42.HAFTA BCM (BUSINESS COUNCIL OF MONGOLIA) HABERLERİ

Business
FRANCE'S ENGIE WITHDRAWS FROM TT POWER PLANT BID
The French state-owned energy companyEngie SAhas withdrawn its bid to join a private consortium of investors to invest in a power plant at the[http;//www.erdenestt.mn]Tavan Tolgoi coking coal minethat will be used to power mining operations in Umnugobi Aimag, including the[http;//www.ot.mn]Oyu Tolgoi copper-gold mine. Engie will not join Japan's Sojtiz Corp., South Korea's POSCO Energy and[http;//www.newcom.mn]Newcom Groupto build and operate the power plant, said Minister Mendsaikhan Enkhsaikhan. The decision was related to France's hosting the U.N. Climate Change conference in November and the likely criticism it would face to be leading multiple coal-fired power plant projects in Mongolia. Engie is a member of a consortium to develop Combined Heat and Power Plant No. 5.
However, Enkhsaikhan had some good news regarding the project, too. Oyu Tolgoi's 66 percent shareholder, Turquoise Hill Resources Ltd., has committed to a USD1 billion guarantee for investors to help raise funds for the power plant.
Source:Mongolia.GoGo.mn
MAK SIGNS 2 INVESTMENT DEALS AFTER MORE THAN TWO YEARS OF STAGNATION
Mongolyn Alt Corp. (MAK) has signed two major investment deals after years of sinking business for the conglomerate amid worsening economic conditions. Mining Minister R. Jigjid signed an investment agreement for the construction of a concentration plant for Tsagaan Suvarga molybdenum deposit at Mandakh Soum Dornogobi Aimag. MAK plans to build the plant to produce up to 4,000 tons of molybdenum concentrate.
Also that day, Industry Minister D. Erdenebat signed an investment agreement with MAK for the construction of lime-cement plant at the Khokh Tsav lime deposit, located at Dalanjargalan Soum, Dornogobi Aimag. The agreement comes two years after the government first announced plans for its establishment.
Source:Montsame,2
PRODUCTION AT GUILDFORD COAL’S BNU MINE ON TARGET
Guildford Coal Ltd. is on track to achieve its production target of 125,000 tons a month from its Baruun Noyon Uul (BNU) metallurgical coal mine, according to a recent company update. The company mined 72,138 tons of coal in September 2015 and expects to reach production of 125,589 tons in December.
Guildford forecasts a direct cash cost positive margin on its hard coking coal product of between USD9 and USD11 a ton for the fourth quarter, despite current weakness in metallurgical coal markets. “While the market continued to remain soft, there are some positive signs and there is still strong buyer interest for the BNU coking coal,” said the company.
Source:World Coal
TIAN POH RESOURCES BUILDS COPPER-MOLYBDENUM CONFIDENCE IN MONGOLIA
Tian Poh Resources Ltd. has hit copper grades up to 1,100 parts per million (ppm) and molybdenum grades up to 585ppm during due diligence drilling at the Zuun Mod project in Mongolia. Most drilling samples from surface to 244 meters depth returned from 200 to 1,100 ppm copper (average 750 ppm copper) and about 30 to 200 ppm molybdenum (average 206 ppm molybdenum), with highest concentration being 585 ppm molybdenum. The results were much higher in concentration than samples from the lower part of the hole (244 to 450 meters), where copper averaged 288 ppm in grade and molybdenum averaged 31 ppm.
This work represented the completion of due diligence drilling as part of Tian Poh’s acquisition of Zuun Mod from Erdene Resources Ltd. The drilling program was designed to test the Khuvyn Khar North target zone, located on the northeastern part of Khuvyn Khar.
Source:Proactive Investors
BURGER KING ENTERS MONGOLIAN COURT
Burger King, the U.S. fast-food chain, will open its first branch in Ulaanbaatar on 16 October, making it the first major burger restaurant to open in the country. The Mongolian holding company MAX Group has taken the franchise rights to the burger chain, with its first restaurant to open in the Bayangol District. "We will provide and offer good quality, low price, wide selection and quick service for the brand,” said MAX Group President D. Ganbaatar.
KFC was the first major fast food chain to open in Mongolia, followed by another Yum Inc.'s brand, Pizza Hut. Both are owned and operated byTavan Bogd Group.
Source:Udriin Sonin
EBRD FINANCES MCS COCA-COLA'S USD30 MN FRUIT JUICE, TEA EXPANSION PROJECT
The[http;//www.ebrd.com]European Bank for Reconstruction and Development (EBRD)will loan USD30 million to MCS Coca-Cola LLC finance the installation of new technology and equipment to expand its production of fruit juices and bottled teas. The loan will finance investments in new, energy efficient glass and hot fill bottling lines, aligning with the bank's aim to support the local production of fast-moving consumer goods in Mongolia. The long-term senior loan will include a local-currency portion (USD8 million equivalent in tugrug), to help the company hedge against foreign exchange risks.
