The Minerals Ministry, Government agencies, NGOs all plan to celebrate the 90th anniversary of the establishment of the mining industry in Mongolia. How will your Association observe the landmark? All organizations in the sector, including the Ministry of Mineral Resources and Energy, the Mineral Resources Authority, the State Professional Inspection Agency and our own Mongolian National Mining Association agreed on the need and importance of jointly celebrating the event in a way. An apex committee and several sub-committees were formed and these have been working on their allotted tasks. The first of the many events planned during the year was the Coal-Mongolia 2012 investment conference.
That ministries and others are working together is a great thing. We hope this will not end with just jointly organizing events, but will lead to adoption of a consensus national policy and taking uniformly accepted decisions. For the moment, we are happy these events will help people get a correct idea of how the mining industry has been and is developing, disabusing negative perceptions, and also honour senior miners now retired. We intend to spread this awareness right from children upwards, through producing an animation series on mining in Mongolia.
Among the events planned in the coming months is the 5th MineTech, the annual expo for mining equipment producers and suppliers and service providers. This will be held on March 28-30, and will be followed by Discover Mongolia International Mining Investors’ Forum, scheduled for September as usual.
A new event this year will be a workshop called Workplace Safety First, to be sponsored jointly by the Erdenet factory and Oyu Tolgoi LLC. The event seeks to emphasise the need to prioritise safety at the workplace as an essential component of responsible mining. Each and every operating mine should think of safety first, then of production, and of revenue and profit only after that.
Coming back to MineTech, it used to be a small affair over only a few hours during the day, but from last year it has changed to more of an Expo. Instead of just a handful of companies advertising their products, we now have many more companies, including major foreign ones, eager to showcase the new technologies and equipment they wish to provide through their distributors in Mongolia.
For example? Right now, I can think of Scania Group of Sweden, Mercedes and Liebherr of Germany, Iveco-Astra of Italy, and Caterpillar. This allows us access to technology from beyond Russia, which is what we have always used, but which is now getting somewhat outdated in terms of fuel efficiency and such issues. I’m not saying that Russian technology is bad; we are still using some of it. It also has an advantage for Mongolian miners in that they are familiar with it.
Among others is the Belarussian manufacturer BelAZ which has updated its products. Hera Equipment is its distributor. Then there are Japanese and Korean manufacturers such as Sumitomo, Mitsubishi and Hyundai Heavy Industry, which are offering some great new facilities.
Even when high grade European technology is available, some companies continue to use Russian technology. It may have performance life of 20 years but has been in use for more than 30 years. What is your take on this?
This mostly depends on the company’s ability to invest in new technology. Big companies like Baganuur and Shivee-Ovoo are in a difficult situation. One reason for this is that the State fixes the price of coal they supply to the power plants. This affects their development and growth. Another restricting factor is that these companies don’t export their coal. They should be seeking opportunities to raise their product price and look for other buyers.
Companies owned totally or mostly by the State have a poor management system. With the State controlling their product price, they can’t even talk about making a profit, and they usually end up in the red. The Government cannot keep petroleum prices under control and shouldn’t be going hard on coal mines. It should deregulate coal prices and let the companies improve their operation. Of late, some steps are being taken to cancel all debts between the coal mines and the power plants. This is a step and should be followed by allowing the coal producers to sell on the international market.
Please subscribe to our journal to read more.