Mongolia Energy Riches Attract Neighbors and Outside Interests

By: John C.K. Daly of OilPrice.com

Pity poor Mongolia, bereft of fiscal resources, caught between the ambitions of its superpower neighbors, Russia and China.

Ulaan Bator’s situation is akin to interwar Poland, dexterously attempting to reconcile its foreign policy between the USSR’s hammer and Nazi Germany’s hard place. Who will ultimately benefit is anyone’s guess, but the country’s nascent energy and mineralogical riches have opened the land of Genghis Khan to a fierce bidding war those ultimate outcome is unclear at best.

The nation is essentially empty, its 2.8 million citizens producing an average population density of just over 1 person per sq. km.

That said, the country’s mineralogical riches are more than impressive. More importantly for global mining interests, Mongolia was a Soviet satrapy from 1924 until the 1991 implosion of the USSR and those reserves remained offline.

Until now.

Whaddya looking for? Mongolia’s mining sector has some of the world’s richest deposits of gold and copper, uranium, coal, fluorspar as well as (rare earth elements) RREs such as tantalum, niobium, thorium, yttrium and zircon. According to a 2009 estimation by the U.S. Geological Survey, Mongolia has 31million tons of rare earth reserves, or 16.77 percent of the world’s total, exceeded only by China.

Oh, and coal.

Erdenes, a state firm is overseeing the Tavan Tolgoi (“Five Hills”) massive coal deposit located in the east Tsankhi area of Mongolia’s Gobi desert, estimated to hold over 7.5 billion metric tons of coking coal, essential for making steel, and the currently world’s biggest untapped deposit.

Where’s it gonna go?

Potential suitors include Russian, Chinese, Japanese and South Korean firms, while representatives from 20 global investment banks jetted into sunny Ulaan Bator to make their pitches.

While Mongolia’s economy was traditionally based on herding and agriculture, neighboring China’s rising demand for minerals has underpinned its current mining boom, and Beijing would undoubtedly happily buy virtually all of Tavan Tolgoi’s output.

But, business, is business, and Mongolia is currently weighing all offers.

In 2006 Mongolia’s Mineral Law was amended to increase government royalties and licensing fees, reduce tax incentives, set duration terms for exploration licenses, and provide for up to 50 percent government ownership of strategically important resources when jointly funded by the state and private investors. On 25 August 2009 the Ulsyn Ikh Khural (State Great Hural, or Parliament) finally repealed the 68 percent windfall profit tax, effective from January 1, 2011, setting the stage of massive foreign investment.

Since April 2010 Mongolia’s benchmark MSE Top 20 Index has been the world’s best performer and its currency, the tugrik, the fifth-biggest gainer against the dollar. The International Monetary Fund says that Mongolia’s economic growth may surge to 23 percent in 2013, more than twice the forecast expansion in China.

In June the Mongolian government gave each citizen 538 shares in the upcoming Erdenes-Tavan Tolgoi IPO. If the IPO hits its anticipated $10 billion, each Mongolian shares would be worth about $360.

The local populace will be watching the Tavan Tolgoi negotiations closely, as Mongolia is a country where the CIA estimates that more that 36 percent of the population lives below the poverty line, with an annual per capita income of $2,900. After all, in a democracy, a 2.8 millionth share in a site estimated to be worth more than $48 billion is nothing to sneeze at, and is cheaper than mounting the pony and replaying the campaigns of Genghis Khan to secure booty.

Source: http://oilprice.com/Metals/Commodities/Mongolia-Energy-Riches-Attract-Neighbors-and-Outside-Interests.html

By: John C.K. Daly of OilPrice.com


Tea Party Express Celebrates WI Senate Victories!

CONTACT: Levi Russell at [email protected], or (509) 979-6615

Tea Party Express Celebrates Resounding WI Senate Victories!
Voters Reject Union Bullying and Choose to Restore Common Sense!

The Tea Party Express is celebrating state senate victories in Wisconsin today, with election wins for State Senators Harsdorf, Cowles, Darling and Olsen after conducting a statewide tour rallying support for Republican state senators last weekend.

Despite an outrageous onslaught of fear mongering, distortion and intimidation tactics from the far left and national union groups, the majority of Wisconsin voters were not fooled and voted to support senators who did their job and stood by Governor Walker’s budget reform. Although three Republican state senators were not able to fend off the baseless attacks against them, the people of Wisconsin have defeated the enemies of prosperity and kept the state on a successful path.

Tea Party Express Chief Strategist Sal Russo said, “The facts clearly demonstrate that Governor Walker’s plan is working. The state has added some 40,000 private sector jobs this year and closed a three billion budget gap. The importance of those achievements cannot be overstated – Wisconsin has set an example that the Nation as a whole should follow.

“The union lobby groups have been defaming principled Republicans because they fear the balance of power shifting back to the people of Wisconsin where it belongs. The fact is, these liberal special interest groups are protesting a plan that has already brought greater prosperity to the people. By pouring money into Wisconsin and catching the Republicans off-guard from such an assault, three decent Senators appear to have been defeated.”

But this fight is not yet over. Next week the people of Wisconsin will vote in the recall of Democrat state senators who obstructed democracy by fleeing the state and refusing to engage in much needed debate. Wisconsinites deserve representatives who are willing to make tough decision for the good of the state, which is why Senators Holperin and Wirch need to go.

For more information or to schedule an interview, please contact Levi Russell at 509-979-6615 or [email protected]



By: Dave Logan

Big labor, the democrat party and the entire main stream media apparatus was boots on the ground in the Wisconsin recall effort. On our side we had… well… hang on… oh, we had the Tea Party, and more specifically, The Tea Party Express and all the people who contributed to making the wheels go ’round. That’s about it. And who came out the winner last night? The people of Wisconsin, that’s who.

The progressive movement left no stone unturned in trying to unseat at least three republicans in yesterday’s special election. They had throngs of “useful idiots” running about with their not-so-homemade-signs for background shots on MSNBC’s The ED Show. Poor Ed, he tried his progressive best to keep the audience in a positive and hopeful mood, but in the end they had to be given the bad news: that the people of Wisconsin had spoken, the recall effort had failed. So sorry, Ed, Rachael, et al. So sorry.

And a special, heartfelt “I’m so sorry” goes out to MSNBC’S Al Sharpton who yesterday played a clip of Andrea Shea King speaking at a TPX tour stop, announcing to the crowd that the S&P downgrade was being dubbed “The Tea Party downgrade.” You know you’ve arrived when Al Sharpton plays a clip of you on his ridiculous show.

Hey, Al, Andrea’s doin’ The Happy Dance!!