“The EBRD is supporting one of the core activities of a well-diversified group meeting the highest standards of corporate governance,” said the EBRD head of office in Ulaanbaatar, Matthieu le Blan. “It is in line with our strategy of supporting the diversification of the economy by financing competitive sectors and reducing Mongolia’s reliance on imports for consumer’s goods.”
Source:EBRD
HOTELS RECEIVE ASEM ACCREDITATION
The government has pitted 42 local hotels against each other to see who can best upgrade their hospitality services in the face of stiff competition from foreign competitors in Ulaanbaatar, such as Best Western Premier and[http;//www.shangri-la.com/ulaanbaatar]Shangri-La. The government will lend a total MNT150 billion to selected hotels in an effort to improve services for the more than 4,000 guests expected to arrive for the upcoming Asia-Europe Meeting (ASEM) scheduled for next year. Hotels will pay 9 percent interest on the loans, compared with a national policy rate of 13 percent, with six years before repayment.
The Ministry of Foreign Affairs has also accredited 40 hotels as partners for the event.
Read the full list of partner hotelshere.
Source:Udriin Sonin,Mongolia.GoGo.mn
DEVELOPMENT BANK FORMS SUBSIDIARIES FOR CONSTRUCTION, EXPORT INSURANCE
The Development Bank of Mongolia will launch two subsidiary companies for lending to construction projects and providing export insurance to companies. The Cabinet Secretariat approved the motion to establish the subsidiaries on 12 October.
Source:Montsame
RC INSPECTION’S MONGOLIAN LABORATORY IS ISO 17025 ACCREDITED
RC Inspection Group’s RCI Analytical Services, based in Mongolia, is now ISO 17025 accredited. This is the second accredited laboratory for the company. The company wanted ISO 17025 accreditations for its laboratory activities in order to ensure a high level of assurance to its clients.
RC Inspection has indicated this accreditation has been a key step in its overall future development, enabling it to carry out fully independent qualitative and quantitative evaluation of the chemical elements contained in metals listed on the London Metals Exchange. The relevant and required techniques are used to define the purity and minimum assay that the registered brands must meet. The company’s laboratories, based in the Netherlands, Mongolia and Ukraine, provide analytical science problem solving and testing capabilities to a wide range of customers across many industries.
Source:World Coal
KHAN BANK OPENS SELF-SERVICE EXPRESS BANKING CENTERS IN DARKHAN AND ERDENET
[http;//www.khanbank.com]Khan Bank LLCcelebrated the opening of 24-hour self-service Express Banking Centers equipped with Recycle ATMs in Darkhan and Erdenet on October 6, it said in a statement. The Recycle ATMs installed at the Express Banking Centers are the first ATMs in Mongolia that will allow customers to deposit or withdraw up to MNT 5 million, or 250 banknotes, at a time.
Khan Bank has already opened its self-service Express Banking Centers in more populated areas of Ulaanbaatar's six districts.
Source:Montsame
UB SEEKS COOPERATION WITH BILL & MELINDA GATES FOUNDATION FOR GER DISTRICTS
Ulaanbaatar Mayor Erdene Bat-Uul will appeal to the Bill & Melinda Gates Foundation for sustainable urban development in Ulaanbaatar's ger districts to help move residents into apartment housing. Bat-Uul on 13 October ordered that a working group be established to work directly with the foundation, run by the billionaire and former-Microsoft chief Bill Gates and his wife Melinda, to help encourage development of the city while mitigating the destruction toll on city land.
Source:Montsame
CENTERRA GOLD ANNOUNCES CEO, PRESIDENT APPOINTMENTS
[http;//www.centerragold.com]Centerra Gold Inc.announced on 13 October that Scott Perry will be appointed as chief executive officer (CEO), effective 1 November, replacing Ian Atkinson after it was announced last March that he would retire by year-end. Perry has more than 20 years of experience in the gold industry. His previous work experience included assignments as CEO at AuRico Gold Incorporated, as chief financial officer (CFO) at AuRico Gold Incorporated, as CFO at Highland Gold, and as CFO at Barrick Gold's Russian and Central Asia Business Unit. Additionally, Centerra announced the appointment of Frank Herbert as President. Herbert has been general counsel and corporate secretary of Centerra since 2004. In his new role, Frank's responsibilities will include oversight of the company's legal matters, government relations and negotiations, and working with Perry in setting the strategic direction for Centerra.
Source:Centerra Gold Inc.
KHAN BANK FOUNDATION SPONSORS CHEMOTHERAPY DEPARTMENT AT RURAL HOSPITAL
A new cancer chemotherapy department sponsored by the Khan Bank Foundation has opened at Sukhbaatar Aimag's central hospital.[http;//www.khanbank.com]Khan Bank LLC's foundation helped finance the establishment of the department, which was first completed a year after it was first initiated by the Jargalsaikhan Foundation. Chemotherapy is used to kill cancer cells and reducing cancer growth in patients. Last year, 161 patients were diagnosed with cancer in Sukhbaatar, and 127 passed away.
