Archives have names at the top and date at the bottom of each post. These are prior posts from the dates indicated. To search the posts for particular data or companies use control-F on PCs and command-F on Macs.
For current posts, as well as a list of companies operating in Mongolia, a current list of articles by the author, and current author disclosures, please go to Mongolia Weekly Update.
Jon SpringerComments (1373)
Here is the weekly news from Mongolia plus the last two items (31 & 32) are things I learned doing research this week and an article from 1999. For regulars here, I have tried to make the list of companies at the top of the blog more user-friendly (you can now click on the company name and hyperlink to their website) and am open to suggestions for further improvements.
2) Erdene Resources (OTCPK:ERDCF) has a noteworthy private placement. Although based in Canada, the private placement is being led by Mongolian investment bank MICC. The private placement is to raise money from Mongolians -
The Chronicle Herald in Canada: http://bit.ly/viJqRm
MICC's site: http://www.micc.mn/
Erdene's press release: http://mwne.ws/tgGw4c
6) Petro Matad (PRDTF.PK) has good results this week: http://bit.ly/uxBVhj
8) Guilford Coal (GUF.AX) has good results:
9) Australia will have an IPO for Kara Minerals (KMM.AX), a company focused on developing tin assets in Mongolia. Planned listing date is December 5, 2011.
Research note from Mr. Belfitt-Nash at Monet Capital: http://bit.ly/tN6CJC
Company site: http://bit.ly/tonIFm/
10) Xanadu Mines (XAM.AX) to begin drilling targeting metallurgical coal. Note that Xanadu is partnered with Noble Group (OTCPK:NOBGF) (OTCPK:NOBGY).
Proactive Investors: http://bit.ly/th6ofr
Press release: http://bit.ly/sBsVyT
11) C@ (CEO.AX) updates their plans for exploration, offering, name change, etc:http://bit.ly/svUjl8
12) Mongolia Energy (0276.HK) (OTCPK:MOAEF) (OTCPK:MOAEY) expects to record a profit for the six months ending September 30, 2011, whereas they had a loss for the same period last year: http://bit.ly/tYF1xv
13) Robe Australia Limited (ROB.AX) annual general meeting. Two pages. Company sold all assets and ceased operation in 2009. Now considering a coal project in Mongolia. http://bit.ly/tF6iCU
14) On the Mongolian Stock Exchange, Sudut JSC was renamed Asia Pacific Properties as part of the reverse merger discussed in the recent Mongolia: Why And How To Invest In Real Estate.
16) Very good interview with the World Bank's senior economist in Mongolia Rogier van den Brink: http://bit.ly/tm9cqR
And Mr. van den Brink blogs on the World Bank blogspot as well: http://bit.ly/rXdPSf
17) Discussions about the need for a power plant at Oyu Tolgoi being needed sooner than planned. Price tag: $1 billion. Time to build once they decided to build it: 18 months. http://bit.ly/ugotpE
Moreover, there is an energy shortage in northern China which is hindering Oyu Tolgoi's ability to import energy from China: http://bit.ly/sgYkpy
18) Political wrangling over shares to be distributed from Erdenes MGL Tavan Tolgoi ("Tavan Tolgoi East"): http://bit.ly/tjPswt
19) The CFO of "Tavan Tolgoi East" says the timing of the company's IPO is still unclear: http://bit.ly/sXZvvN
20) Over to "Tavan Tolgoi West", the property open to bidding previously awarded to China Shenhua, Peabody, and a Russian-Mongolian consortium before the National Security Council of Mongolia nixed the deal. The second item in this China Daily briefing says "The review 'should be concluded very soon, hopefully before the Lunar New Year (January 23, 2012)'":
21) Privately held Sinobo Group (http://bit.ly/snzuwk) has a molybdenum mine concern in Mongolia (http://bit.ly/rBgbSl). Resources in Mongolia is one of the companies priorities according to its profile.
22) Article in FT on dealmaking in Mongolia with a focus on private equity outfit Mongolia Opportunities Fund: http://on.ft.com/v3GuZC
23) GE signs $100 million wind power deal with local conglomerate Newcom:
GE has offices in Newcom's building. I realized during my visit to Mongolia that going into the buildings of the local (privately held) conglomerates and noting the other companies in the building was important for understanding local corporate alliances. Here is GE's announcement of opening their Mongolia office in the Newcom building from May (including extensive agreements to work together): http://bit.ly/rDdc4J
24) Privately held Mongolian conglomerate Monnis (http://monnis.com/) has formed a strategic alliance with privately held mining contractor Dumas (http://bit.ly/v1vbKs):http://bit.ly/skbdlY
- Here's some companies located in Monnis's headquarters building in Ulan Bator: AeroMongolia (a subsidiary), Oyu Tologi, Mongolia Minerals, Noble Group, South Gobi Sands (of which they own a part), Leighton, Peabody Winsway, Korea Resources, Govi Ex, Rio Tinto, MacMahon Holdings, and Origo Partners. Monnis is a well-run company and I believe most of its building occupants are strategically chosen and business partners. The company history page is an interesting quick read:http://bit.ly/thkVXx
25) National Statistics Committee of Mongolia says 39.2% of population is poor, 47.8% of population in countryside and 32.8% of residents in Ulan Bator:http://bit.ly/vz4lG9
27) Stashing away the name Chuluun Togtokh as someone relevant and concerned about the environment in Mongolia. He points out flaws in the U.N.'s Human Development Index (HDI). "If the U.N. continues to encourage countries such as Mongolia to aspire to the U.S. lifestyle, we will all be in serious trouble." and "My country is likely to become one of the fastest growing economies in the world, but the current HDI offers no encouragement for it to grow sustainably.":
28) An odd tidbit from Family Security Matters on whether Mongolia is the next Dubai and geopolitical considerations: http://bit.ly/sccPXf
29) Government passes measure to improve professional training for educators:http://bit.ly/tMojIa
30) Al-Jazeera joins Bloomberg TV in Mongolia: http://bit.ly/uIreNR
31) Things I learned doing research this week.
a) Hunnu (albeit recently sold to Banpu), Haranga, and Voyager all had/have the same Chairman (Matt Wood; HUNFF.PK was for coal, HAR.AX is for iron ore, VOYRF.PK is for copper-gold; all in Mongolia).
b) Xanadu's (XAM.AX) Andrew Stewart, their chief geologist and on-site manager in Mongolia, previously ran exploration for Ivanhoe and is based in Ulan Bator.
32) From 1999, what Mongolia Growth Group CEO Harris Kupperman was doing when he was 18: http://bit.ly/tf6jNw/
21 Nov 2011, 12:32 AMReplyDelete CommentLike4
Jon SpringerComments (1373)
Mongolia Growth Group announced today a private placement to raise CDN$20-$30 million. The closing date is December 23. Details here:
My reason to mention this as a mid-week update: this completes the trifecta with APIP, M.A.D. Investment Solutions, and Mongolia Growth Group all planning to raise $20 - $30 million in the next couple of months meaning a potential deployment of $60 - $90 million primarily in the real estate sector by spring. (The other two private placement were previously mentioned in the Why And How To Invest In Real Estate piecehttp://seekingalpha.co...)
Regarding Mongolia Growth Group specifically, there has been pressure on the stock price recently not only because of the general pressure on the market, but because the last lock-up period of all the prior private placements ended on October 24, 2011.
21 Nov 2011, 08:46 PMReplyDelete CommentLike6
Valley BoyComments (1422)
Mongolia is catching some publicity on Bloomberg TV for being a serious emerging market open for business. The firm is being mentioned as a viable investment option.
The replay button might need to be clicked to watch the interview.
22 Nov 2011, 09:13 AMReplyDelete CommentLike4
I had the privilege of speaking with Harris Kupperman over a few beers after his presentation. He seems like a very honest, sharp, and capable leader. I really like his business model and I think his management style is great for long term success in Mongolia; however, I would like to see how the upcoming contraction in China and the implosion in Europe play out before I commit to anything.
I am planning on spending two weeks in Mongolia (UB) around memorial day 2012. I will also be attempting to reach out to interested business owners and investors in China who have made money in the Chinese real estate boom, but are quickly realizing that it's time to move on to other trends.
Jon, I hope you will have a trip planned around the late Spring to early Summer as well.
23 Nov 2011, 05:13 PMReplyDelete CommentLike3
Jon SpringerComments (1373)
I'm glad to hear at least one person following this blog attended the Mongolia Growth Group presentation. I have heard little news about it except one person who thought there were several hedge fund mangers in the room, as opposed to previous presentations that were primarily individual investors (and I have no idea if this is accurate).
I think you would have some interested folks if you wrote a longer post, instablog, or article on your impressions of the the presentation, Mr. Kupperman, and Mongolia, myself included.
You would know better than I the exact situation in China. Do you feel that it is a slow-down, or a real contraction (recession)? Do you think this pull-back in China will be extended or short? And again, I think with your knowledge base and insights, you could probably write a worthwhile instablog or article on this topic. There's a lot of information on China and its hard to discern the truth of it as with these two recent pieces in the FT (one say R/E transactions are down 39% year over year in the 15 biggest cities; the other three days earlier by the same author says home prices have only dipped .15% in the 70 largest cities).
As for a return trip to Mongolia, for me it will have to be between February and April of next year if I can schedule it in. By the middle of May, I will have obligations that occupy me through at least September, and possibly the remainder of the year with one or two relocations in that time period.
