Mongolia plans to bring back to life long-delayed Tavan Tolgoi coal project
Mongolia plans to bring back to life long-delayed Tavan Tolgoi coal project.
Mongolia plans to bring back to life long-delayed Tavan Tolgoi coal project. Located in the South Gobi desert, Tavan Tolgoi is home to the world’s largest high-quality coking coal deposit used in steelmaking, with reserves estimated in 7.5 billion tons. As a first step, Erdenes Tavan Tolgoi (ETT), the state-owned company that holds the license to the deposit, has already begun evaluating bids and calculating the potential economic benefits of reviving it. "If it's profitable for Erdenes Tavan Tolgoi and beneficial for the Mongolian economy, we're open to cooperate with anyone, said Chief economic development officer of ETT, says. The latest impasse came last year, when the Parliament blocked an agreement with a consortium of foreign firms, including China's Shenhua Energy, Japan's Sumitomo Corp. and Hong Kong-listed Mongolian Mining Corp. (MMC), which were interested in developing Tavan Tolgoi. That group of companies, however, still hopes for a favorable resolution of the issue, and their offer is said to still be on the table. In the meantime, the newly established government is expected to honor investment agreements that support the development of Tavan, including building a power plant as a joint project with Japan's Marubeni, and deal with ETT’s outstanding debt to Chinese aluminum producer Chalco Group.
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