Source:Khan Bank LLC
Economy
MONGOL BANK: FX AUCTIONS; CURRENCY SWAPS; 1-WEEK BILLS; T-BILLS
The Bank of Mongolia on 15 October auctioned USD1.1 million (out of USD2.65 million in bids) and CNY4 million (out of CNY14.5 million in bids) to commercial banks at closing exchange rates of MNT1,994 and MNT314.19, respectively. Also that day, it accepted tugrug swaps with commercial banks for an equivalent of USD20 million. Left on the table were U.S. dollar swaps worth USD12.3 million and a forward agreement selling offer worth USD25 million.
The Bank of Mongolia on 14 October issued 1-week bills worth MNT188.9 billion at a weighted interest rate of 13 percent. Also that day, the central bank received MNT11.5 billion in bids for 28-week treasury bills with a face value of MNT10 billion that were sold at a discounted price and with a weighted average yield of 14.311 percent.
Source:Bank of Mongolia
2015 STATE budget DEFICIT CONTINUES TO WIDEN
The 2015 State budget deficit grew 8.1 percent from the year before in the first nine months of the year, totaling MNT867.3 billion. The deficit has been exacerbated by lesser taxes collected from business amid the current economic troubles. Tax revenue decreased 4.5 percent against the previous year, with value added tax collected falling 24.9 percent. Export-import taxes collected fell 12.4 percent.
Total expenditures increased 9.1 percent from the previous year, to MNT4.9 trillion.
Source:Montsame
UBTZ TO HIKE FREIGHT COSTS
Ulaanbaatar Railway (UBTZ), a Mongolian and Russian government joint venture, will hike its freight costs, beginning on 1 November. The price to transport non-ferrous and ferrous metals will increase by 20 percent in November, while petroleum products will see a 10 percent increase, among other areas where prices will rise.
Source:News.mn
BANKERS COMPLAIN GOVERNMENT T-BILLS ARE REDUCING FUNDS INTO SAVINGS ACCOUNTS
Some bankers have grown frustrated competing with the government as some local investors opt for government bonds instead of savings accounts. The Mongolian Bankers Association has issued a statement complaining that the government's issue of treasury bills each week has moved funds away from savings accounts at commercial banks. Medium-term bonds with interest rates of between 14 and 15 percent continue to sell well, and to some are less risky than banks in Mongolia after seeing three banks collapse since 2009. Total government bond trading on the secondary market was MNT 347.1 billion for first 9 months of the year, a 2.9 percent growth from the year before.
Other observers dismiss the complaint, saying that although issuing bonds for expenditures was increasing debt, it was better that borrowing comes from within the local economy rather than from outside sources.
Source:Mongolia.GoGo.mn
MONGOLIA PREPARES WHEAT, FUEL RESERVES
Mongolia is building up reserves of wheat and petroleum to prevent any price swings that could exacerbate challenges this winter if the weather turns nasty and dangerous for herders. Mongolia has built up reserves of 20,000 tons of wheat from Mongolian farms, said Food and Agriculture Minister R. Burmaa, amid widespread concerns this year's wheat harvest will not be enough for winter. Strong government intervention to prevent a scarcity of fodder for herders could help the country sidestep a nasty dzud this year, or what Mongolians call a harsh winter that results in many animal deaths.
The Cabinet has also approved the formation of a government and private business alliance to manage reserves of petroleum products.
Source:Montsame
WHEAT HARVEST TAKES HARDEST HIT FROM SUMMER DROUGHT
This year's harvests figures are coming in, showing better than expected production results after a heavy drought during summer threatened food security, with wheat production the worst affected. Farmers will see 46.2 percent of full grain production, 85.1 percent for potatoes and 83.1 percent of vegetables, reported the Ministry of Food and Agriculture. More than 650 students and 950 soldiers have helped with the harvest.
Source:Mongolia.GoGo.mn
HEALTH CENTERS OFFER FREE 'MARMOT PLAGUE’ VACCINATIONS
Free vaccinations for the so-called ‘marmot plague’ has been made available for travelers to the countryside. Vaccinations for the bubonic plague will be available at the National Center for Zoological Disease and district health centers, said center director N. Tsogbadrakh, following the death of a 41-year old man in Darkhan. A warning has been issued against the consumption of raw marmot meat, despite some local traditions that say it's good for people's health. Marmots have been the main point of contact for those who contract the disease, which is spread to rodents from fleas. The handling of hunted marmots is also considered dangerous.
Mongolia has 82 recorded cases of bubonic plague between 1995 and 2014.
Source:Mongolia.GoGo.mn
FMD OUTBREAK REPORTED IN BAYAN-ULGII
Health officials have a put a quarantine on Altai Soum, Bayan-Ulgii Aimag following an outbreak of foot-and-mouth disease (FMD). This marks the third outbreak this year.