Source: www.open-government.mn                          Date: 31 March, 2011

The Government of Mongolia has ratified the selection by the National Development and Innovation Committee (NDIC) of Bechtel as Program Management Consultant (PMC+) for greenfield development and construction of industrial and infrastructure projects in the Sainshand Industrial Complex and has asked the NDIC to start negotiations with the American company on terms and conditions of the contract.

The anticipated PMC+ services include the development of a Master Plan, providing  management consulting services for all the projects now identified, as also for some others, including off site ones and utilities, if and as required. Bechtel’s proposal in response to a tender floated in September 2010 was found superior to those submitted by three other bidders -- Fluor, Worley Parsons, and Hatch.

The NDIC has also chosen a joint team -- consisting of Liberty Partners LLC, BNP Paribas, McKinsey, and Pillsbury – to work as the Project Advisory Consortium, including international legal services. The Consortium will design the overall commercial, ownership and legal structure of the projects and will work with the selected Program Manager on the initial planning for the projects leading to a Master Plan, and recommend any additionally necessary feasibility studies for individual processing plants. The projects will be planned to allow the maximum possible Mongolian participation in them.

If no agreement is reached with either Bechtel or the other consortium on the terms for their work, their choice will be annulled and fresh negotiations begun with those who are now the second choice. These have not been named.

The Boston Consulting Group has said construction of the industrial complex will enable economic diversification and make the economy less vulnerable to external price shocks for natural resources. The project spearheads Mongolia’s industrialization plans that will create about 78,000 jobs between 2010 and 2021, according to Mr. Ch. Ganbat, Adviser to the Minister of Road, Transportation, Construction and Urban Development of Mongolia.