23 Nov 2011, 07:12 PMReplyDelete CommentLike4
There were several hedge fund managers in the room; I actually got to befriend one from a start-up. Most of these hedge fund managers were not very familiar with MGG or the overall boom in Mongolia, which was a bit surprising to me. What was also interesting is that there were several young professionals in their 20s who do not have much capital by themselves, but were much more knowledgeable about MGG than the hedge fund managers. They follow Kupperman's blog on a regular basis and actually have plans to visit Mongolia in the near future. Harris was quite nice to invite those of us who stayed till the end and treated us to have a few beers with him.
The general presentation that Harris gave was from the exact same file on his MGG website; therefore, it was very broad and did not go too much into the details. Harris must have wanted to target the general audience that had little insight on Mongolia and the real estate boom that is taking place there. One very interesting detail that Harris did mention is that MGG is steering away from residential properties. They believe owning the land itself for commercial property development is much less of a headache and burden on management than residential property, but it is also potentially much more profitable. MGG is primarily focused on the affluent downtown region of UB, their newly developing insurance subsidiary (auto & life), and they would like to get into financial services such as a Mongolian mutual fund in the future.
*I currently do not have my notes with me, so I may give another update later.*
About the situation in China, it really depends on how the government will respond. It seems that there will be a chronic recession for an extended period of time in China orchestrated by the Chinese central government. Here are my reasons why:
1. A sharp depression or disruption in the economy would cause social distress. One thing that the Communist Party of China (NYSE:CPC) fears the most is having their power overthrown due to social distress. As much as they are seen as authoritarian, they are truly under the mercy of 1.4 billion people.
2. China is attempting to shift from an unsustainable export and infrastructure model to a consumption model. Contrary to what many analysts who do not understand the culture in China, raising interest rates in China actually stimulates and encourages consumption, not savings. Historically, lower interest rates correlates to higher savings rates in majority households. By raising interest rates, the "hot money" flowing into China will be restricted and it will create a wealth effect for the majority of the people. This is overall good for the long term health and sustainability of China. Basically, it's the only chance China has got without being overthrown by a billion migrant workers and peasants.
3. This is the perfect time to orchestrate a recession and slow down China's overheated economy. Why? Europe is in shambles. America isn't doing too well either. The word is that there is a "global recession" going on. While European and U.S. mainstream politicians are not willing to admit to this, China's leaders are embracing it. Please read: http://reut.rs/rw2AX0
Why? Because now they can politically put all the blame on the "international financal crisis" caused by the irresponsible Western governments.
4. China probably understands at this point that nothing is going to save the current E.U. If they send in any bailout money, it's money down the drain and the Chinese people would be a lot less forgiving than the OWS movement. An implosion or drastic contraction in Europe is inevitable. Since the E.U. is China's #1 export customer, China's exports will be affected.
As much as I have been investing in precious metals, I do think the peak of the bubble will happen within the next few years in this decade.
Please let me know when you go to Mongolia. I would like to meet up with you while I'm there if possible. February would be too early. March and April might be a bit excruciatingly cold, but if you're going to tough it up, then so will I!
23 Nov 2011, 09:53 PMReplyDelete CommentLike5
Excellent post, haiguike! I tend to agree with your take on China, and the geopolitical argument resonates as well.
24 Nov 2011, 08:31 AMReplyDelete CommentLike3
China car sales growth went from 35% down to 3-5% 2011
...car sales show their economy is headed south
27 Dec 2011, 09:36 AMReplyDelete CommentLike2
Valley BoyComments (1422)
There was some discussion within the government about the possibility of supplying Mongolia's industries, its southern mines in particular, with nuclear energy. The map with the energy distribution system on page 9 of 30 of the energy strategies report seems to indicate that there is potential to set up nuclear facilities in Erdenet and Baganuur. Power from Erdenet would serve the northern and western parts of the country. Power from Baganuur would serve the eastern and southern parts of Mongolia.
27 Nov 2011, 01:05 AMReplyDelete CommentLike5
Valley BoyComments (1422)
The nuclear power development scenario seems murky now that nuclear waste is not allowed to be stored within Mongolia. If waste were to be generated it would probably be sent to Siberia in return for certain geopolitical favors.
27 Nov 2011, 12:49 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
VB. Thank you for the great links. The power point in the first of the four links in the original post is worth looking at for anyone interested in uranium investing in Mongolia. Some of the larger uranium producers in Mongolia included Areva (OTCPK:ARVCF) and Denison Mines (NYSEMKT:DNN).
28 Nov 2011, 08:24 AMReplyDelete CommentLike4
Jon SpringerComments (1373)
You will notice comments being "deleted" from this blog. They are not being actually deleted but relocated. I have now established archives for the Mongolia news blog:
July 18 to October 3, 2011 - http://seekingalpha.co...
October 3 to November 15, 2011 - http://seekingalpha.co...
Weekly update of news coming later.
27 Nov 2011, 10:49 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
Mongolia Weekly Update, November 28, 2011.
1) Two articles by me this past week -
Copper Investing In Mongolia: http://seekingalpha.co...
Mongolia Growth Group Raises Private Funds To Deploy In Country's Real Estate Market: http://seekingalpha.co...
(those were not my original titles)
2) Mongolia Energy Corporation (MOEAF.PK) (MOEAY.PK) has completed a 311 km road to China to transport its coal. The road can support a payload up to 110 tonnes. Final permission for usage should come today, November 28, 2011. http://bit.ly/vRDbrj
3) Prophecy Coal (OTCQX:PRPCF) has received permission to build a power plant in eastern Mongolia which will use its coal to produce energy at a plant operated by its subsidiary East Energy Development (this Chandanga project was previously posted September 15, 2011, by Peter Epstein) -
Proactive Investors: http://bit.ly/uqgFjW
9) Xanadu Mines (XAM.AX) announces a 100% acquisition of a coal property in northern Mongolia: http://bit.ly/txIbrW
10) TVN (TVN.AX) is changing its name to Modun Resources and will have a new ticker shortly. Also, an update on their Nuurst coal project in Mongolia is in this announcement. http://bit.ly/rHlYl7
11) C@ (CEO.AX) has halted its trading November 28, 2011, pending an announcement about raising capital. http://bit.ly/u7LlD2
12) On the Australia Stock Exchange, an upcoming IPO for FeOre Limited. The company has off-take agreements for its iron ore in place already with a China Railway subsidiary. The Chairman notes, "The Company has been established as the listed holding company for a proposed iron ore production project in Mongolia. The Company's major assets are an interest in the Mongolian mining licence 9095A for a JORC compliant iron ore deposit of 108,700,000 tonnes known as the Ereeny Project; and an interest in the Mongolian iron exploration licence 5930X which lies 40 kilometres to the east of the area covered by the mining licence. The split of this mineral resource amount for the Ereeny Project between inferred and indicated is set out in Section 1 (Investment Overview) below" in the prospectus: http://bit.ly/t6Jqwg
13) Mongolia Investment Group (0402.HK) announces losses expected to be higher year-over-year for the six months ended September 30, 2011: http://bit.ly/v6teIX
14) Australia is planning a special tax of 30% on coal and iron-ore profits (thanks to FPA for the link). I count 9 Australian companies listed above who have coal and iron-ore projects in Mongolia (plus there is BHP and RIO). I tend to think this will encourage more work in Mongolia and less in Australia.
