Source: Bloomberg News                    Date: 14 April, 2011

Mongolia may announce the winning bids to develop Tavan Tolgoi next month. “Negotiations are still ongoing,” Mr. E. Amarkhuu, Director-General of Fuel Policy at the Ministry of Mineral Resources and Energy told reporters in Beijing on Tuesday. Mongolia will choose more than one of the six groups shortlisted for the project, he said.

Talks are under way on the contract for the central and western part of the site. The shortlist includes Peabody Energy Corp., a Shenhua Group Corp.-Mitsui & Co. joint venture, Vale SA, a Russia-Japan-South Korea consortium, ArcelorMittal, and Xstrata Plc.

“Definitely not one,” Mr. Amarkhuu said, when asked about the number of winners. “It’ll be a combination of the companies.” The Government is seeking mining expertise and commitment to infrastructure development, including railway construction, Mr. Amarkhuu said. Mongolia is also targeting “value-added production” including coal-to-liquid and coal-to-gas projects, he said.

The Government hopes 90 percent of the employees at Tavan Tolgoi will be local, Mr. Amarkhuu said. “It’s difficult because it heavily depends on availability of qualified personnel,” he said. “We have to see whether Mongolia has a sufficient number of them.” Foreign companies can bring in their own staff while training locals “as fast as possible” and gradually replacing the imported workforce with Mongolians, Mr. Amarkhuu said.