Mongolia has failed to identify a suitable investor for the development of the Borteeg section of the Tavantolgoi coal deposit group after none of the bids submitted in an international tender met government requirements.
The Mongolian government has now decided that the project will be managed by state-owned coal producer Erdenes Tavantolgoi. According to Minister of Economy and Development Jadamyn Enkhbayar, coal production and exports at the site will proceed with the participation of domestic companies, local media outlet Montsame reported.
The open tender, announced in February, invited both Mongolian and foreign companies to invest in the development of the Borteeg deposit and participate in exploiting its reserves.
Under the tender conditions, the winning bidder was expected to finance and construct all required infrastructure for coal extraction, processing, sales and transportation. A key condition imposed by the government required Mongolia to receive at least 51% of total sales revenue throughout the life of the project.
According to the Ministry of Economy and Development, seven companies from Mongolia and abroad submitted proposals. A working group evaluated the bids based on financial and economic returns, experience in implementing similar projects and the existence of a comprehensive development plan.
However, none of the proposals scored highly enough to proceed to the negotiation stage, ministry officials stated.
The Borteeg section is estimated to contain 424.2 million tonnes of coal reserves. Annual production capacity could reach up to 15 million tonnes.
