Friday, June 4, 2010

Гадаад мэдээ. By Joseph Chaney

By Joseph Chaney, Asia Resources Correspondent
HONG KONG, April 12 (Reuters) - Hong Kong is a natural choice for Mongolian enterprises to go public as the resources-rich country develops its vast untapped mineral wealth, the Mongolian prime minister said on Monday.
Mongolia is attracting attention from global investors after it sealed a deal in October with Ivanhoe Mines and Rio Tinto to develop the $3 billion Oyu Tolgoi mine, one of the world's biggest untapped copper and gold deposits.
Now, Mongolia's resources companies -- from coal to copper to iron ore miners -- are actively seeking foreign investors and aim to list shares in markets such as Hong Kong this year.
"Hong Kong is a natural choice for us because of its geographic proximity -- it's the best gateway to trade destinations, such as China," Mongolian Prime Minister Sukhbaatariin Batbold said in a joint event with Hong Kong's stock exchange on Monday. Batbold said the government would also press ahead with its initiative to privatise many of the country's assets and companies, including coal producers and power plants, with an eye toward creating 'national champions'. The landlocked country's firms are in need of foreign investment and expertise as they ramp up development, he said.

Mongolia also plans to raise $1 billion-plus via a global bond sale in the fourth quarter this year to fund major development projects in areas such as mining and infrastructure.
"Mongolia is at a very exciting stage of development. We need expertise from investors abroad," said Batbold, who added he will meet Chinese Premier Wen Jiabao on Tuesday to talk about economic ties between the two countries.
"We have this momentum and we need to keep up this momentum."
In January, Mongolia-focused coal miner SouthGobi Energy Resources Ltd -- 80 percent owned by Ivanhoe -- raised $439 million in a Hong Kong IPO, which attracted high-profile cornerstone investors such as sovereign wealth funds China Investment Corp and Singapore's Temasek Holdings.
Mongolian coal firm Energy Resources is also eyeing a Hong Kong or London IPO, previous media reports have said.
Still, despite the current momentum, Mongolia's development trajectory has seen its fair share of turbulence.
Earlier this year, the country's leaders said they wanted to cancel an auction for a 49 percent slice of the world's biggest untapped coking coal mine Tavan Tolgoi, which had drawn bids from Russia, China and Japan. It hopes to strike a deal with a global miner to develop the deposit on a contract basis, without a significant equity holding in the project.
The government is currently formulating the Tavan Tolgoi development plan, and aims to have a draft by the end of the month, Batbold said on Monday.
Mongolia, with a population of roughly 3 million, seeks to raise its GDP per capita to $12,000 by 2021, Mongolian officials said during the Hong Kong event, driven largely by the development of its key resources sector. It now has a GDP per capita of roughly $3,400.
Official Mongolian forecasts suggest coal production will double, gold output treble and copper quadruple in the next five years.
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