15 April, Ulaanbaatar, Mongolia – Herders began the enormous task today of burying millions of livestock carcasses in the three aimags that were severely affected by harsh winter conditions. With support from the UN Development Programme (UNDP), the herders are now part of a Cash-for-Work programme which provides them with immediate income while also reducing health risks by burying carcasses and preventing water contamination.
With technical assistance of the National Emergency Management Agency (NEMA), the herders are removing and burying up to two million livestock carcasses. This accounts for roughly 30 percent of all the animals that perished. Their income in total will be enough to stock flour and rice for three months of consumption for an average household.
“Now that the thaw has begun in Mongolia, the time is right for the herders to begin the carcass clean-up. We want to help small herders and women, who are most dramatically affected by Dzud, in the short term by providing immediate work opportunities, but we also want to work with them in the longer-term to find alternative means of livelihoods,” says Akbar Usmani, UNDP Resident Representative in Mongolia.
The programme is now underway in the most seriously affected three aimags of Uvurkhangai, Dundgobi and Khovd. UNDP in close cooperation with NEMA and local authorities plans to reach 20,000 herders, which is 60 percent of all herder households in the three aimags. Priority will be given to herders with under 200 head of livestock, households headed by women and other vulnerable groups that fall below poverty line.

UNDP attaches importance to transparency and equal participation in the cash-for-work programme. Soum government will announce a list of participants, and also beneficiaries on the Governor’s office board. For the longer term, UNDP will continue to work in three target provinces by providing opportunities to create alternative income sources. These will be based on local needs assessments carried out in collaboration with the National Chamber of Commerce and Industry to help herders establish and run small businesses.

Mongolia gets ADB support for herder

Herder lands have been buried in deep snow since early winter
On April 12, the Asian Development Bank in Manila, Philippines announced that they will provide $2.5 million in financial aid for isolated nomadic herder families, struggling to survive amidst an unfolding natural disaster, in Mongolia.
A financial grant to the Mongolian government from the ‘Asia Pacific Disaster Response Fund’ will help deliver food, fuel, and health and social services to herders battling heavy snow and abnormally low temperatures that have affected the country since last December. The brutal winter conditions follow a severe summer drought and shortage of animal fodder, resulting in a local natural disaster know as a dzud. . “ADB is committed to helping herder families affected by the dzud through this very difficult time,” said ADB President Haruhiko Kuroda. The government has declared a state of disaster in 15 of the country’s 21 provinces, with over 420,000 people - or a quarter of the rural population - affected by the severe conditions. Nomadic herder families, including pregnant women, have exhausted their food and cooking fuel, and in many cases have lost most of their livestock - the main source of livelihood for up to a third of the country’s population. Forced to fend for themselves, families have also been unable to access medical care and other social support services.

Livestock deaths reached 5 million by the end of March, and along with the potential for increased herder poverty, unemployment, and mass urban migration as a result, the large number of carcasses pose an infectious diseases threat as temperatures rise and the snow thaws.
Part of ADB’s assistance will also be used to remove dead animals in order to contain any risk of disease, and to avoid soil contamination.
The United Nations Resident Coordinator in Mongolia is overseeing disaster relief with assistance already extended from international nongovernmental organizations and development organizations. Bilateral emergency relief is being provided by countries such as People’s Republic of China, Russia and Turkey. The Asia Pacific Disaster Response Fund, established in 2009, provides quick disbursing grants to developing member countries affected by natural calamities. It is designed to help countries meet their immediate expenses, and helps bridge the gap between ADB financing facilities that reduce disaster risks, and those that provide longer term post-disaster reconstruction assistance.

Hunger protest forced to cease

Compromise hasn't deterred these protesters from starving themselves
The hunger protest by 7 citizens on Sukhbaatar Square was forced to cease when they were taken to hospitals for necessary treatment by policemen around 11:30 pm, on April 14.
The People’s Union to Demand Promise started its hunger protest on 09 April, demanding a referendum on whether voters are confident in the current Parliament or not. The hunger protest was announced
by seven people; head of PUDP D. Battsogt, general coordinator of PUDP G. Uyanga, head of ‘My Mongolian Earth’ Movement P. Bold, head of ‘Undesnii Soyombo’ Movement B. Lkhagvajav, head of ‘Undesnii Khas’ Movement D. Nanjid, as well as individuals D. Ganbaatar and D. Ninj. Medical doctors at the Sukhbaatar District Hospital were monitoring the health condition of the hunger protesters. In accordance with a request by the medical doctors, the Governor of Sukhbaatar District made a decision to involve the protestors in compulsory treatment to halt the increasing risk that would complicate the health state of the protestors.
Policemen took the hunger protestors to different hospitals, broke up over 30 people that were protesting by sitting on Sukhbaatar Square, and took away their ger. Supporters reported to the press that the hunger protestors were carried by force and results of their medical test were not so bad. However, Municipal Police Department chief S. Baatarjav denied it saying, PUDP received permission to organize a sitting protest from April 5-8, but they broke the law by exceeding the days of protest. For the  purpose of protecting the lives and  health of these people, 200 policemen took the hunger protestors without any force to hospitals. On the other side, the protestors did not show any disapproval.”
Prior the event the hunger protestors claimed that they would continue their position to protest and ompromise this matter only when Parliament releases a decision to conduct the referendum.
On April 12, President Elbegdorj met with Parliament Speaker D.Demberel, Parliament’s MPRP Group Leader D. Lundeejantsan, Parliament’s Democratic Party Group Deputy Leader L. Gamtumur and Chairman of State Institutions Standing Committee U. Enkhtuvshin and gave directives regarding certain issues. The President expressed his position that it would be appropriate for Parliamentary representatives to meet with the striking citizens on Sukhbaatar Square. The President also said, “The demands from these people are closely related to current legal and other actions facing the state. However, people need to refrain from political protest methods that are dangerous to their very lives, liberty and health. There are many ways people can express their opinions, enjoy the freedom of speech in a democratic country like Mongolia, and it is proper to solve any issues democratically through open negotiations.” The same day, advisors to the President met with the representatives of People’s Movement to Demand Promise who are on a strike on Sukhbaatar square. Human Rights and Public Participation Policy Advisor Ms. Sosormaa, recently appointed to this position, and Public Relations Adviser Mr. Ganbaatar met with the strikers to observe their health conditions, the environment for exercising human rights, and to discuss ways to resolve the related issues through meaningful negotiations.
On April 13, Parliament’s Legal Standing Committee chairman B. Bat-Erdene, Environment, Foods and Agriculture Standing Committee chairman B. Batbayar, MPs D. Dondog and P. Altangerel met with the hunger protestors at the State House. The MPs offered them to review their strict position to announce a hunger strike, carry out a referendum, and seek ways to resolve it by means of talks and understanding. B.Bat-Erdene said, “We responded to the demands you made to Parliament. We studied your demands to carry out a referendum in turn. It must be resolved within the frame of the law because it is a matter belonging to Parliament’s prerogative rights. Therefore, we consider your demand to carry out a referendum as
inappropriate. We Mongolians have a tradition to resolve any issue in a peaceful way. Thus, it is possible to avoid strict forms of protest that put your lives at risk and resolve the matter in conciliation.”
MP B. Batbayar expressed that he does not consider the referendum as a decisive step to tackle the matters and said, “It might cause instability and raise a complicated situation in political life or defame the State’s reputation. For this reason, we should look for different ways and forms to resolve it”. MP P. Altangerel said that the current legal system causes such problems to arise and working groups from two sides need to develop accurate talks in order to establish the right legal environment. D. Battsogt and G. Uyanga said that they were not for sitting in the parliament after dismissing the parliament and people talk much about mistakes of the parliament. “Because parliament did not accept our demand, we demand to resolve the disputable matters by conducting a referendum.” Head of the Radical Reform Movement D. Ganbaatar criticized the establishment of the Oyu Tolgoi Investment Agreement by breaking the law without hearing opinions of scientists and experts, as well as taking a backward step to social welfare policy and MPs violated laws themselves. They requested the MPs to grant Ghers (national dwelling) to 20 countryside people who are taking part in the protest and to give attention to the case of a man who crushed the protestors Gher by a car attack . MPs repeatedly requested them to stop this harsh form of protest which can negatively affect their lives and health conditions and resolve the matter by means of conciliation. MPs Z. Altai and S. Enkhbat and DP member J. Batzandan and O. Magnai who were former leaders of Civil Movement Party also met the protestors. ‘MONFEMNET’ NGO for Mongolian women sent a letter of demand to the City Governor and Ulaanbaatar Mayor G. Monkhbayar. The letter demands to take all required preventive measures for people who are struggling for founding equal political and social rights and just democratic governance, from deterioration of their health conditions, and foremost, provide people on hunger protest with a warm Gher and give medical services to those who are partaking in political sitting. Besides the civil movements, teachers and workers of health sectors recently organized demonstrations to demand a salary increase. On April 8, about 4,000 medical workers demonstrated in front of Health Ministry. They decided to demonstrate because they submitted their salaryraise issue to the Health Minister 6 times since October of 2009, but the issue have not been resolved. An issue to raise salaries and retirement pensions is in discussion at the Parliament. At the meeting of Parliament’s MPRP group they supported to increase salary and retirement pension in two stages, from July 1 and October 1 and to resolve it during the discussion of budget adjustment. Social Welfare and Labor Minister T. Gandi said, “The issue on how to raise people’s salary is being discussed in government. We are studying the capability of the budget. This issue should be discussed within the frame of the labor and social conciliation agreement. The main thing is to reach an understanding and agreement. Generally, Mongolia has over 1,000,040,000 people with working ability, of which only 16 percent work in state-run organizations. 84 percent work in the private sector. Therefore, we should study the capacity to raise salaries of not only state workers, but in the private sector as well. As the issue of a salary increase is discussed,we need to resolve it as a whole.

