CHARTS: The coming critical minerals trade war is BRICS short of a load
"While a large number of countries around the world continue to talk about securing raw material supply, China is actually doing something about it."
Mongolia’s Prime Minister Chimed Saikhanbileg said Friday his country should take charge of how long a dispute with Rio Tinto (LON:RIO) over developing the second stage of a copper and gold mine in the country has taken.
“Much of the blame (for the delay) goes to us,” said Saikhanbileg according to Reuters.
Oyu Tolgoi mine’s $6.5 billion second underground phase has been under revision since 2013, amid complaints about cost overruns, political uncertainty and a dispute over taxes.
But last week Rio and its subsidiary Turquoise Hill Resources (TSE:TRQ), which is the mine operator, said talks with authorities were finally down to only a few issues. Rio’s chief executive, Sam Walsh, noted he was very “patient and hopeful” that an agreement would be reached, Sydney Morning Herald reported.
A lot is at stake for both parties. For Rio, expanding Oyu Tolgoi will bolster its copper business and lower its dependence on iron ore. For Mongolia, it needs cash quickly from the mine to meet spending commitments.
Mongolia has had a strong economy in recent years, gaining 17.5% growth in 2011. But that figure has since slid to the current 6.3%, with foreign investment dropping by 59% last year alone. On top of that, prices of the country’s main mineral exports —gold, copper and coal— keep falling.
According to Turquoise Hill, Oyu Tolgoi — located about 80 kilometers (50 miles) north of the Chinese border — will contribute about a third of Mongolia’s economy when in full operation.
5 Comments
Rod M. Kerr
Greedy is what they are.
Honheree
The PM of Mongolia also stated that the dispute would be settled by the end of 2015…………after going on for many years! This just another Mongolian ploy of ‘making a poison’ to allow the corrupt greedy elite, and politicians to make it difficult for Rio Tinto. Read the first three paragraphs of the Mongolian President’s speech on February 12, 2015 to understand what I mean… http://www.president.mn/eng/newsCenter/viewNews.php?newsId=1456
They have employed this along with false accusations to disrupt Centerra, and are now facing the $100 million consequences of their illegal, corrupt dealing with Khan Resources. It is this dirty way of thinking and corruption that has brought Mongolia where it is today.
us
the guy clearly spends a lot of time thinking about how he can sound profound when hes got nothing but excuses ,not worth reading don’t know who he thinks hes kidding
Bileg
Russia and China with assistance of some greedy Mongolian politicians and NGOs were, are and will try to push out an investment of those so-called ‘third neighbor’ countries of Mongolia and the country will fall again into that old centuries isolation from the outer world. Certainly no one except Russians and Chinese will be allowed in the country.
Honheree
An additional comment and more ‘making poison’. After the PM of Mongolia stated that not only Oyu tolgoi but Tavan tolgoi would be settled, the Speaker of Ikh Khural (Parliament) stated, ‘no way” per the following:
http://mongolia.gogo.mn/r/145284
So, on and on it goes!!! Delay after delay……….. Who in the Mongolian Government speaks for Mongolia and who can be trusted. They should be so ashamed and embarrassed, but no they prefer to show the world how arrogant, corrupt, greedy and incapable of governing democratically they are.