Mongolian Parliament plans to sell Tavan Tolgoi coal mine
Mongolia’s parliament voted in favor of an initial public offering in state-owned Erdenes Tavan Tolgoi Corp.
Mongolian lawmakers approved a plan to sell up to 30% of the Tavan Tolgoi coal mine in the Gobi desert, the latest attempt to develop what’s anticipated to be massive coking and thermal coal deposits. Mongolia’s parliament voted in favor of an initial public offering in state-owned Erdenes Tavan Tolgoi Corp. In a broadly written resolution, the legislation instructed Prime Minister Khurelsukh Ukhnaa to take "urgent measures" for the construction of a railway and roads related to the project. A potential IPO is at least the third effort to develop the mine. The latter included China Shenhua Energy Co., Japan’s Sumitomo Corp., and Mongolian Mining Corp. investing $4 billion in the mine and a railway for sales to China. "Based on the quality, a lot of commodity players will be interested," said Munkhjargal Otgon, deputy chief executive officer of Ulaanbaatar-based Golomt Capital. In addition to the transportation routes, the resolution called for the construction of a power plant at the site, which had been part of Rio Tinto Group’s plans to develop the Oyu Tolgoi copper-gold mine.
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