Adults can now receive Tgs70,000 from HDF

Starting April 15, adults over the age of 18 started receiving Tgs 70,000, as the first part of the political parties’ promise to allocate shares from the m i n e r a l s resources. Parliament made decision to distribute Tgs 120,000 to every citizen this year from the money accumulated in the Human Development Fund (HDF). On February 1, 2010, Tgs 70,000 was first disbursed to retired elders, disabled people and children under 18.
D. Nyamkhuu, Deputy Social Welfare and Labor Minister said that all preparation measures were completed such as depositing Tgs 60 billion from HDF to its accounts in aimags, districts and soums through the State Fund, receiving names of citizens above 18 who have no document contradictions from State Registrations Agency, providing aimags, districts and soums with name lists of people above 18.
The first wave of adults visit khoroo offices to register their claim

The City’s Welfare Office is registering homeless, vagrants and people who live in drainage holes and
issuing citizens ID documents in order to organize distributions to them. Shares for prisoners will be transferred to their banking accounts through the General Authority for Implementing Court Decisions and Mongolians staying abroad can receive the money with entrusted people by taking a reference letter from Mongolia’s Adults can now receive Tgs70,000 from HDF Hunger protest forced to cease diplomatic missions abroad.
As of April 1, 1,157,704 people received the share, meaning that 95 percent of children, disabled people and elders received their shares. During the distribution of the share, 78 people were found to have taken the money twice. While the loss was recovered from 22, the others were not found. The case was transferred to legal organizations.
On April 2, the Government resolved to issue Tg1.5 million to every citizen. To accomplish this, Tgs1 million will be delivered in the form of covering people’s retirement pension and health insurance premiums, issuing vouchers for education and health services and for the purchase of apartments, and Tgs500,000 will be given in cash in 2011-2012.
The Government plans to make the required estimations through asking every citizen who is receiving the HDF book to specify which form he wants to receive Tgs1.5 million
B. Ooluun.

Mongolia sends condolences to Poland

Mongolians express heartfelt sympathy for Poland’s tragic loss
On Tuesday, April 13, Mongolia’s Foreign Ministry organized a memorial gathering to extend deep sympathy to the families of Polish President, Lech Kaczynski, first Lady Maria Kaczynski, and high level state officials who died in a plane crash on April 10, 2010 near the Russian city of Smolensk. President Kaczynski, his wife,military chiefs and MPs were due to attend a memorial for the World War II Katyn massacre when their plane crashed near Smolensk, Russia. At the event, G. Zandanshatar MP, the Minister of Foreign Affairs of Mongolia; D. Ochirbat MP; D. Dorligjav, head of the Presidential Office; MPs including D. Dondog, head of Mongolia-Poland Parliamentary Group; authorities of the General Headquarters of Mongolia’s Armed Forces; heads of diplomatic missions; Mongolian alumni of Polish universities and institutes, and representation of various NGOs signed a book of condolence to extend deep sympathy to families and relatives of the people who died and to the Polish government and people.
The event was co-organized by the Embassy of Poland in Mongolia and Mongolia-Poland Friendship Society

Following this tragic plane crash,President Ts.Elbegdorj extended his condolences to the people of Poland for the loss of their President, Lech Kaczynski, his wife M. Kaczynsky, and a distinguished delegation of
Polish civilian and military leaders. The Letter of Condolences reads: “Dear Mr. Bronislaw Komorowski, Marshal of the Sejm of Poland, I am writing to you to extend my deepest condolences to you and to the people of Poland. I was deeply saddened by the news of the tragic accident today that took the lives of President Lech Kaczynski, First Lady M. Kaczynski and many other members of the Government of Poland. The late President, First Lady and many others who lost their lives in this tragic accident were friends to the people of Mongolia, and the people of Mongolia will always remember the contributions they made to develop the relations between Mongolia and Poland. To the people of Poland and to the families who lost their loved ones, I extend my deepest condolences on the behalf of the people of Mongolia, for the tragic loss suffered by the people of Poland.”
T. Baasansuren, Director General of the MONTSAME News Agency and former Monolian Ambassador to Poland, also sent a letter of condolence to his Polish counterpart Valerie Sivinski, Director General of the Poland News Agency (PAP) in which he expressed deep grief and sympathy to Poland and the Polish people over their great losses on behalf of all Mongolians.

Mongolia to donate meat to North Korea

During cabinet meeting last Wednesday, Government of Mongolia decided to donate 30 tons of meat to North Korea. According to press service of the Government of Mongolia, “ per request of DPRK, Government of Mongolia is assigning Badamjunai, Minister of Food, Agriculture and Light Industry and Zandanshatar Gombojav, Minister of Foreign Affairs and Trade to organize delivery of 15 tons of goat meat and 15 tons of mutton to North Korea.”

Government of Mongolia decided to allocate 80 million tugrig (approx $ 57,000 US) for purchase and delivery of the meat to North Korea.