15) A profile of Mongolia conglomerate Max Group's rise in Mongolia's "wild west economy"; a good quick read for perspective on the economy's development, the article discusses how two brothers went from smugglers to being a major conglomerate force in Mongolia (from SUU JSC - the largest dairy company in Mongolia - to food, clothing, and alcohol distribution):
More from ForbesAsia on SUU: http://onforb.es/tkfnhx
MaxGroup: http://bit.ly/ulg8mi (links to subsidiary companies at the bottom of the home page)
16) Iron ore prices in China may go down as the Chinese have "identified 4 - 5 billion tonnes" of ore mines recently. Perhaps not good for FeOre (upcoming IPO above) or Haranga (HAR.AX). http://bit.ly/vSNrxH
17) Xinjiang province of China is short 1.6 million tonnes of coal annually and is looking to Mongolia to fill that gap. http://bit.ly/t3oort
18) A good print interview with the head of the Budget Policy Board of Mongolia's Finance Ministry. At the end he discusses that the Mongolian Development Bank has a priority on rail projects with a plan to put $60 million toward railway infrastructure in the first tranche although they need $5 billion in rail investment. http://bit.ly/uGqcnu
19) A German industrial alliance and their moves toward investing in rare earth resources in Mongolia that were paved by Angela Merkel's recent visit to Mongolia (thanks to OptionsGirl for the link). BASF, Thyssen Krupp, and Evonik are specifically mentioned: http://bit.ly/sC57gN
And Mongolia's President Elbegdorj pledged Mongolia will develop deeper ties with the EU: http://bit.ly/vx9nnl
20) Continued political wrangling over how "Tavan Tolgoi East" shares will be distributed to the public and private sectors in Mongolia: http://bit.ly/t9P5VL
21) Residents of Tsetserleg soum (soum = county) in Khusvul aimag (aimag = province) are sending a complaint to the Mineral Resources and Energy Minister that a newly operating privately held Australian coal company is causing (too much) pollution. The company has supposedly offered 1 million Togrog (about $750) to each herder that has had animals die form the pollution. http://bit.ly/veciUR
22) A report from the Fitch ratings agency last Monday (on November 21) claims the Philippines, China, Taiwan, and Mongolia are among the countries well-equipped to weather a global economic downturn: http://bit.ly/s128IW
23) Mongolia government has a plan for building regional oil refineries throughout the country by 2015: http://bit.ly/thKkFy
25) The European Bank of Reconstruction and Development (EBRD) and the Asian Development Bank (ADB) sign a memorandum of understanding to "promote public-private partnerships" (PPPs) throughout Central Asia: http://bit.ly/uexmim
26) The Business Council Of Mongolia reprints one of last week's FT articles and I learn something noticing once again the fine line between "development banks" and the private sector in Mongolia. The managing director and founder of the private equity fund Mongolia Opportunities Fund was the Asian Development Bank's country director in Mongolia from 2005 to 2008:
27) Plans to construct a metro (or subway) system in Ulan Bator in 2013:http://bit.ly/sgtFl0
28) Strikes on Monday (November 28) against unsatisfactory pay raises for teachers by teachers, media workers, healthcare workers, and trade unions:http://bit.ly/uSgCUg
And a report on a bit of the strike: http://bit.ly/rMU77I
29) Electronic ID cards for all citizens will start being issued December 20, 2011, in Mongolia: http://bit.ly/s6kpoC
30) Agriculture is still the biggest portion of Mongolia's economy. Al-Jazeera has a lengthy article about land management practices: http://bit.ly/ukIOUS
31) Mongolian privately held conglomerate news. Bodi Group has partnered with state-run international airline MIAT to start a domestic airline called Mongolian Airlines beginning in December 2011. Mongolian Airlines will compete with Newcom's EZnis Airways and Monnis's Aero Mongolia. http://bit.ly/s40vKR
32) Entrepreneurship alert. Neiman Marcus sells yurts (also known as "gers") for $75,000 and Occupy Toronto protesters purchased yurts from Mongolia for $20,000 each according to this article:
Here's the $75,000 version: http://bit.ly/u02AQZ
33) Added this week to the list of companies at the top are:
- Asia Coal Limited (0835.HK), coal, Mongolia
- Central Asia Metals (CAML.L), copper/gold/molybdenum, Mongolia/Kazakhstan
- Mongolia Investment Group (0402.HK), coal/copper/gold in Mongolia, water infrastructure in Hong Kong
- North Asia Resources (0061.HK), iron/copper/gold, Mongolia
34) Things I found while researching this past week:
a) For those interested in petroleum investments, Ivanhoe Energy (NASDAQ:IVAN) has a map showing where multiple operators in Mongolia have their fields/rights including Petro Matad (OTCPK:PRTDF), PetroChina (NYSE:PTR), IVAN, and China Golden Sea Petroleum (private).
b) RBS Mongolia Opportunity Certificate presentation. Fun facts include claiming Mongolia as #2 in the world in copper reserves and uranium reserves.http://bit.ly/tD4N07
c) Eurasia Capital October 2010 presentation has Mongolia as #4 in coal reserves as well as #2 in copper reserves. Has compelling comparison to Kazakhstan and Qatar's development. http://bit.ly/sLmrIk
d) PriceWaterhouseCoopers "Mongolia Doing Business Guide 2010-2011"http://bit.ly/rpvZEp
e) M.A.D. Investment Solutions Mongolia Outlook January 2011 presentation (78 pages). Page 16 has an interesting comparison of current coal trends in Mongolia compared to Indonesia's coal development 1992 - 2002. Page 21 lists the top 14 banks by assets as of 3Q2010. Page 27 has charts comparing Mongolia with Kazakhstan and Qatar. Page 41 & 42 have private equity deals (EBRD included). Stock reports go from page 45 to 74, many listed in the U.S. http://bit.ly/svbYtN
f) 2009 Mineral Yearbook on Mongolia by U.S. Geological Surveyhttp://on.doi.gov/srnXkb
g) Top 100 companies in Mongolia 2011: http://bit.ly/rRW1LC
28 Nov 2011, 08:20 AMReplyDelete CommentLike4
Thank you for #14 and #17. I will be adding excerpts of these articles to my presentations. Australia is already at a disadvantage competing with Mongolia due to logistical challenges. If they do carry through with the 30% special tax on coal profits, then supply to China from Australia will be significantly more expensive than Mongolia.
#27 - This is extremely bullish for UB real estate. One only has to look at Vancouver and Tokyo to see what a well developed metro system can do for real estate development.
#32 - If a protester can afford a $75,000 ger, then why is he/she even protesting?
#34 - Coal and copper will provide a tremendous boost in GDP to Mongolia, but not many people are talking about uranium. Once the uranium boom revives, it will give Mongolia another boost for many many decades to come. Japan and Germany are already quickly realizing how foolish they are to avoid nuclear power.
There will be so many opportunities in Mongolia in our lifetime; some of us should probably dedicate ourselves to learn Mongolian.
28 Nov 2011, 02:31 PMReplyDelete CommentLike4
Joseph L. ShaeferComments (1189)
Re Le Metro...
2 of the 8 companies in the world that still enjoy a AAA rating are metros -- Hong Kong (OTCPK:MTRJY) and Singapore (SPMRY.) Both make it not on fares but on advertising and retail space in their stations (and other land provided as right-of-way, etc.) It's in the future in UB, if it comes to fruition, but that will likely afford less speculative avenues to profit in Mongolia, as will the retailers, restauranteurs and provisioners who follow the miners and drillers et al. Jon, you really are on the ground floor!
29 Nov 2011, 07:09 PMReplyDelete CommentLike5
Suzhou Blue TigerComments (71)
As someone who has lived in China for 15 years and personally employ over 1,000 people here I can tell you China is really slowing down. Car sales aren't bad, up 3-5% in 2011, but you have to consider the market was up 35% in 2010. car sales actually went negative in October.Housing has stopped, but not due to lack of demand but due to government controls. 2012 will be the first year in awhile we will not struggle to find workers as many plants are closing down due to a lack of credit. Raw material prices such as Pig iron and Scrap are down about 15% in the last few months which is a small reduction. How long it lasts? Don't forget Chinese New year is coming up in Jan. A lot of spending there. Since China as abruptly changed from tightening to loosen monetary policy we will see stocks rally big time, unless of course we get a EU implosion.The gov. should loosen some housing controls in 2012, watch a massive price boom in real estate at that time.It's been pent up for 2 years already. As regards to Mongolia, they represent only 1-2% of China's total coking coal demand. They are a total safe haven. Any demand destruction in China will not affect them. Also, Mongolian coat is going only into Xinjiang at the moment. Xinjiang will be booming for the next 10 years as Beijing throws money at them to quiet unrest.
2 Dec 2011, 10:30 AMReplyDelete CommentLike8
Thank you for your valuable firsthand insights, Blue Tiger. Which region are you located in China? Do you have any insights on real estate development in the Hunan or Xinjiang provinces? What about mining development in Xinjiang? It may be much easier to invest in Xinjiang than Mongolia.
2 Dec 2011, 12:28 PMReplyDelete CommentLike4
Suzhou Blue TigerComments (71)
I am in Suzhou. No idea on real estate in Hunan or Xinjiang. I prefer real estate in Jiangsu where the population is wealthy and huge populations are trying to crowd into certain places. For instance, 2 hours drive out of Shanghai you have 80 million people and everyone wants and apartment in a few square km around the huangpu river. I see these areas as great futures. I don't directly invest in mining companies, just go through the stock market. In this case, China would be much more stable than Mongolia. For Mongolia, I am focusing on large companies that will benefit from general economic growth from the mining boom.
2 Dec 2011, 08:16 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
Mongolia weekly update below. Thanks to Suzhou Blue Tiger and Haiguike for the dialogue on China above. 80%+ exports from Mongolia go to China. Conversation about China is welcome here.
2) A two-part interview with Shaun Rein by Seeking Alpha founder David Jackson related to China:
Stocks To Own And Stocks To Avoid To Profit From China's Growth - An Interview With China Expert Shaun Rein, Part 1 http://seekingalpha.co...
Profiting from China's Growth With Sector And Macro Bets - An Interview With Shaun Rein, Part II http://seekingalpha.co...
4) Entrée Gold (EGI) closes its offering fast. Rio Tinto had pre-emptive rights and exercised them for the entire $14.35 million offering at $1.25/share (EGI closed Friday December 3, 2011, at $1.35). http://bit.ly/v1NYJD
6) Mongolia Growth Group (OTCPK:MNGGF) announces:
a) In concert with the Business Council of Mongolia, Mongolia Growth Group insurance unit Mandal Insurance held a forum on risk management November 30, 2011. http://bit.ly/ucFB1Z
b) Dedicated ex-pat VIP insurance services through it Mandal Insurance unit:http://bit.ly/w0e1Dv
c) Employee option at CDN$4.25 http://bit.ly/s5WyF2
7) Ivanhoe (IVN) sees "low chance" of delays at Oyu Tolgoi due to delays with a power station: http://bit.ly/vl6FMC
8) Comment by Ivanhoe (IVN) CEO Robert Friedland on the global economy, the progress of Oyu Tolgoi, and the Chinese putting "a couple of billion" into infrastructure in anticipation of Oyu Tolgoi (from power plants to roadways):
9) Mongolia's Defense Minister, who is also a member of parliament think Mongolian citizens should directly own 10% of Oyu Tolgoi. Oyu Tolgoi is 34% owned by the government, and the remaining portion is split between Ivanhoe (IVN) and Rio Tinto (RIO): http://bit.ly/tDLylG
10) MCS, parent company of Mongolia Mining Corporation (MOGLF.PK) has new loans of $125 million with the possibility to extend to $150 million. (dated November 16 but just found) http://buswk.co/sXxXEc
11) Aspire Mining (OTC:ASPXF) (AKM.AX), more on their alliance with Noble Group (OTCPK:NOBGF) (OTCPK:NOBGY). Stock is showing positive signs in reaction (though you need to consult the AKM.AX chart as it doesn't show the same reaction on ASPXF.PK yet)
12) Manas Petroleum (OTCPK:MNAP) "currently focusing on six areas in order to meet the corporate goal of entering in to a drilling contract by the end of the first quarter of 2012 and spud the first well before the end of the second quarter." http://bit.ly/vgSekd
Manas has also hired General Research "to provide investor relations and corporate communications services in Europe" http://bit.ly/vCCyOL
14) Haranga (HAR.AX) announces "Substantial High Grade Iron Ore Intersected." Remember that Haranga has Matthew Wood as Chairman, as does Voyager (copper-gold in Mongolia), and as did Hunnu (coal in Monoglia) that was sold recently to Banpu.
