Mongolia is preparing to overturn last year’s cancellation of more than 100 mining licenses following a corruption investigation, in a further attempt to revive investor confidence in the mineral rich nation.
The central Asian nation, reports Financial Times (subs. required), has also vowed to end its long-dragged dispute with mining giant Rio Tinto (LON:RIO) over a delayed investment to expand Oyu Tolgoi, the country’s largest copper mine, operated by Vancouver-based Turquoise Hill (NYSE:TRQ).
Talks between Rio and Mongolia on the expansion and reworking of the initial 2009 deal that first triggered an investment boom in the country, have dragged on for more than a year. Both sides provided fresh faces for the Oyu Tolgoi board in September to break the impasse and resumed talks in December.
“Mongolia has learnt a good lesson . . . the important thing for us is to create good jobs and good revenues,” the deputy minister for economic development, Ochirbat Chuluunbat, was quoted as saying by FT.com.
Last month Mongolia’s government said it intended to submit two bills to parliament that could stimulate its mining sector and stoke investment. The first would invalidate a 2010 law suspending the issue of new exploration licenses. The second would change guidelines applied to a 2009 law on rivers and forests, to allow mining in areas previously off-limits due to environmental concerns.
Last week Kincora Copper, one of 11 foreign investors whose mineral exploration licenses were revoked last year, said Mongolia appeared to have made a “step change” in its approach to mining in recent weeks.
If the Mongolian government’s goodwill reaches Rio, Oyu Tolgoi will account for 30% of the economy of the nation of just over 3 million people.