By Battsetseg, reporter of MonInfo News Service

Mongolia to Develop Biggest Untapped Uranium Field With Russia

By Yuriy Humber

April 14 (Bloomberg) -- Mongolia will develop its biggest untapped uranium field in a venture with Russia after revoking Khan Resources Inc.’s permit to exploit the Dornod resource.

The Asian country’s state-owned KOO MonAtom will hold at least 51 percent in a venture with Russia’s government-run ARMZ Uranium Holding and possible partners from Japan or China, according to Mongolia’s Nuclear Energy Agency. Bayarbayasgalan Tudevbazar, nuclear materials chief at the agency, commented in an e-mailed response to questions on April 9.

Toronto-based Khan Resources said yesterday a unit had its Dornod license annulled after accusations it failed to deal with breaches of the law. The company denied any violations and said it would challenge the agency’s decision. Spokesman Jonathan Buick didn’t respond to e-mails seeking comment.

Development of some of the world’s largest untapped mineral resources has been delayed in Mongolia by political infighting and a lack of funds. The nation plans to set up companies to manage the resources and may sell shares to global investors, Prime Minister Sukhbaatar Batbold said in February.

The uranium venture, called Dornod Uranium, will be registered in Mongolia “in the very near future,” Tudevbazar said, confirming the cancellation of Khan’s license.

In November, ARMZ bid 65 Canadian cents a share for Khan, to see it trumped by China National Nuclear Corp. with a 96-cent offer this year. ARMZ let its offer lapse, Khan said in March.

--Editors: Tony Barrett, Simon Casey

To contact the reporter on this story: Yuriy Humber in Moscow at

To contact the editor responsible for this story: Simon Casey at

Source:Bloomberg news service

Khan Receives Notice of License Invalidations

TORONTO, ONTARIO, Apr 13, 2010 (MARKETWIRE via COMTEX) -- Khan Resources Inc. /quotes/comstock/11t!kri (CA:KRI 0.54, -0.31, -36.47%) ("Khan") announced today that its 58%-owned Mongolian joint venture subsidiary, Central Asian Uranium Company, LLC ("CAUC") and its 100%-owned Mongolian subsidiary, Khan Resources LLC ("Khan Mongolia") have received notice from the Mongolian Nuclear Energy Agency (the "NEA") stating that CAUC's mining license 237A (the "Mining License") and Khan Mongolia's exploration license 9282X (the "Exploration License") have been invalidated. The invalidations purport to be effective as of October 8, 2009 and purport to be based on a failure by CAUC and Khan to address violations of Mongolian law stemming from a July 2009 report issued by an inspection team appointed by the Mongolian State Specialized Inspection Agency (the "SSIA") in respect of the Mining License.

Khan continues to believe that it and its Mongolian subsidiaries have always operated and continue to operate in compliance with all applicable Mongolian laws, including the Nuclear Energy Law, and there is no legal basis for the NEA invalidation notices. Khan intends to challenge the NEA's actions through all legally available means. In Khan's view, the actions by the NEA are a clear violation of Khan's rights and interests under the laws of Mongolia, and are in breach of Mongolia's obligations under international law. Khan and its legal counsel intend to vigorously defend its rights and interests, and to pursue all available rights and remedies in the Canadian and Mongolian courts and, if necessary, in international arbitration.


Khan believes that in order to understand the latest action by the NEA, it is necessary to understand the background and recent history.

As previously announced by Khan, in July 2009 CAUC was informed by the Mineral Resources Authority of Mongolia ("MRAM") that the Mining License (and only the Mining License) had been temporarily suspended due to CAUC's alleged violation of applicable laws cited by inspectors from the SSIA based on their visit to the Dornod site in mid-April, 2009. The principal violation was that CAUC had not registered its deposit reserves with the State Integrated Registry for approval by the Minerals Professional Council. In fact, CAUC had submitted the deposit reserves and resource calculation for registration in 2007, but the Minerals Professional Council had never (and to this day has never) held the requisite meeting to consider the calculation and prepare the requisite report. Following receipt of such notice, CAUC met and communicated with SSIA representatives on several occasions and responded to each of the alleged violations cited by the SSIA and continued to work cooperatively to resolve any allegations surrounding the Mining License or CAUC's activities in Mongolia. CAUC also brought a legal action in Mongolia against MRAM challenging the temporary suspension. In January, 2010, CAUC reached a settlement with MRAM in which the temporary suspension was terminated, which was announced by Khan on January 14, 2010. Khan viewed this settlement as having finally resolved the July 2009 suspension of the Mining License.

Also in July 2009, the Government of Mongolia passed the new Nuclear Energy Law which became effective on August 15, 2010. Under the Nuclear Energy Law, all holders of uranium licenses were required to submit formal applications to re-register their licenses in compliance with the new legislation. On October 8, 2009, CAUC and Khan received notices (the "October 8 Notices") which stated that in connection with the implementation of the Nuclear Energy Law, the existing Mining License and Exploration License should be considered invalidated, and that CAUC and Khan should not undertake any activities under the licenses until they obtain new licenses from the NEA under the new law. Khan inquired as to the grounds and consequences of such invalidations, and was informed by the NEA that all licenses held by all uranium license holders in Mongolia had been temporarily suspended in October 2009, pending re-registration of such licenses under the Nuclear Energy Law. Accordingly, Khan interpreted the October 8 Notices as an administrative matter which meant only that its licenses, like those of all other license-holders in Mongolia, were in limbo pending re-registration under the new law. In November 2009, CAUC and Khan submitted lengthy and detailed applications for the re-registration of the Mining License and the Exploration License. The applications were in compliance with the requirements of the new legislation, including the requirement to state that the license holder accepted the ability of the Mongolian State to take an ownership interest in the license-holder without compensation. Although this expropriation provision of the Nuclear Energy Law has been challenged by the Mongolian Mining Association and others, Khan and CAUC made a decision to accept it and to work cooperatively with the Mongolian State-owned uranium company MonAtom LLC ("MonAtom") on a basis that gave MonAtom a 51% ownership interest in the entities that own the Mining License and Exploration License.

Indeed, on January 25, 2010, Khan announced that it had entered into a non-binding memorandum of understanding (the "MOU") with MonAtom, which sought to establish the principal elements of a joint venture transaction which would finalize the ownership structure surrounding the Dornod Uranium Project and create a framework for developing the project and bringing it into operation as expeditiously as possible. Among other things, the MOU contemplated MonAtom acquiring a 51% interest in each of CAUC and Khan Mongolia in accordance with the Nuclear Energy Law and also contemplated re-registration of the Mining License and the Exploration License within 7 days of signing the MOU. This latter condition to the MOU was never fulfilled and, accordingly, despite Khan's efforts to cooperate with the Government of Mongolia, the transactions contemplated under the MOU were not pursued further. Additional details concerning the MOU can be found in Khan's January 25, 2010 press release.

Despite the fact that the Nuclear Energy Law stipulates that exploration licenses must be re-issued within 3 months and mining licenses with 6-12 months, the license re-registrations of Khan are still pending. Khan has made repeated requests for an official update as to the status of these applications and its licenses, however, until now, Khan had not yet received any official response from the NEA.

The latest notices from the NEA came in response to Khan's latest attempt, in a letter dated April 9, 2010 to the NEA, to seek official confirmation as to the status of its licenses. Although Khan is aware of several news stories in the Mongolian and Russian press which have suggested that Khan's licenses had been annulled, this is the first time that Khan has received any official confirmation to this effect.