Other companies Mr. Wood is Chariman of include
Avanco Resources (AVB.AX) (copper/nickel/platinum in Brazil) -http://bit.ly/tjwqYg
Copper Range (CRJ.AX) (iron ore, base metals, phosphate in Australia) -http://bit.ly/uVYwYt
Signature Metals (SBL.AX) (gold in Ghana; iron ore/nickel/copper in Kenya & Uganda) - http://bit.ly/rZGMjd
It is also noted he has previously been a director of Bellamel Mining, Black Range, Elk Petroleum, Iberian Resources, Kasbah Resources, Laguna Resources, and Overland Resources
15) Xanadu Mines (XAM.AX) gets a 30-year lease on coal property in Mongolia with two optional 20-year extensions. Thermal coal; possible gasification. "sub-bituminous coal resource in excess of 327 million tonnes of which more than half is indicated status and described as being amenable to mining by open cut methods." "Xanadu intends to engage potential technical and equity partners to develop the project."
16) Modun Resources (MOU.AX) changes their name from TVN Corporation. Visit their website http://bit.ly/vJ01Qq Their December 1, 2011 presentation notes their thermal coal project is 6km from existing rail networks and lists others with proximity to existing rails (Peabody-Winsway (NYSE:BTU) (1733.HK) and Xanadu (XAM.AX)). Also, this report from Proactive Investors says there is coal resources of 417 million tonnes indicated and 72 million tonnes inferred. http://bit.ly/vprH0J
17) C@ (CEO.AX) (soon to be Draig Resources) announces the offering price for new shares is A$.50 instead of A$1.00, new timetable, revised prospectus, etc.
19) Mongolia Investment Group (0402.HK) interim report for the half ended September 30, 2011. From page 15, there is a Business Review with a discussion of their mining in Mongolia that begins, "The Mongolian government in recent years has been proactive in encouraging resource-related overseas investments."
20) Asia Coal (0835.HK) interim report for the half ended September 30, 2011. Business review after financials begins on page 13: http://bit.ly/vFk4EV
21) Korean company Synopex has signed a Memo Of Understanding "for the safe water supply of Mongolia" http://bit.ly/sc9MP6
22) Frontier Securities (a local brokerage) CEO Masa Igata on CNBC, November 24, 2011. At 2:20, the following investment opportunities are listed: APIP (raising capital for projects and Hong Kong IPO in 12 to 18 months), FeOre (IPO in Australia soon), Lucky Strike (OTC:LKYSF), Remicon JSC (concrete/cement on the Mongolia Stock Exchange; Frontier is a sponsor of their secondary offering announced Friday), Prophecy Coal (OTCQX:PRPCF), Gobi Coal (pre-IPO financing), YokozunaNET ($3 mill private placement), and Mongolia Growth Group (OTCPK:MNGGF):
23) This article notes Mongolia ranks 120th out of 183 on the Transparency International Corruption Index. http://bit.ly/s32ufw
Here's a full break-down from 2011's report: http://bit.ly/shn1K0
Here's the 2011 home page: http://bit.ly/tcvcYC
24) Khan Investment Management announces the Khan Mongolia Equity Fund.
25) Notes from November, 30, 2011, Mongolia cabinet meeting. The item that jumps out at me: "The cabinet considered results of an official visit of Germany's Chancellor Angela Merkel paid to Mongolia on October 12-13 and then decided to submit the matter to the NSC [National Security Council]" - http://bit.ly/sETgqI
26) Russia says they will cut fuel exports 80% starting December 1. Mongolian government says this is no problem. A refinery being built in Mongolia by Sod Mongol Group gets a mention in this article too. http://bit.ly/s0QqWG
27) Xinhua news agency says Mongolia bank policy will tighten to prevent inflation.http://bit.ly/vXbRcU
28) The IMF says Mongolia's economy is expanding too fast and they need to raise rates to curtail inflation. http://bit.ly/tJp4FI
29) The President of Mongol Bank discusses inflation and bank stability in a print interview: http://bit.ly/sWCGlO
30) This article says the Mongolian Development Bank will issue bonds worth $60 million by the end of the year, primarily for rail infrastructure. I'd wait for confirmation from another news source before buying into this story. http://bit.ly/tXU26r
Or this one that has the number at $600 million. http://bit.ly/vF8okt-
31) 10,000 teachers went on strike about low salaries this past Wednesday:http://bit.ly/rvV8Ac
32) Mongolia's 2012 budget passed in parliament: http://bit.ly/w1pvai
33) A piece on the Canadian International Council website on Mongolia, mining, and sovereignty: http://bit.ly/tIFU6V
34) Jonathan Scott at The Guardian reports on Bogd Khan nature reserve which highlights the construction in the Zaisan valley within the reserve. Structures, including luxury apartments, built in Zaisan are in a grey area now as the reserve techinically should not have been built upon and property rights are strong.http://bit.ly/v12CRB
35) For those considering trading shares on the Mongolia Stock Exchange, I would like to note something I was reminded of this week that is different than you may be accustomed to: secondary offerings on the MSE cause stock prices to go up (not down).
36) Added to the list this of companies at the top this week:
- Prophecy Platinum (PNIKF.PK) (NKL.V), platinum and nickel in Canada, Argentina and Uruguay. This was added as Prophecy Coal has a 42% stake in Prophecy Platinum.
- Modun Resources (MOU.AX) coal, Mongolia (formerly TVN Corporation, TVN.AX)
- Also new, a list of equity funds for investing in Mongolia below the list of stocks. Like the stock lists, I'll add to it as I find more.
5 Dec 2011, 01:04 AMReplyDelete CommentLike5
Valley BoyComments (1422)
There is some concern about the strength of Mongolian apparel manufacturing based on changing trade patterns and climatic risks. A better water supply and favorable trade deals should help the situation.
5 Dec 2011, 12:02 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
December 12, 2011
Weekly Mongolia News Update below. As noted last week, I am periodically including outlooks on China's economy as 80%+ of exports from Mongolia go to China (although Mongolia intends to diversify from that situation). If you see something on China you think is interesting to investors in Mongolia, please post it here.
[The Mongolia Investment Summit in London took place on December 8 and 9 last week (http://bit.ly/rZSzMn). Apologies to followers old and new in the U.K. that I did not get advanced notice to you about this event. If any organizers or attendees of the event are checking in, could you please be sure to send details to the Glasgow University Trading And Investment Club next year, and consideration for a few complimentary invites to a student group interested in investing in Mongolia would I'm sure be appreciated - thank you.]
Here's the weekly news with a story I missed up until now at number 1 and a big arbitration decision at 2:
1) Undur Tolgoi Minerals has just started trading in Canada with the ticker UTM. What got my attention: James Passin of Firebird Funds is the company's Chairman. (If you don't know who James Passin is, and you're investing in Mongolia, you should watch the two video links below - 6 minutes total.) UTM has a 100% owned Copper-Gold-Molybdenum prospect on "9,260 hectares of land approximately 100 km from the famous 'Oyu Tolgoi' copper and gold mine" (quoted from fact sheet). Private placement shares are subject to a four-month lock-up concluding on March 8, 2012, thus the stock will not be very liquid in the interim as only 4.4% of the shares are not subject to this holding period (or 2.2 million out of 52.2 million shares).
- As of December 8, 2011, UTM concluded its CDN$7 million private placement financing: http://mwne.ws/uVzXfC
- Company website: http://bit.ly/vbsw8q
- Corporate presentation: http://bit.ly/tSWO0z
- Fact sheet: http://bit.ly/t2KWWI
- James Passin's other interests listed in corporate presentation: "managing partner and co-founder of Firebird Global Fund, Firebird Global Fund II, Firebird Mongolia Fund and Firebird New Mongolia Fund, Investor in Mongolia since 2005, Director of [the following companies]: National Investment Bank of Mongolia; Sharyn Gol, a coal producer listed on the Mongolian Stock Exchange; BDSec, a Mongolian Broker/dealer and investment bank listed on the Monglian Stock Exchange; and Fluormin PLC, a fluorspar producer listed on AIM; director of several private, venture-stage international resource companies."
