Will China get more Mongolian mining concessions after Premier Wen's visit?
An official visit to Mongolia by China's premier may result in gains in Mongolian mineral concessions for Chinese companies.
Author: Dorothy Kosich
Posted: Wednesday , 02 Jun 2010
RENO, NV -
mineweb.com
Chinese Premier Wen Jiabao concluded a two-day official visit to Mongolia today, calling for a feasibility study on a China-Mongolia free trade area, and the adoption of trade and economic cooperation in the development of mineral and energy resources.
Wen, a former geologist, held talks with Mongolian Prime Minister Sukhbaataryn Batbold to promote cooperation in mineral resources development, infrastructure construction such as transportation development, finance, energy, and environmental protection.
Batbold said Chinese enterprises are welcome to expand investments in Mongolia, and participate in the development of mineral and energy resources. China is Mongolia's largest trading partner and biggest source of investment, estimated to represent 40% of foreign investment in Mongolia.
Wen also met with Mongolian President Tsakhia Elbegdorj and Damdingiin Demberel, chairman of the State Great Hural (parliament) of Mongolia. The two countries had been expected to sign a number of agreements during Wen's visit to Mongolia.
The Chinese premier said China will import more dairy and agricultural products from Mongolia, which lost 8.2 million animals or nearly a fifth of all livestock in Mongolia, perished this past winter. A third of Mongolians are herders, who measure their wealth by livestock ownership.
China and Mongolia share a 4,676-kilometer border. Among the major mining projects located near that border is the Tavan Tolgoi coal project, believed to be the world's largest undeveloped coking coal deposit.
Tavan Tolgoi, which is believed to have coal reserves of 6.5 billion tons, has attracted the attention of Australia's BHP Billiton, India's Jindal Steel & Power, Brazil's Vale, U.S. coal miner Peabody, and China's Shenhua Energy.
Since 2009 Shenhua has been building the Gan Quan Railway to transport coal from Tavan Tolgoi. The Mongolian government has suggested that successful bidders for the massive coal deposits must invest in infrastructure construction in the country as part of the deal.
Wen was expected to have discussed the issue of financing Mongolia's mineral deposits during his visit.
As Mineweb has reported during the past two years, China and Russia have both competed for Mongolia's mineral and energy resources. Canadian junior Khan Resources has lost its licenses for the Dornod uranium property in Mongolia to Russia's state-owned ARMZ Resources.
Russian state-owned nuclear power company Rosatom won a large concession to mine uranium in Mongolia after a state visit from Russian President Dmitri Medvedev to Mongolia in August 2009.
Powerful Russian oligarchs also reportedly pressured the Mongolian government to give them a stake in Ivanhoe's massive Oyu Tolgoi copper-gold project.
State-owned Russian Railways (RZD) also pushed for the concession to build the railway serving the Tavan Tolgoi coal project with the goal of transporting coal to help power development of the Russian Far West. |