Indeed, as recently as March 29, 2010, representatives of CAUC and Khan met with a committee of the SSIA to discuss various renewed allegations of non-compliance identified by the SSIA subsequent to receiving the October 8 Notices based on another inspection conducted by the SSIA in March 2010, which Khan understood would form the basis of a future decision regarding the licenses. In several instances, the alleged violations had already been the subject of previous investigations by the SSIA and previously responded to. In any event, Khan believes that the alleged violations are not an appropriate or legal basis upon which the NEA could properly make a decision to invalidate the licenses or not to re-register them under the Nuclear Energy Law. At the end of these meetings with the SSIA committee, SSIA Chairman Sodbaatar indicated that further audit and inspection would be undertaken and, following a preparation of a report on the results of that further audit and inspection, only then would a decision, if any, be made with respect to the licenses by the SSIA. He also indicated that the matter may be elevated for discussion and consideration by higher-level Government authorities. Khan had not received any further communication from the Mongolian Government since the March 29 meeting with the SSIA, until now.

Khan finds the basis upon which the invalidation notices purport to be issued highly troubling. Notwithstanding the assurances received from the NEA in October 2009 that the October 8 Notices were common to all license holders and the suspensions were temporary in nature pending re-registration of licenses under the new law, the NEA is now, several months later, alleging that the October 2009 invalidations of the licenses were actually on the basis of the violations cited in the July 2009 SSIA report. This stated rationale is in direct contrast to the October 8 Notices themselves and to the assurances received at that time from the NEA as to the scope and purpose of the October 8 Notices. It is also in direct contrast to the inspection efforts of the SSIA, which were still ongoing as of March 29, 2010 and, Khan understands, continue to be ongoing.

Khan notes that rumours and allegations as to the status of its licenses in Mongolia have appeared in the Mongolian and Russian press and posted on various websites in Mongolia and Russia since late February. Indeed, when Atomredmetzoloto JSC ("ARMZ"), a subsidiary of the Russian state-owned nuclear energy company Rosatom, allowed its unsolicited take-over bid for Khan to expire on March 1, 2010 in the face of a superior bid from CNNC Overseas Uranium Holding Ltd., its stated reason for doing so was a report by a working group established by the Security and Foreign Policy Standing Committee of the Mongolian Parliament which recommended that a number of uranium exploration and mining licenses in the Dornod province should be invalidated based on alleged and unspecified violations of Mongolian law. Although Khan was not mentioned in this report, allegations that Khan's licenses had been annulled based on this report were repeated by Rosatom officials in the Russian media.

Martin Quick, President and CEO of Khan, said: "It is entirely unclear and completely non-sensical as to why the SSIA would continue to inspect the Dornod licenses and engage in communications and discussions with Khan and its subsidiaries concerning the Dornod licenses with a view to coming to a formal decision at some point in the future, if in fact that licenses were invalidated in October 2009, as the NEA now alleges." Mr. Quick added, "We view the NEA decision to invalidate the Dornod licenses as without any legitimate or legal foundation and may be politically motivated. The NEA's intention appears to be to invalidate our licenses, as well as potentially those held by other foreign companies operating in the region, with a view to transferring all of the mineral rights and interests in the entire Dornod uranium region to a 'Dornod Uranium joint venture' that is purportedly being established between the Russian and Mongolian Governments, with complete disregard to Khan's rights and interests."

Additional details regarding the background to the recent NEA actions are set out in more detail in Khan's directors' circular dated December 14, 2009 issued in response to the unsolicited take-over bid for Khan by ARMZ. The circular can be found at

As mentioned above, Khan intends to take all legally available steps to protect its interests, including by pursuing all available rights and remedies in the Canadian and Mongolian courts and, if necessary, international arbitration. Khan has instructed its legal counsel to immediately begin preparations for a legal challenge to NEA's actions.

Khan will provide further updates as information becomes available.

Khan Resources Inc. /quotes/comstock/11t!kri (CA:KRI 0.54, -0.31, -36.47%) is a Canadian company engaged in the acquisition, exploration and development of uranium properties. Its current activities are focused on the Dornod area in northeastern Mongolia, the site of a former Russian open-pit uranium mine. Khan holds interests in the Main Dornod Property and in the Additional Dornod Property. Khan's website is

Forward-Looking Statements and Information

This press release may contain forward-looking statements and forward-looking information, which are subject to certain risks, uncertainties and assumptions. Forward-looking statements and information are characterized by words such as "will", "plan", "expect", "project", "intend", "believe", "anticipate", "forecast", "schedule", "estimate" and similar expressions, or statements that certain events or conditions "may" or "will" occur. Forward-looking statements and information are not historical facts and are based upon a number of estimates and assumptions and are inherently subject to significant business, social, economic, political, regulatory, competitive and other risks and uncertainties, contingencies and other factors, including the impact of International, Mongolian and Canadian laws, trade agreements and regulatory requirements on the offer by CNNC Overseas Uranium Holding Ltd. ("CNNC") and Khan's business, properties, licenses, operations and capital structure, Khan's ability to re-register or re-instate the Dornod licenses, regulatory uncertainty and obtaining governmental and regulatory approvals for the offer by CNNC, legislative, political, social, regulatory and economic developments or changes in jurisdictions in which Khan and CNNC carry on business, the speculative nature of exploration and development, risks involved in the exploration, development and mining business, changes in market conditions, changes or disruptions in the securities markets and market fluctuations in prices for Khan securities, the existence of third parties interested in purchasing some or all of Khan's shares or assets, the satisfaction or waiver of the conditions to the CNNC offer, the extent to which holders of shares determine to tender their shares to the CNNC offer, the anticipated benefits of the CNNC offer, litigation and other legal proceedings, the method of funding and availability of potential alternative strategic transactions involving Khan, including those transactions that may produce superior strategic value to shareholders, the need to obtain and maintain licenses and permits and comply with national and international laws, regulations, treaties or other similar requirements, and uncertainty in the estimation of mineral reserves and resources.

In addition, a number of other factors could cause actual results to differ materially from the results discussed in such statements and information, and there is no assurance that actual results will be consistent with them. For further details, reference is made to the risk factors discussed or referred to in Khan's annual and interim management's discussion and analyses and Annual Information Form on file with the Canadian securities regulatory authorities and available on SEDAR at Such forward-looking statements and information are made or given as at the date of this news release, and Khan assumes no obligation to update or revise them, either publicly or otherwise, to reflect new events, information or circumstances, except as may be required under applicable securities law.

Khan Resources Inc.
Martin Quick
President & CEO

The Buick Group
Jonathan Buick
Office: 416.915.0915, Ext. 302
Toll Free: 1.877.748.0914

SOURCE: Khan Resources Inc.


Garrison Appoints Consep International Ltd. to Provide a Turnkey Gold Plant

TORONTO, ONTARIO, Apr 13, 2010 (MARKETWIRE via COMTEX) -- Garrison International Ltd. /quotes/comstock/11v!e:gau (CA:GAU 0.10, +0.01, +11.11%) ("Garrison") is pleased to announce that it has appointed Consep International Ltd. ("Consep") to establish a turnkey gold plant at Garrison's Tovshiir gold project in South Eastern Mongolia.

Consep is a world leader in the production of high-tech gold plants. The Consep edge revolves around producing a concentrate from ore that undergoes intensive cyanide leaching in a closed circuit system. As compared to most other approaches and technologies, Consep's patented 20 tonne per day closed cyanide-electrowin circuit uses a small quantity of chemicals.

