Russia to Get Mongolian Deposit for Roads
Russia may get access to Tavan Tolgoy, the biggest coal deposit of Mongolia. During his recent visit to Russia, Mongolian Transport Minister Tsegmed Tsengel offered to Moscow to take part in the road construction in exchange for the title to this deposit. Severstal is tipped as the top applicant for Tavan Tolgoy, and Vneshtorgbank (VTB), Vneshekonombank (VEB) and International Investment Bank (IIB) are expected to finance the project.
Mongolia’s offer to Russia to participate in the 1,500km road construction was announced after past week’s meeting of Russia’s Transport Minister Igor Levitin with his Mongolian counterpart Tsegmed Tsengel. The settlement could be the loan secured by government of Mongolia or the title to some deposit, which exact name was not disclosed then.
It could be the world biggest coal deposit, Tavan Tolgoy, said a source close to negotiations on condition of anonymity. “Russian companies have been trying to get the right for its development for several years but thus far the Mongols have always avoided direct talks,” the source said.
Tavan Tolgoy, 250km from Chinese border, has 5 billion tons to 6 billion tons in coal reserves worth at least $300 billion. High coking coal accounts for roughly 40 percent of them. The license is held by Mongolian Energy Resources, which is said to be acting on behalf of top-ranked officials of Mongolia, including Tsegmed Tsengel.
Past November, Russia’s Severstal and Zarubezhgeologia applied to Mongolian government seeking the interest in Tavan Tolgoy’s development. The market players stake on Severstal, the more so that Igor Levitin, who once worked at Severstal-affiliated Severstaltrans, is the key negotiator now.
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All the Article in Russian as of Apr. 06, 2006
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