- VIDEO 1, interview with James Passin on Reuters from this summer when Vice-President Biden visited Mongolia (worth 3 ½ minutes of your time): http://reut.rs/tIpcaZ
- VIDEO 2 with James Passin on Reuters Insider, 5 reasons to invest in Mongolia (worth 2 ½ minutes of your time): html?cn=uid2482&ci...
2) Oyu Tolgoi related news of the week:
- Reuters reports from Ivanhoe's (IVN) presentation at the Mongolia Investment Summit in London that deputy chairman Peter Meredith expects a ruling in Ivanhoe's arbitration with Rio Tinto (RIO) as early as this week; and "Ivanhoe is still in talks with China over a three or four-year power supply agreement" http://bit.ly/rRRte8
- Because "Ivanhoe Mined Ltd will need to build a new power plant by the summer of 2017 as part of its agreement with the Mongolian government to develop the country's massive Oyu Tolgoi copper-and-gold deposit" http://bit.ly/tS2OYh
- and, implicitly, needs more power from somewhere else in the meantime.
- Prescient call by Mr. Meredith above. While I was gathering up data for this blog, the arbitrator has ruled in favor of Rio Tinto. This article by Bloomberg notes that an agreement preventing Rio Tinto from making a hostile bid for Ivanhoe Mines now expires January 18: http://buswk.co/twdiAn
- Or as Reuters titles it, Rio Tinto Wins Fight Against Ivanhoe Poison Pill:http://reut.rs/tzZgxj
- Most thorough is Canada's Globe And Mail: http://bit.ly/t7DB7z
- And the Sydney Morning Herald is good as well: http://bit.ly/uMpMPc
3) Good week for Erdene Resource Development (OTCPK:ERDCF), part 1. Erdene Resources fills and completes its private placement run by Mongolian investment bank MICC. http://mwne.ws/teeV0x
Chronicle Herald in Canada notices: http://bit.ly/sUDNwx
4) Xanadu Mines (XAM.AX) and Erdene Resource Development (OTCPK:ERDCF). "Xanadu Mines delivers maiden coal Resource of 170Mt at Galshar in Mongolia."
- Proactive Investors: http://bit.ly/tBObmZ
- Company release: http://bit.ly/sz8tvp
- Good week for Erdene Resource Development (OTCPK:ERDCF), part 2. Erdene Resources has a royalty interest in Galshar: http://bit.ly/sWGAE3
9) Haranga Resources (HAR.AX). Chariman Matthew Wood who I detailed in item #14 in the update of December 5, 2011, purchased A$418,334.84 of HAR.AX shares on the open market at an average price of A$.28. http://bit.ly/vK3Bho
10) Guilford Coal (GUF.AX), New JORC Coal Resource, Maiden JORC Coal Resource of 231Mt: http://bit.ly/ue64qk
13) Mongolia Investment Group (0402.HK) has a complex multi-party memo of understanding [MOU]. Notably, the "Target Group" mentioned is a Hong Kong company wholly unrelated to the American company of the same name, and aerial geophysics can be a cost-saving method for mining exploration. http://bit.ly/sIQlyv
14) Robe (ROB.AX), a once dormant company getting into motion. http://bit.ly/tpwja6
15) "Monvest, an entertainment, leisure, and travel [ETL] company, that operates the National Lottery of Mongolia" seeks to become the first Mongolian company to list on the Frankfurt stock exchange: http://bit.ly/vAzlP1
16) Seeking Alpha article by CFA Institute member Usman Hayat on a recent presentation by Yale management professor Zhiwu Chen on "What Explains China's Economic Growth, And Is It Sustainable?" (includes embedded video of Dr. Chen's presentation) http://seekingalpha.co...
17) The UB Post follows up on item #30 from December 5, 2011. "US$600 million equivalent of medium-term Euro bonds" to be issued by state's Mongolian Development Bank "with the assistance of global financial giants such as ING, Deutsche Bank, and HSBC." Scan down the article to the header "After the Fund Raising" for critique from Rogier van den Brink of the World Bank in Mongolia.http://bit.ly/sZEmam
Validation of $600 million as the number being sought comes in the form of Legal News from Australia and New Zealand on the Mayer Brown legal team working on the project: http://bit.ly/tralKv
Mayer Brown's website: http://bit.ly/ueEMMJ
18) The European Bank Of Reconstruction And Development [EBRD] loans $5 million to Gobi JSC, a producer of cashmere and camel wool products. End of the article has the EBRD's total "debt and equity investments [at] more than US$465 million to the Mongolia private sector through 41 projects" since 2006.
19) Water issues in the South Gobi mining district are on the government radar:http://bit.ly/rDC362
20) Data for the first 11 months of the year from the National Statistics Office of Mongolia: http://bit.ly/rK0N4g
21) National Statistics Committee says inflation was 10% in November and tax income has increased 42.2% year over year: http://bit.ly/sGvkxN
22) Banker magazine names Golomt the best bank in Mongolia. http://bit.ly/sa3wWv
23) "Kuwait has a big aspiration to make investments in Mongolia, especially in the fields of infrastructure, mining and agriculture." http://bit.ly/vLZjHA
24) India has offered a $20 million loan to Mongolia for an outsourcing center:http://bit.ly/tc6csL
26) Teachers continue to strike for better wages in Mongolia: http://bit.ly/tbLpX8
27) Random research find of the week -
John Lee, CEO of Prophecy, formerly ran hedge funds (including Golden Omega Fund LP) for Mau Capital Management that invested in mining. Mr. Lee founded Mau in 2004. Prior to Mau, Mr. Lee worked with James Turk. I came across a library of articles he wrote while running funds for Mau: http://bit.ly/tuBfwM
28) Added to the list at the top this week:
28a) Cameco (NYSE:CCJ), uranium, international (note that Centerra Gold was spun off from Cameco in 2004)
28b) Solomon Resources (OTC:SLMZF) (SRB.V), uranium, Canada/USA/Mongolia (micro-cap)
28c) Undur Tolgoi Minerals. UTM in Canada. Details above.
28d) Nomad Mongolia LP, an investment fund for Canadian accredited investors
28e) A long notice that companies may periodically be removed from the list of companies above. Until such time as someone volunteers to cover my potential legal expenses, I will not be discussing the names of companies removed from the list or the reasons they were removed.
29) Travel notes.
29a) I will be traveling December 17 to January 11. Weekly updates should still come out regularly.
29c) Apologies for the delay in the news update this week. A few things I was working on delayed this posting and should be published on Seeking Alpha later this week.
30) In the spirit of Jon Stewart, your 11 second "Moment Of Investment Peace" from newly founded Mongolia Airlines (item 31 from the November 28, 2011, update):http://bit.ly/vOtFap
12 Dec 2011, 11:32 PMReplyDelete CommentLike5
Jon SpringerComments (1373)
In the realm of fast moving parts, the Undur Tolgoi Minerals website, and some of its links mentioned in #1 this week have already changed as the website is now noted to be "under construction." It looked pretty good 90 minutes before I posted the update. My apologies for the broken links. Will update them when available.
Here's another link to James Passin's five reasons to invest in Mongolia (apologies this one comes with a 30 second ad you have to watch before the 2 1/2 minute clip): http://reut.rs/umswXJ
Here's the NI 43-101 link for Undur Tolgoi: http://bit.ly/v5FMad
13 Dec 2011, 12:27 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
Posting opinions from brokerages houses in Mongolia on the Ivanhoe-Rio Tinto decision in item #2. The first one out with an opinion is...
Oliver Belfitt-Nash at Monet Capital
"Rio's latest win against Ivanhoe marks an important step in consolidating Oyu Tolgoi's ownership. As Rio gains the upper hand, the international giant looks to be edging in on Ivanhoe to eventually take control of Mongolia's prize asset. For Mongolia, this may mean the opportunity to deal with one of the most experienced miners in the world - one that has trodden the political/social line well in the past and knows how to placate all parties involved. As elections loom, resource nationalism bubbles in the local psyche, and mining becomes the main topic of political discourse, we believe a stronger international partner will help to smooth any further hitches in the plan such as the one we saw earlier this year. The aggressive young Ivanhoe may well give way to a more diplomatic Rio and for the better, in our opinion."
13 Dec 2011, 08:21 AMReplyDelete CommentLike4
Would you happen to have any contact information for Nomad Mongolia, LP? I would be very interested in working with them as I am planning to do the same with Chinese investors.
13 Dec 2011, 09:46 AMReplyDelete CommentLike2
Jon SpringerComments (1373)
I am working on several interviews, including possibly one with Nomad. As for getting in contact otherwise, I'd recommend going to the hyperlink to Nomad's web page listed above and here - http://bit.ly/v0X0mT - and contacting them directly. Keep in mind that all their funds are focused on Canadian investors.
13 Dec 2011, 03:03 PMReplyDelete CommentLike3
Jon SpringerComments (1373)
Two articles by me about Mongolia up today. One more coming later this week, but as the article on gold is time-sensitve, posting notice now.
What Investors Should Know About Uranium In Mongolia:
Gold Mining Keeps Booming In Mongolia:
Scan Down to the section titled "Newsworthy Notes On Ivanhoe Mines And Rio Tinto As This Article Goes To Press" for more on the Ivanhoe-Rio Tinto ruling including additional commentary from Mr. Belfitt-Nash who was cited above earlier.
Huge KUDOS to the Seeking Alpha editorial staff who turned this article around in less than one hour when I sent them a note via their Fast Track system.
14 Dec 2011, 12:41 PMReplyDelete CommentLike5
What's the price per share on the latest private offering for MNGGF?