Test work conducted to date using the Consep gravity - leach system on test ore from the Tovshiir project has produced overall gold recovery of 86%. Garrison's management is optimistic that similar recovery rates will be achieved when full-scale production commences at Tovshiir. Recoveries using the Consep system often reach as high as 95% at other similar operations, and Consep facilities are fully automated.

Procuring state-of-the-art, leading edge technology in clean gold processing equipment from Consep will enable Garrison to maintain greater control over all aspects of production, including by helping to minimize security risks during production, and reducing the potential risks to wildlife, livestock, local inhabitants and the surrounding environment. In addition, by employing such technology Garrison should be able to minimize cost fluctuations.

Using the Consep system, gold can be recovered from ore through a much cleaner system than would be the case with a conventional Carbon in Pulp Cyanide Plant. Since the Consep system does not use a leach pond and does not expose cyanide to the open environment, the risk of environmental contamination and the exposure of local inhabitants and livestock to hazardous substances is significantly reduced.

Consep is contracted to provide an automated screening plant, and an Acacia Intensive Leach Unit of 20 tonne per day capacity that has associated electrowin, solution recharge and detoxification units. All of these units are automated, they will be monitored from the plant's main control room and they will require only one skilled person to operate the process, thereby helping to control costs.

Management of Garrison anticipates that the Consep plant should arrive for installation at the Tovshiir site during the 3rd quarter of Garrison's 2010 financial year.

About Garrison

Garrison is a junior mineral exploration company focused on acquiring and developing advanced stage gold properties in Mongolia. For complete details on Garrison International Ltd. and its partners, management encourages investors and interested parties to view its public documents filed on SEDAR at

For all Garrison International Ltd. investor relations needs, investors are asked to visit the Garrison International IR Hub at where they can post questions and receive answers within the same day, or simply review questions and answers posted by other investors. Alternatively, investors are able to e-mail all questions and correspondence to where they can also request to be added to the investor e-mail list to receive all future press releases and updates in real time.


No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein. All statements in this news release, other than statements of historical fact, are forward-looking statements that involve various risks and uncertainties, including, without limitation, statements regarding the future plans and objectives of Garrison International Ltd. There can be no assurance that such statements will prove to be accurate. Actual results and future events could differ materially from those anticipated in such statements. These and all subsequent written and oral forward-looking statements are based on the estimates and opinions of management on the dates they are made and are expressly qualified in their entirety by this notice. Garrison International Ltd. assumes no obligation to update forward-looking statements should circumstances or management's estimates or opinions change.

Shares Outstanding - 97,738,057

Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.

Garrison International Ltd.
Blair Krueger
President & CEO
(416) 524-8150

SOURCE: Garrison International Ltd.


Khan Resources says Mongolia cancels units' licenses

* Nuclear agency invalidates mining, exploration licenses
* Khan to challenge decision in court
* Shares sink 40 pct (Recasts; adds details, CEO comment, updates share movement)

By Ashutosh Joshi

BANGALORE, April 13 (Reuters) - Khan Resources Inc (KRI.TO) said Mongolia's Nuclear Energy Agency (NEA) invalidated the mining and exploration licenses of two of its units citing certain violations, sending its shares down 40 percent, their largest ever fall on a single day.

The Canadian explorer, which has been facing trouble from the Mongolian authorities with regard to its uranium projects in the country, said it intends to challenge the decision through all legally available means, including international arbitration.

Khan, which has agreed to be bought out by a unit of China National Nuclear Corp (CNNC), said the Mongolian agency invalidated the mining license of Central Asian Uranium Company LLC (CAUC) -- which holds a 58 percent share of the Dornod uranium deposit in Mongolia, where Russian and Mongolian state concerns each hold a 21 percent stake.

Toronto, Ontario-based Khan, which in December rejected an offer from the Russian uranium concern AtomRedMetZoloto (ARMZ), also had the exploration license of its fully owned unit, Khan Mongolia, invalidated, with effect from Oct. 8.

"The fact that we have found a Chinese partner has probably upset the Russians and we think the Russians are putting a lot of political pressure on the Mongolians," Khan Resources Chief Executive Martin Quick said by phone.

The NEA Website said it had not renewed the licenses and had intimated Khan Resources and CNNC on its decision.

Under Mongolia's nuclear energy law, the NEA has power to invalidate licenses, if companies holding such licenses fail to tell the regulator about changes in their ownership structures within a stipulated time, the NEA said in a statement.

It was not immediately clear if Khan and CNNC had submitted to the NEA the details of the ongoing takeover deal, which is expected to be completed by the end of May.

CEO Quick said the company was looking to change its ownership structure to comply with the law.

He said the NEA canceled the licenses on the grounds that the company did not register its deposit reserves with a committee of the Mongolian government.

"We've had our reserves submitted to them now for the last two years and have been waiting for them to meet and approve," Quick said.


Dornod, a deposit once explored by Soviet geologists, has uranium reserves of about 22,000 tons and this could significantly increase with further exploration.

The project initially attracted participation from Khan Resources, ARMZ and Mongolia's MonAtom LLC.

Khan Resources' efforts to renew its licenses for the project following the Mongolian government's decision to regulate uranium mining has been far from smooth, with its licenses being suspended and subsequently restored earlier this year.

Khan Resources' shares, which have surged about 180 percent in the last six months, were down 35 percent, or 30 Canadian cents, at 55 Canadian cents Tuesday afternoon on the Toronto Stock Exchange. They touched a low of 51 Canadian cents earlier in the session. (Additional reporting by Arnika Thakur in Bangalore; Editing by Don Sebastian)

Source:Reuters news service

SouthGobi sees jump in Mongolian coal exports to China

* Mongolia expected to export 12 mln T to China in 2010

* China domestic coking coal output short of demand

BEIJING, April 13 - Coal imports from Mongolia are expected to nearly double in 2010 from a year earlier, making Mongolia the third or fourth largest coal supplier to China, the top executive of SouthGobi Energy Resources Ltd said on Tuesday.

Mongolia is likely to ship 12 million tonnes of coal to China this year, up from 8.5 million tonnes in 2009, Alexander Molyneux told Reuters on the sidelines of a Coaltrans conference.

But official statistics showed that China imported just over 6 million tonnes of coal from Mongolia in 2009.

"We estimate that this year already about 3 million tonnes of coal has been sold from Mongolia to China," said Molyneux.

"People see Mongolia as an emerging exporter of coal to China, but nobody is aware how quickly it's becoming a reality."

Last year, Australia was the top supplier of coking coal to China, exporting more than 22.7 million tonnes in 2009, compared to Mongolia's nearly 4 million tonnes.

Molyneux said Mongolia's coal exports to China this year will be predominantly coking coal.

SouthGobi -- which is 80 percent owned by Canada's Ivanhoe Mines -- owns the Ovoot Tolgoi mine in Mongolia, located about 40 km from the Chinese border and containing both thermal and metallurgical coal.

China's sovereign wealth fund, the China Investment Corp (CIC), is also a strategic investor in the company.


China's massive steel sector, the largest in the world, has grown increasingly hungry for high-quality coking coal imports, because the country's coking coal resources are mostly of inferior quality and are getting scarcer.

Some industry officials expected China's coking coal imports to stay at a similar level as a year earlier or even fall slightly. Price differences no longer favour importers, and domestic supplies are likely to improve as Shanxi completes the consolidation drive that slashed output last year.

But coking coal production in the provinces of Henan, Anhui and Shandong, the three largest coking coal producers in China after Shanxi, have either peaked or are about to peak, Molyneux said.

Even in Shanxi, mining coking coal is increasingly costly and dangerous, with miners digging deeper as shallow-lying resources become depleted, he added.

"China could be importing 180 million tonnes of coking coal in five years," he said, adding that by 2015, 15 to 20 percent of the country's coking coal demand would be met by imports.

China's imports of coking coal are expected to jump about 47 percent from a year earlier to 50 million tonnes in 2010, a senior executive of the country's top coking coal producer said earlier on Tuesday.

Source:Reuters news wire service

Mongolia Gets ADB Support for Herder Families Battling Natural Disaster

MANILA, PHILIPPINES - Isolated nomadic herder families in Mongolia who are struggling to survive amidst an unfolding natural disaster are to receive support from the Asian Development Bank's (ADB) Asia Pacific Disaster Response Fund.

A grant of $2.5 million from the Fund to the Government of Mongolia will help deliver food, fuel, and health and social services to herders battling heavy snow and abnormally low temperatures that have affected the country since last December. The brutal winter conditions follow a severe summer drought and shortage of animal fodder, resulting in a local natural disaster known as a dzud.

"ADB is committed to helping herder families affected by the dzud through this very difficult time," said ADB President Haruhiko Kuroda.

The government has declared a state of disaster in 15 of the country's 21 provinces, with over 420,000 people - or a quarter of the rural population - affected by the severe conditions. Nomadic herder families, including pregnant women, have exhausted their food and cooking fuel, and in many cases have lost most of their livestock - the main source of livelihood for up to a third of the country's population. Forced to fend for themselves, families have also been unable to access medical care and other social support services.

Livestock deaths reached 5 million by the end of March, and along with the potential for increased herder poverty, unemployment, and mass urban migration as a result, the large number of carcasses pose an infectious diseases threat as temperatures rise and the snow thaws. Part of ADB's assistance will also be used to remove dead animals in order to contain any risk of disease, and to avoid soil contamination.

The United Nations Resident Coordinator in Mongolia is overseeing disaster relief with assistance already extended from international nongovernmental organizations and development organizations. Bilateral emergency relief is being provided by countries such as People's Republic of China, Russia and Turkey.

The Asia Pacific Disaster Response Fund, established in 2009, provides quick disbursing grants to developing member countries affected by natural calamities. It is designed to help countries meet their immediate expenses, and helps bridge the gap between ADB financing facilities that reduce disaster risks, and those that provide longer term post-disaster reconstruction assistance.
Source: Asian Development Bank (ADB)

Leighton secures $940m contract boost

A subsidiary of Leighton Holdings Ltd has signed a $940 million contract adjustment to increase production at a coal mine in southern Mongolia.

Leighton Asia signed the contract adjustment, which will pave the way for increased production at the Ukhaa Khudag coal mine, according to a statement from the parent company.

The mine produced 1.8 million tonnes of coal last year, after it commenced production in April.

Leighton's contract will allow production from the mine to be ramped up to 10 million tonnes a year by June 2011.

The coal mine is controlled by Energy Resources LLC and Leighton Asia was awarded the original mining contract in February last year.

Leighton Asia managing director Hamish Tyrwhitt, said the request to expand its capacity was the result of his company's success in developing a world class operation at the mine.

"Our strong working relationship with Energy Resources and the local communities in the South Gobi region will ensure the continued success of this project," Mr Tyrwhitt said in a statement.

Leighton Holdings is Australia's largest project development and contracting group.

Its Hong Kong-based subsidiary Leighton Asia has been operating for 35 years.

At 1511 AEDT shares in Leighton Holdings were down 24 cents, at $37.70.


Agricultural Cooperation between Turkey and Mongolia

The first step to be taken in the agricultural cooperation between Turkey and Mongoliawas carried out. In this regard, an agricultural expert (agronomists) employed at TİKA went to Mongolia in order to review Mongolia’s current agricultural potential and exploring the cooperation possibilities in the field as well as to identify priority activity areas and carried out country studies and project works.

The Turkish delegation comprised of TİKA Mongolia Coordinator Erol Çetin, coordinator assistant and the assigned expert met with the First Deputy Minister of the Mongolian Ministry of Food, Agriculture and Light Industry, Janimkhan Saule. Since this step was taken upon the request of the Mongolian Ministry of Food, Agriculture and Light Industry and the Mongolian StateAgricultural University. The meeting allowed for exchange of views on the short term training of the Mongolian experts inTurkey and especially on the possibility of the projects to be carried out in the field of garden plant.
The delegation then met with the Dean of the Faculty and the teaching staff of Agrobiology which depends on the Mongolian State Agricultural University and discussed earning a heated greenhouse for undergraduate, graduate and doctoral students to make their research and experimental works. The feasibility studies of the project were also done.

The delegation also had a talk on the general state of agriculture and livestock sector which is a priority sector in scope of the “2021 Development Strategy” and the problems of the sector and its importance for the Turkish investors as well as got data for the possible projects to be carried out in the future.


Mongolia Names Hong Kong Top Fundraising Market for State Firms

By Hanny Wan

April 12 (Bloomberg) -- Mongolia named Hong Kong as its first-choice market for state-owned assets to raise money from the nation's largest trade partner, China.

Major state-owned companies and assets in energy- and infrastructure-related industries are among those that will seek to raise money selling shares in international and local stock exchanges, Mongolian Prime Minister Sukhbaatar Batbold said. He didn't name any companies or give a timeframe for listings.

"We have chosen Hong Kong specially," Batbold said at a forum on listing of Mongolian companies in the city today. "Hong Kong is a natural choice for us as a funding source and source of expertise because it's the best gateway to Mongolia's largest trade destination."

Hong Kong Exchanges & Clearing Ltd., operator of Asia's third-largest bourse, is trying to attract more listings of overseas companies, particularly those with businesses in China and Asia. Funds raised through initial public offerings surged 276 percent to HK$248 billion ($32 billion) in 2009 from a year earlier, the bourse said March 4.

Batbold added that Mongolia also has an "aggressive agenda" to develop its own capital markets and would seek further cooperation with Hong Kong's stock exchange in that area.

The exchange expects five to 10 Russian companies to seek listings in the city in the "next couple of years," Chairman Ronald Arculli said Feb. 18. The first, United Co. Rusal Ltd., debuted in January. In addition to Russian and Mongolian firms, Hong Kong Exchanges also talked last year with potential listing companies in Australia, Japan, Korea, Taiwan, the U.K. and Vietnam, it said.

SouthGobi Listing

The bourse's executives have visited Ulaanbaatar, Mongolia's capital, five times since 2007, Arculli said.

SouthGobi Energy Resources Ltd., the Canada-listed mining company backed by China's sovereign wealth fund, sold shares in Hong Kong for the first time Jan. 29. The stock has declined 2.9 percent from its debut. SouthGobi started production at its open-cast coal mine in southern Mongolia last year to meet Chinese demand.

China's sovereign wealth fund purchased $50 million of stock in the Hong Kong sale, SouthGobi said Jan. 14. China Investment Corp. also bought $500 million of 30-year senior convertible bonds issued by the coal producer last year.

China has been Mongolia's biggest trading partner throughout the past 10 years, according to materials distributed at the forum. China accounted for 73 percent of Mongolia's exports last year, up from 65 percent in 2008, the materials said. Canada came second with 7.8 percent, and the U.K. at 6.7 percent, according to the data.