18 Dec 2011, 08:58 PMReplyDelete CommentLike2
$3.90 - Scheduled to close this Friday on 12/23/11. I don't think it will drop below $4.00 prior to the end of the private offering window, but it is possible due investors' concern over China's slowdown.
I was informed by Harris that MGG will not be listed in the HKSE due to high fees. He is now focused on listing MGG in the MSE and TNX. I'm actually glad to hear this.
18 Dec 2011, 09:11 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
Greetings OG and Haiguike,
Thanks to both of you for the posts.
OG - Minor clarification, the private placement is in Canadian dollars, thus CAD$3.90 (which is $3.7456 in U.S. dollars at 11pm EST on 12/18/11). I received an e-mail yesterday confirming my participation in the offering which, for the time being, suggests to me that the offering price will not change.
Placement announcement: bit.ly/rXyths
Ke - the idea of listing on the MSE is news to me if that's in the near-term pipeline, although it make sense and is in line with the goals of country (and company) as the London Stock Exchange helps revamp the Mongolia Stock Exchange. (Haiguike met with Harris Kupperman at, and after, the company presentation in NYC last month).
Interesting thought on the Hong Kong Stock Exchange fees being high. Every company has many reasons why it chooses to list where it does, but as can be seen in the stock listings at the top of the page, there is a good contingent of companies who chose the advantages of listing in Hong Kong.
Weekly news update will be up by mid-day Monday New York time.
18 Dec 2011, 10:58 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
December 19, 2011
Welcome to the Mongolian Weekly News Update. As our staff of one's wife is Czech and the people of Mongolia also have long-term good relations with the Czech people, we are flying our metaphorical flags at half-mast today with the passing of Vaclav Havel yesterday (great piece on Havel by John Avlon: http://bit.ly/uwyiDM)
1) Not "news", but the guys at Capitalist Exploits have put out a guide on Mongolia investing this past week. I'll get a long post of some highlights I took away from reading it later in the week. It has interviews with the following folks that are worth reading:
- From APIP: Lee Cashell, Will Tindall, and Jess Lampe
- From the BDSec brokerage house, Dayanbilguun Danzan
- From Firebird Funds, James Passin
- From Mongolia Growth Group, Harris Kupperman
- From the ResCap brokerage house, Eric Zurrin
2) Busy week by me:
- Ivanhoe Mines Share Price: Should It Go Down Like This? http://seekingalpha.co...
- Article on the insurance division of Mongolia Growth Group http://seekingalpha.co...
- Overview of uranium in Mongolia seekingalpha.co...
- Overview of gold in Mongolia seekingalpha.co...
3) Could list 100+ articles about Ivanhoe and Rio Tinto this week.
- This one has Rio Tinto's claim that they will not buy out the company immediately and a BMO analyst with a price target of $24 on IVN. http://bit.ly/sgMaqZ
- Ivanhoe's share price plunges…. http://natpo.st/tQTwOE
- TD Newcrest downgrades Ivanhoe http://bit.ly/srBOlt
- Bloomberg says Rio Tinto Doesn't Plan Ivanhoe Bid http://bloom.bg/scOKWp
- Ivanhoe Mines points out their shareholder rights agreement remains in effect…http://bit.ly/sAPiU4
- To read the rights agreement for yourself go to http://www.sedar.com Then, click "search database" tab at the top. Then click "public company." Then type "Ivanhoe Mines" into the company name section and put April 7, 2010, into the "date from" field and April 23, 2010, in the "date to" field. Click on the report titled, "Management information circular - English" dated April 7. Go to page 31 where you will find the section titled "Shareholder rights plan." Data is on pages 31 to 35, text of the motion that passed is one page in Schedule D at the end of the document and a further four pages of the legal wording of the rights plan is in Schedule E at the end of the document, pages E1 to E4 (schedule D is the equivalent of page 88, and schedule E begins on page 89). When done there, then you can go back to the search page and click on "Material document(s)" dated April 23, 2010, which has the full legal text of the rights plan as amended April 21, 2010 (54 pages). IF I understand correctly: 1) "the Board of Directors can (i) waive the application of the Shareholder rights plan" (p. E4); 2) there are "Permitted Bids" under the rights agreement (p. E3); 3) the germane "right" shareholders have is that, under certain condition, when a takeover bid is made, shareholders will have the right to purchase 2 shares of the company for an amount equivalent to how much the takeover bidder is offering to pay for each 1 (one) share of the company (pgs. 33 - 35, p. E3).
4) Ivanhoe (IVN) Rio Tinto (RIO) joint venture at Oyu Tolgoi still on schedule for production in the second half of 2012 according to this UB Post article on copper (bears mentioning as a lot of media was pushing the date back to the 1st half of 2013 this past week): http://bit.ly/vvGKXG
5) MacMahon Holdings (MCHFF.PK) (MAH.AX) is doing well raising funds for its work on the Tavan Tolgoi coal mine ($475 million and counting). http://bit.ly/rEBGyK
9) Aspire Mining (OTC:ASPXF) (AKM.AX). Monet capital issued a speculative buy on the company with a prices target for its Austrailian shares of A$0.79. Considering the close on Friday December 16, 2011, was $A.30, this in noteworthy. Monet's e-mail notes High Quality Coal, Huge Exploration Upside Potential, and a Strong Shareholder base as drivers for this rating. (No link.)
12) FeOre Limited (FEO.AX), has its successful IPO in Australia. Its primary project is the Ereeny iron ore deposit in Mongolia.
Aiming for their 1st rail haulage of iron ore in 2 years (and has 10-year off-take and logistic agreement with China Railway Group): http://bit.ly/vD1QP4
Trades slightly above it's A$0.25 IPO price at open and has JORC Resources indicated 57.3 million tonnes and inferred 51.4 million tonnes: http://bit.ly/uGNn31
Company site: http://feore.com
13) Guildford Coal (GUF.AX) may be selling off its Terra Energy Mongolia coal division according to this WSJ article on M&A activity being hot in the coal sector in Mongolia: http://bit.ly/rVfvos
14) C@ Limited (CEO.AX) is now Draig Resources. Ticker should change to DRG.
15) Asia Coal (0835.HK) interim results for six months ended September 30, 2011.bit.ly/vFk4EV
16) North Asia Resources (0061.HK) has convertible bond redemptions:http://bit.ly/rXE4j1
17) S&P upgrades Mongolia "to positive from stable." http://bloom.bg/uGlDnw
18) Erdenes MGL Tavan Tolgoi (the government owned "Tavan Tolgoi East" that should IPO in the next year). Short interview transcription of Erdenes MGL Tavan Tolgoi CEO, the President of MICC, and a member of the Mongolia Stock Exchange board: http://bit.ly/s6RUvU
19) Local private conglomerate Newcom (http://www.newcom.mn) is getting $40 million from the International Finance Corporation (an arm of the World Bank) to "help Newcom develop a number of projects across sectors such as renewable energy, transportation, communication, and real estate, contributing to the growth of Mongolia's infrastructure and the diversification of its economy. These projects include increasing the installed power capacity through Mongolia's first grid-connected wind farm and expanding operations of Eznis Airways in the country."http://bit.ly/tgEQcm and http://bit.ly/uV2G2Y (see item 23 from November 21, 2011, for notes on Newcom's joint project with GE on wind energy in Mongolia)
20) Uranium. 107 exploration licenses and 2 exploitation licenses currently issued. Spending on uranium exploration is rising annually, 16 billion Togrog in 2009 ($11.7 million), 25 billion Togrog in 2010 ($18 million), 37 billion Togrog in 2011 ($27 million). http://bit.ly/s2xqYb
21) Japan and Mongolia are accelerating free trade talks. Japan also mentions they hope their companies are considered kindly in the "Tavan Tolgoi West" bidding. (the government is currently accepting bids on the West Tsankhi portion of the Tavan Tolgoi deposit from international consortiums) http://bit.ly/w3NlUT
22) RENAC, Germany's Renewables Academy, working with Mongolia on training programs: http://bit.ly/tF5uTKRENAC's-Global-Educati...