--Editors: Nick Gentle, Tom Kohn

Source:Bloomberg news service

Important Days of DPRK Marked in Mongolia

Pyongyang, April 9 (KCNA) -- Seminars, lectures and film shows were held in Mongolia, India and Thailand on April 1 and 2 to commemorate the Day of the Sun, the 17th anniversary of General Secretary Kim Jong Il's election as chairman of the DPRK National Defence Commission and the 78th anniversary of the foundation of the heroic Korean People's Army.
Displayed in their venues were photos on the revolutionary history and undying feats of President
Kim Il Sung and books on the Songun leadership exploits of Kim Jong Il.
The executive chairperson of the Mongolian Mt. Paektu Association for Independent Development in her report at the seminar said that the Koreans and the world people hold Kim Il Sung in high esteem as the sun because he brightly showed the road ahead of mankind in the era of independence with the highest level of light, heat and gravitation, properties of the sun.

Kim Il Sung is a great philosopher and the prominent leader who founded the immortal Juche idea and led the DPRK to victory, she said, stressing that he is always alive, enjoying reverence from the world people.
The chairman of the Juche Philosophy Study Committee of India in a lecture noted that the politico-ideological and military technical power of the KPA has been enhanced in every way under the wise leadership of Kim Jong Il.
The KPA led by Kim Jong Il will as ever demonstrate its might as the invincible army, he stressed. (Korean Central News Agency-Democratic People’s Republic of Korea)

Photo News:Demonstration organized by "People's Movement to demand the promise" on 5 April, 2010

Many retired people took part in the rally.
Herder woman Lkhagvaa from Bayankhongor province demanding dissolution of the State Great Khural-Mongolian Parliament

Protesters gathering in central square of Ulaanbaatar by 11 am.

Buddhist monks came to the square to chant mantra to keep the protesters calm. The monks chanted "Janlavtsogtsol" mantra composed by Zanabazar, 17th century Mongolian saint and sculptor.

Organizers of the rally: from left, Battsogt Dogsom, Ninj, Uyanga Gantomor and Buddhist abbot Sanjdorj, who came to chant mantra to pacify the protesters. Sanjdorj said monks are not taking part in the rally, but were there to chant the mantra.
About 5000 protesters were gathered in central square of Ulaanbaatar about 1 pm , according to Mongolian website Organizers of the rally said hundreds are also taking part in smaller rallies organized in rural aimag centers.
Uyanga Gantomor, one of the organizers addressing the protestors.

5,000 flood Mongolia's capital, demand new govt

ULAN BATOR, Mongolia – More than 5,000 protesters surged through the center of Mongolia's capital Monday to demand that parliament be dissolved and that promised aid be handed out.

The largely peaceful rally was the biggest protest in Ulan Bator since July 2008 when five people were killed and more than 200 were hurt in riots over alleged election fraud.

The protesters, many from rural areas and the slums of Ulan Bator, demanded that the government of the Mongolian People's Revolutionary Party and the Mongolian Democratic Party fulfill promises from the 2008 elections to crack down on graft and better distribute the country's mining wealth.

The two parties promised to share more of the country's natural wealth with the public through outright cash grants or through a fund similar to the Alaska Permanent Fund, which pays dividends to the state's residents from oil revenues.

Governments and opposition parties in the impoverished but resource-rich country tucked between China and Russia have argued for years over how to develop and share the benefits of the natural resources.

"Since both parties lied to the Mongolian people, they have no moral right to sit in the parliament," said Uyanga Gantomor, an activist and one of the protest's organizers. She said if the government failed to respond in 72 hours, the protests would enter the "next stage against the corrupt authorities," though she would not say what actions would be taken.

Uyanga called for the government to correct persisting unfairness, saying that 40 percent of Mongolia's 2.7 million people live in poverty, a lingering problem since the country shook off communism nearly two decades ago.

Poverty is likely to worsen after the coldest winter in three decades killed 4.5 million herd animals, about 10 percent of the country's total. Some dispirited herders have in recent weeks streamed into Ulan Bator looking for work or government aid and further straining the city's already stressed social services.

City officials banned the sale of alcohol on Monday, hoping to avoid the drunkenness that some say contributed to the 2008 election violence.
Protesters, some of whom wore blue Buddhist prayer scarves, also called for the cancellation of the recently passed Oyu Tolgoi investment agreement.

Last August, Mongolian lawmakers voted to phase out a windfall profits tax in 2011, removing the last obstacle to a deal with Rio Tinto Ltd. and Canada's Ivanhoe Mines Ltd. to develop the Oyu Tolgoi gold and copper mine in the Gobi desert. The tax was enacted in 2006 at a time of surging metals prices, but miners said it made tax rates too uncertain and would discourage investment.

Canadian Mining Company Faces Troubles In Mongolia

By Bruce Pannier
Despite the potentially huge profits, it can be difficult to do business in a former communist country -- particularly one that is in Asia. Western companies have learned this the hard way.

One current example is in Mongolia, involving a Canadian company, Khan Resources, and a rapid chain of events that put the company on the verge of losing vast amounts of money and essentially being kicked out of Mongolia. In the end, however, Khan Resources would have the last say.

In early 2009, Khan Resources, which Richard Lockhart describes as a "minor, Toronto-listed uranium explorer" owned a 58 percent interest in the Central Asia Uranium Company (CAUC), with the remaining 42 percent split evenly between the Mongolian government and ARMZ, "which is an arm of Rosatom and ultimately part of Russia's state-owned nuclear conglomerate."

Lockhart is an editor at Newsbase, a British-based news service that publishes reports on the international energy sector, including on conventional fuels and alternative energy resources.

Both those partners wanted a greater share in CAUC, which mines the Dornod uranium deposit in northeastern Mongolia. Dornod contains at least 28,000 tons of uranium, and Russian experts in particular believe further and better exploration could uncover twice that amount.

The Russian government gave its support to ARMZ. Prime Minister Vladimir Putin visited Mongolia in May 2009 for talks with Mongolian officials that focused on Russian participation in mining Mongolian uranium.

According to Lockhart, in July 2009 the "Mongolian government changed the law saying now that Mongolia has to take at least a 51 percent stake in such ventures."

Khan responded that it was hoping for a "reasonable accommodation" with Mongolia's government, but threatened to take Mongolia to international arbitration court. Both parties eventually started talks on a compromise.

Russian Pressure

In late August, Russian President Dmitry Medvedev arrived in Ulan Bator accompanied by Rosatom chief Sergei Kiriyenko.

As Putin had done in May, Medvedev and Kiriyenko met with Mongolian officials to discuss the participation of Russian companies in uranium mining on the territory of its former communist ally. The two sides signed agreements that promised greater Russian participation in extracting Mongolia's uranium.

In September, the head of ARMZ, Vadim Zhivov, said the Mongolian government was reviewing Khan Resource's contract and announced that "all the licenses" for the Dornod site had been temporarily "suspended."
Things got even worse for Khan Resources a month later, when a hostile bid was made for the Canadian company's CAUC shares. "This was obviously one way by the Russians to cement their control" of CAUC, Lockhart says, "and ultimately of the Dornod deposit in eastern Mongolia."

The Russians offered 65 Canadian cents per share (about 35 million U.S. dollars) for Khan's CAUC stake, which it "refused point blank saying that their assets there were worth much more," Lockhart says. "Khan refused ARMZ's offer and refused it not only because of its low value but Khan has also accused ARMZ of negotiating with the Mongolian government without recognizing Khan's interest in the deposit."

Lockhart says ARMZ accused Khan Resources of negotiating with the Mongolian government over the Russian company's interests in Dornod.

A White Knight?

At the start of 2010, Khan Resources' situation seemed hopeless. The company's license to work at the Dornod site was suspended and ARMZ would not withdraw its hostile bid despite Khan's refusal to accept it.

The Mongolian government lifted the suspension in January, but the Russian bid remained on the table and Khan was still at risk of losing at least half its share in CAUC. Khan and the Mongolian government signed a new memorandum of understanding in late January.

But the beleaguered Canadian company received another bid in February. "Khan accepted a rival offer from the Chinese at 96 cents [Canadian], so that's a considerable premium over the Russian's offer," Lockhart says.

The bid came from CNNC Overseas Uranium Holding, a Hong Kong-registered unit of the China National Nuclear Corporation, China's main state-owned nuclear company. Khan had found a buyer that could stand up to the pressure by the Mongolian government and the Russian company and disburse some 53 million U.S. dollars.

ARMZ simply said it was leaving its bid open, but according to Lockhart, the company chose not to renew it when a March 9 deadline arrived. By then, Khan had accused ARMZ of "opaque political maneuvering and unsubstantial allegations without recognizing the rights of Khan or its shareholders."

Endless War Of Words

So is the matter finally settled? Not at all. Khan's agreement to sell its shares to CNNC is not finalized and there are already objections to that deal.

"Since the CNNC put this offer on the table, I understand the offer is valid until mid-April," Lockhart says. "The Mongolian government has also said that any deal selling Khan's interest in Dornod to the Chinese would require the Mongolian government's approval, and Khan Resources denies this."

ARMZ, Khan Resources, and the Mongolian government continue to trade accusations about breaches of their agreement. The Mongolian government has also opened an investigation into the legality of Khan Resources' licenses in Mongolia.

Khan fired off an open letter on March 26, saying the company found it "difficult to understand why only the Canadian partner should be investigated when there are two other partners in the joint venture. Are they to be investigated as well?"

The letter said "inaccurate information" was being fed to the public and media, and that Khan was "surprised and disappointed that the ARMZ has made speculative and unsubstantiated comments about the events that could take place in regard to the uranium licenses in Mongolia."

In the document, Khan accused the Russian company of releasing false information and "telling the government of Mongolia what to do and what not to do."

Source:Radio Free Europe Radio Liberty (

Mongolian Minister of Foreign Affairs and Trade to visit North Korea

According to some sources, Zandanshatar, minister of Foreign Affairs and Trade is to visit North Korea in April. Dates for the visit are not yet confirmed.

Mongolia and North Korea are traditional allies dating back to Korean war in 1950s. Then, Mongolia received hundreds of North Korean war orphans and sent meat and livestock animals to the North Korean regime as support.

Late Kim Il Sen, North Korean supreme ruler visited Mongolia during late 1970s. Both countries still maintains diplomatic and cultural relationships.

By Ganbat, reporter of MonInfo News Service

Mongolia's zud: Bitter toll

As millions of animals die by famine, some herders long for the bad old days

IN A country where livestock outnumber people by an order of 16 to one, animal welfare is no small matter. In Mongolia this year the animals are not faring well at all, and the 2.8m human inhabitants are feeling their pain. Hundreds of thousands of Mongolians depend directly upon animals for their own livelihood.

The immediate cause of everyone’s distress is an untoward sequence of weather events. A bone-dry summer last year was followed by a winter of unusually high wind, low temperatures and heavy snow cover. This combination has meant the country’s yaks, cattle, horses, camels, goats and sheep have gone long months without grazing adequately. The dreaded zud, as Mongolians call this phenomenon, is nothing new. In recent memory it struck three years in a row, starting in 2000—but the damage from this year’s zud is proving to be the worst in decades.

Experts warn that the next four to six weeks will see more cold weather and devastated herds, as ever greater numbers of frozen, emaciated animal carcasses dot the vast Mongolian countryside. The United Nations reckons that this year’s zud has robbed 120,000 Mongolian herders of at least half their livestock and that as many as 500,000 herders have been affected. UN agencies have allocated $3.7m in emergency assistance to help remove animal carcasses, replace herders’ lost income and bring them health services.

According to the International Federation of Red Cross and Red Crescent Societies (IFRC), 19 of Mongolia’s 21 provinces have been afflicted and 4.5m animals—about one-tenth of the total livestock population—have perished in the past three months. The IFRC has launched an emergency appeal to provide food and other supplies, including medical treatment for conditions from frostbite to depression.

The disaster is also descending on the nation’s cities and towns, which already suffer from poverty, poor services and high rates of unemployment. Now it seems they must accommodate an influx of tens of thousands of rural migrants who have lost their herds.

Drought, cold and snow are the proximate causes of this season’s widespread misery. But weather alone is not to blame for its severity. In the 20 years since Communist rule in Mongolia ended, herding practices have changed drastically. Privatisation meant the dismantling of large collectives, and herders now find themselves missing some of the underappreciated benefits of scale—not to mention, in many cases, access to technical and management expertise of the kind that helped sustain operations through harsh winters.

According to Save the Children, another relief agency active in Mongolia, many distressed herders are advocating a return to the Soviet-style system. But even that would not set things right. The old system depended heavily on the Soviet army’s role as a reliable buyer of Mongolian animal products—as well as on direct subsidies ordered by the Politburo. Whatever the zud may bring in years to come, those days are gone for good.

Ivanhoe finalizes Oyu Tolgoi investment agreement

TORONTO, March 31 (Reuters) - Ivanhoe Mines (IVN.TO) has finalized an investment agreement with its partners to develop the Oyu Tolgoi copper-gold project in Mongolia, and full-scale construction is set to begin in the second quarter, the company said on Wednesday.

In October, Mongolia wrapped up a long awaited deal to develop Oyu Tolgoi -- one of the world's largest untapped copper-gold deposits -- when it signed an agreement with Ivanhoe and its partner, Rio Tinto (RIO.AX) (RIO.L).

Ivanhoe said the Mongolian government has now confirmed that procedural and administrative conditions in the investment agreement have been satisfied. [ID:nSP495396]

The Mongolian government will become a junior partner in the development of the $5 billion project. The government, through Erdenes MGL LLC, a state-owned resources company, will acquire a 34 percent stake in an Ivanhoe Mines subsidiary, Oyu Tolgoi LLC, which holds the Oyu Tolgoi mining licenses.

Ivanhoe Mines will own the remaining 66 percent interest in Oyu Tolgoi LLC and will build the project with the financial and technical support of global mining giant Rio Tinto.

Rio Tinto currently owns 22.4 percent of Ivanhoe Mines and holds options to increase that stake to 46.6 percent over the next 19 months.

Ivanhoe said a joint Ivanhoe Mines-Rio Tinto committee has approved an initial $758 million to launch full-scale construction of the Oyu Tolgoi complex in the second quarter.

"The site-wide construction that is about to begin will see the open-pit mine in operation in 2012 and the beginning of commercial production of copper and gold in 2013," said Ivanhoe Chief Executive John Macken in a statement.

The build-out phase of the project will include the construction of a fully paved 105-kilometer (66-mile) highway linking the Oyu Tolgoi site with the Mongolia-China border. It will also include construction of a regional airport that can accommodate Boeing 737-sized aircraft.

By Euan Rocha

Source:Reuters News Service

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