23) Washington Post, "China's Boom Ends As Investment, Exports, Manufacturing Fall" (was differently titled in the Friday WaPo newspaper I read on the plane Saturday as: "China says its era of rapid growth is over." So, which is it? A boom ending into a slow-down (i.e. recession), or a boom slowing down to moderate growth (i.e. still growing, just slower); title can make a difference)
24) Seeking Alpha's Patrick Chovanec (http://bit.ly/sTBZMZ) has been widely quoted this week in Bloomberg, the Washington Post, and on YouTube. Links:
25) Golomt Bank advertising for jobs in the Financial Times (thanks to Bob Johnson who sent me a copy of the ad; if anyone needs the details, send me a message):http://on.ft.com/vou8n3
26) In 2009, half the taxes collected from mining companies came from the joint Mongolian-Russian state-run copper mine of Erdenet Mining Corporation according to a recent audit. http://bit.ly/sPOkUj
27) New election laws passed for Mongolia's parliament, The State Great Khural. For the June 2012 elections, of the 76 parliamentary seats, 48 seats will be direct elections in the 48 electoral districts, and 28 seats will be divided among the political parties based on a proportional system. http://bit.ly/sSgMhK
28) Mongolia's president in the Middle East building business relations:http://bit.ly/vHHCvT
29) Mongolia's National Meat Reserve plans for this winter (meat is a major dietary staple; roughly every eight years there is a severe winter - called a dzud - that wipes out a lot of Mongolia's livestock)
News item: http://bit.ly/sgMAKm
Dzud Wikipedia page definition: http://bit.ly/tr3G3D)
Related (annual livestock census): http://bit.ly/uvcwzY
30) MCS Group (http://www.mcs.mn/en;jsessionid=144BAA6C43... parent company of Mongolia Mining Corporation (MOGLF.PK) created 1,768 jobs in 2011, enough to lead the top ten job creators of the year in a year 72,080 jobs were created in Mongolia. http://bit.ly/sG3oxO
31) Prototype bus rolls out for Erdu LLC, a company planning to produce 100 to 120 busses annually upon completion of a new factory in March. bit.ly/rVfvos
32) Striking teachers -
Still negotiating with the government: http://bit.ly/sAIZY9
Note of support from a member of parliament: http://bit.ly/u1mUlk
Civil Movement supports: http://bit.ly/vMM993
Prime Minister meets representatives of those on strike: http://bit.ly/sJ6MdW
Joined by healthcare workers: http://bit.ly/v7JzJb
Supported by the Civil Will-Green Party: http://bit.ly/tpidjx
As of Decemer 14, 2011, "11,570 teachers from 93 secondary schools and 74 kindergartens have joined the strike that began December 12. They also said 36 unions from local settlements' schools, kindergartens, and training centers have submitted their signatures to support the strike." http://bit.ly/uIdde9
33) Mongolia parliament approves a draft law on decentralization with the goal of reducing population density in Ulan Bator. The idea is to move some services to regional centers. (Under communism, there were more regional and local services (for example, rural local clinics for healthcare). Thus, one of the pressures post-communism on cities, particularly Ulan Bator, has been that when communism ended so too did Soviet support the regional and local services -> which meant public services became centralized -> which meant more people moved closer to those services.) http://bit.ly/ui1PYX
34) China & Mongolia "pledge closer law-enforcement cooperation"http://bit.ly/u73RVT
35) Mongolia is on the radar of a steel producer from India for resources (one mention in whole article, no detail): http://bit.ly/vn7AKh
37) Factoid that may only interest me. Ivanhoe Mines web page has a "The Facts… for the record" page (http://bit.ly/u96vQZ) where they correct reports from the news media. At the top of the page they quote: " 'Mistakes are a fact of life. It is the response to the error that counts.' - Nickki Giovanni." This may be true, but there is no "c" in the name of Ms. Nikki Giovanni, thus Ivanhoe Mines "facts" pages requires a correction itself.
38) The International Energy Agency's report Medium-Term Coal Market Report 2011 can be bought (http://bit.ly/uF5asi), but here is a summary from The Australian which notes global consumption of coal has gone up 70% in the last 10 years:http://bit.ly/vqo0rL
39) This week's Moment of Investment Peace, Jess Lampe of APIP's 3 minute rap song, "UB State of Mind." (text of lyrics is below the video for those who want to sing along). http://bit.ly/rzHZLG
19 Dec 2011, 04:35 AMReplyDelete CommentLike5
Merry X-Mas to you, your family, and all of your avid followers and readers! I look forward to sharing my progress in my upcoming venture with you!
26 Dec 2011, 06:52 PMReplyDelete CommentLike3
Jon SpringerComments (1373)
December 26, 2011
1) Prophecy Coal (OTCQX:PRPCF) -
a) year-end newsletter from CEO John Lee - all good news. http://bit.ly/rushwW
b) and Prophecy Platinum (PNIKF.PK) (about 42% owned by Prophecy Coal) with a note on platinum prices being undervalued http://bit.ly/sfmqDN
2) Mongolia Growth Group (OTCPK:MNGGF) closes private placement after raising CAD$15,000,000. http://bit.ly/tUMtjX
Original offering announcement (they only raised 75% of what they wanted to. Not ideal, but many people are having trouble raising capital in the current environment.):bit.ly/rXyths
3) By contrast, Origo Partners (OPP.L) raises $32.5 million in sudden fashion -
Announcement that there is a private placement in the company 20 December 2011:http://bit.ly/vHR82z
Closing of the private placement 20 December 2011 (same day): http://bit.ly/uf6pd1
4) Mongolia Mining Corporation (MOGLF.PK). If I read this announcement right, parent company MCS has both a long and short position in the company. http://bit.ly/vNp8aq
5) Voyager Resources (OTC:VOYRF), on the heels of last week's good drilling announcement at its KM property notes this week it has increased its stake in the KM property from 50% to 80% http://bit.ly/uKEXdi
6) Aspire Mining (OTC:ASPXF) and Guildford Coal (GUF.AX) are both getting investments from "AUSTRALIA'S richest person, Gina Rinehart, has thrown her weight behind Mongolia's emerging coal industry, spending an estimated $3 million on positions in two companies exploring in the Asian nation." http://bit.ly/sGRvW9
9) Haranga (HAR.AX) is now 7.35% held by the Lippo Group http://bit.ly/rGgq31
11) Winsway (1733.HK), also part of Peabody-Winsway in Mongolia, continues to have its bonds on negative watch from S&P http://bit.ly/uAEwUC
12) C@/Draig (CEO.AX)/(DRG.AX). Stock suspended and not trading until January due to procedural name change stuff. http://bit.ly/umIef3
13) Robe (ROB.AX) monthly report http://bit.ly/uB8Hj8
14) Top 100 taxpayers (no link) in Mongolia, some highlights from the top 20 (thanks to Frontier Securities for the data):
#1 is state-run copper miner Erdenet,
#5 is Oyu Tolgoi (the mine being run by Ivanhoe and Rio Tinto that is not producing yet - this is just taxes on the cap ex to get to production),
#6 is Mongolia Mining Corporation (MOGLF.PK),
#7 is SouthGobi Resources (OTC:SGQRF),
#10 is Leighton (OTCPK:LGTHF),
#15 is Wagner Asia (http://bit.ly/ugZM2J -privately held and official dealer of Caterpillar (NYSE:CAT) equipment in Mongolia),
#17 is Centerra (OTCPK:CAGDF),
#20 is Major Drilling (OTCPK:MJDLF)
16) Government rejects an export tax on coal and iron ore proposed by two members of parliament, "Members said the export tax would make overall taxes too high on companies, which could stifle development in the coal and iron ore sectors, since mining is one of the country's leading economic engines. They said it could also stifle investment in the mining sector." http://bit.ly/tYRTm7
17) Important for companies such as Centerra and Meritus, "A trilateral national committee has released a recommendation on intensifying the realization of the law on prohibiting the exploration and exploitation of mineral resources on reserved lands with sources of rivers, water resources and forest funds." Title of article on Montsame is "RECOMMENDATIONS ISSUED FOR LAW ON SAVING RESERVED LANDS" (December 21, 2011) http://bit.ly/vOBMYV
18) The headline says, "Emerging Asia growth outlook slashed by Fitch" from 7.4% to 6.8%. My headline would read: Emerging Asia still to grow at 6.8% despite Fitch foreseeing a global recession. http://bit.ly/vBdAlQ
19) Khushuut Mining, which is owned by Chinese company Mon En Co LLC, is the subject of questions to the Ministry of Mining. Some are saying the deposit should be added to the list of strategic deposits. http://bit.ly/sbx6ON
20) China announces a new massive coal deposit find of 89.2 billion tonnes of reserves. http://bit.ly/vTzK8K
21) Eurasia Capital brokerage wins three awards for its investment banking in Mongolia. http://bit.ly/tyRoFv
22) More interviewing of Lee Cashell from APIP with the guys at Capitalist Exploitshttp://bit.ly/sdFRX5
23) China's coking coal imports hit 10-month high of 5.1 mil mt in Nov, "Imports from Mongolia, at 2.3 million mt, hit their second-highest month on record, accounting for almost half of all Chinese imports" http://bit.ly/ss8Pq2
24) Mongolia's mining sector keeps growing (particularly coal, oil, gas, and iron ore):http://bit.ly/uiK05l
25) Mongolia Spending Glut Risks Bust On Commodity Outlook, IMF Says (Bloomberg article which fails to mention that the IMF has also been invited to leave Mongolia) http://bloom.bg/tFrGJX
26) Salaries to be raised by the government on February 1 and May 1 this coming year. It seems a deal with the striking teachers bumped their wage increase back from March 1 to February 1. http://bit.ly/vOzZtR
27) 100,000 apartment project still not implemented. Cheap housing promised to be built between 2008 and 2012, still only words. http://bit.ly/uzX5Cs
28) Golomt bank of Mongolia revised to "positive" from "stable" by S&Phttp://reut.rs/uIfFal
29) The Wheels Are Coming Off China's Economy: Gordon Changhttp://yhoo.it/suTWH8
30) Oxford Business Group is positive on Mongolia (English version appears below Mongolian version): http://bit.ly/rQ2h79
31) MoneyWeek blogger giving Mongolia a cautionary positive plug:http://bit.ly/tXxZrU
32) WHO: Air pollution kills 1,600 people in Ulaanbaatar annually http://bit.ly/sS0Kos
Happy Holidays to all !
Next update next year !
The entire staff of Mongolia Weekly Update wishes you all the best in the new calendar year !
26 Dec 2011, 09:42 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
January 2, 2011
2) Prophecy Coal (OTCQX:PRPCF) secures $5 million to advance their Chandgana power plant project (plus another $2 million which is part of an arrangement with Prophecy Platinum (PNIKF.PK)):
4) Entrée Gold (EGI) anticipates over-allotment of recent offering to be exercised resulting in: an additional 1.15 million shares and Rio Tinto (RIO) purchasing 170,455 of them by exercising its pre-emptive rights. http://bit.ly/vZbgrp
7) Haranga (HAR.AX) has lost Credit Suisse as a substantial shareholderhttp://bit.ly/sGUP1T
8) Guilford Coal (GUF.AX) extraordinary general meeting; seems primarily to issue shares to management. http://bit.ly/rzRloE
9) Per capita GDP to grow by 66% in 2012 according to this report on the MPP's 20 year plan. (The MPP is one of two major Mongolia political parties and the presentation of the plan was made by Mongolia's Prime Minister Batbold, also a member of the MPP.) Per article:
- Per capita GDP $3,000 in 2011; expected $5,000 in 2012
10) Uranium. "The Nuclear Energy Authority… says two uranium processing facilities will be built in Dornod aimag (province), and construction preparation work is already underway. The factories will export uranium products to France and Kazakhstan."http://bit.ly/soZcgt
11) Also on uranium from a year-in-review article, "Frontier Research Report Publisher Carlos Andres suggested looking outside the usual sources for investments in an article titled "Uranium and Potash Stocks on the Frontier. 'Emerging and frontier markets provide opportunities to buy high-quality companies at a discount simply because of the perceived risk factor,' he said. 'So we look at places such as Mongolia, which is a resource-rich country that is just beginning to realize the benefits of 20 years of market liberalizing. As a result, foreign direct investment has been steadily increasing, the rich resource endowment is starting to be developed and the country is experiencing historic economic growth.'" http://bit.ly/rI3xsq cited fromhttp://bit.ly/tHtwq7
12) Top 100 tax paying companies of 2011: http://bit.ly/rrP0fc (link to item 14 from last week)
13) Top 5 stock exchanges of 2011 -
1: Venezuela, +80.8%
2: Mongolia, +32.6%
3: Panama, +29.2%
4: Iran, +29.2%
5: Trinidad & Tobago, +19.3%
Or, alternatively, Venezuela was #1 (at 79%) followed by Mongolia and Zambia at #2 and #3 http://bbc.in/s4UG8M
14) Brief summary of mining activity for 2011: http://bit.ly/rBtGRv
15) 112 mines registered in 2011: http://bit.ly/sjrvi2
16) Water. The government's accomplishments and future plans for water in the past and coming year http://bit.ly/sDO3YQ
17) Coal in Mongolia. Doing fine with expectations of increasing demand from Russia and China. http://bit.ly/rRxkiQ
18) Insurance. This article discusses auto accidents in Mongolia: http://bit.ly/uNYU3o
19) Mongol Bank Foreign Currency reserves are $2.7 billion http://bit.ly/tA6yMW
20) Article about Mongolia's anti-corruption agency. The current vice-chair recently "was detained by the United Kingdom and then extradited to Germany for the alleged kidnapping of a 21) Mongolia national in Europe." Nine former employees of the agency have filed a legal complaint "that they were illegally dismissed."http://bit.ly/t2v5ag
21) Central bank holds interest rates at 12.25% http://bit.ly/sfByw7
22) Judicial reform needed in Mongolia, an interview with a leading Mongolian lawyer:http://bit.ly/uEkkNe
23) December 29th was the 100th anniversary of the current Mongolian republic's independence and is a public holiday.
24) Quoting article from Montsame new agency (hyperlinks don't work for Montsame as hyperlinks always revert to Mongolian language) - "NATIONAL COMMITTEE TO BE CHAIRED BY PRIME MINISTER
Ulaanbaatar, Mongolia, December 28 /MONTSAME/ In accordance with a cabinet decision made on Wednesday, a national committee will be chaired by the Prime Minister S.Batbold in responsible for working out a draft decision of the government concerning distribution of benefits for people from the Human Development Fund (HDF) and granting stocks and cash money to citizens.
In a scope of the distribution works MNT 1.5 million for every citizen, the national committee was obliged to discuss an issue on a rule for the handouts for citizens, at a cabinet meeting in January of this year. In addition, the national committee was ordered to create a master plan on training and propaganda on stock exchanges in order to improve knowledge of people about shares."
26) Air pollution has caused cancelled flights to Ulan Bator recently: http://bit.ly/t9sb4f
27) Mongolia's President tries to help curtail alcohol drinking http://bit.ly/vai4BN
28) There is a U.S.-based rock band called Ulan Bator. "After a long-awaited 17 years the alternative rock indie band… released their 2nd CD - Praxeology"
Band website: http://bit.ly/v52S3V
And yes, for your moment of investment peace, you can listen to samples from the album: http://amzn.to/sAnqxX
29) Congratulations to News.mn on winning the Bolor Uzeg award for best website!http://bit.ly/v0aK9h
2 Jan, 02:01 AMReplyDelete CommentLike5
Mercy JimenezComments (573)
Happy New Year, Jon, and many thanks for starting off our year with such a rich list of resources for further research on Mongolia.
2 Jan, 06:50 AMReplyDelete CommentLike4
Valley BoyComments (1422)
Happy New Year everybody!
This pea soup fog has finally burned off, sunlight is shining through rays of gloom, let a new year dawn for peace and prosperity......
2 Jan, 11:52 AMReplyDelete CommentLike2
Joseph L. ShaeferComments (1189)
Re item 13, top markets of 2011...
I can believe 3 of them. But since Iran cannot be independently verified for accuracy and Venezuela cannot be converted from Bolivars to Dollars (and are probably lies, anyway, according to my VZ friends still there, designed for domestic propaganda) that leaves 3 with any credibility -- and vaults Mongolia into first place!
Let this be a harbinger of things to come...
2 Jan, 01:17 PMReplyDelete CommentLike4
I agree. I have more faith in Ben Bernanke than Venezuela's government propped numbers. There is a good reason why we are focused on doing business and investing in Mongolia rather than Venezuela. High risk of nationalization = No thanks. I'd rather take my chances in Burma.
The best currencies to own in 2011 have been the Togrog and the Balboa.
I am even more motivated from #9, which is pushing me to simply drop everything ASAP and go live in UB for an extended period of time first.
2 Jan, 02:07 PMReplyDelete CommentLike2
Joseph L. ShaeferComments (1189)
Interesting that you use Burma as your extreme example, haiguike. I was a US military attache there in the 1990s. I won't touch Burma as an investment theme until the double-dealing, lying, conniving kleptocrats in charge are booted out. Then this land of great beauty, gentle people and massive natural resources will be an amazing opportunity...
2 Jan, 02:36 PMReplyDelete CommentLike2
The same was said about China in 1976 - 1978. The yuan appreciated to 1.50 yuan per dollar during the 1980s and was reevaluated to 8.62 yuan per dollar in 1994. Certainly, it is an extremely high risk investment area, but it has a lot of upside, enough upside to attract Jim Rogers's attention.
Hillary Clinton made a visit to Burma in November 2011. Maybe it's not so different from Nixon's visit to China in 1972, but on a smaller scale. The Chinese are already establishing good relationships with the influential Burmanese.
2 Jan, 03:11 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
Reposting a link to the top 5 stock markets from Trinidad and Tobago's Guardian as the other link broke down: http://preview.tinyurl...
An interesting thing about Mongolia's stock market being #2 (or #1) this year is that it was already #1 last year. We'll see what the next two years bring, as somewhere along the way Oyu Tolgoi will start producing... and then Tavan Tolgoi will come next...
Thanks for the New Year wishes, and my I wish all of you a very happy and joyous new year as well - very glad to have all the participation here to kick off the year too.
2 Jan, 05:19 PMReplyDelete CommentLike4
Joseph L. ShaeferComments (1189)
True about China. They've been supplying Burma with tactical weapons to use against the ethnic minorities there in exchange for natural resources. It serves China well today but I wonder... If or when there is a Burmese spring, how much resentment there will be against China, relegating it well below the US as a viable trading partner?
2 Jan, 04:02 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
January 9, 2012
1) The Economist forecasts Mongolia will have the second fastest growing GDP in 2012 (1st is Libya, and the list from 3 to 10 reads Macau, Angola, Iraq, Niger, Qatar, Uzbekistan, Bhutan and at #10, quite relevant to this blog, China) http://econ.st/ystF0b
2) Entrée Gold (EGI) concludes the over-allotment of its offering. Funds raised to be allocated to its Shivee West project (just a bit west of Oyu Tolgoi) in Mongolia and its Ann Mason site in Nevada http://mwne.ws/AqIwuG
3) Khan Resources (OTC:KHRIF). Next hearing in Canada in the Atomredmetzoloto-Khan case scheduled for January 24, 2012. Details of the various legal issues are in my article on uranium. This is from December 30 and I missed it last week (apologies).http://bit.ly/xLlBpE as it just appeared this week in News.mn http://bit.ly/xQ6cva
5) Mongolia Energy Corp (MOEAF.PK) terminates a transaction in China and will get HK$200 million back. http://bit.ly/wcs9zh
6) China Daye (0661.HK) (new company in this blog). 1,516 page announcement. In the summary, on pages 26 to 33, there is discussion of its mining projects including several in Mongolia (rare earths included). http://bit.ly/xeQvMC
9) Robe (ROB.AX). Questions and responses about recent activities for a company that has traded between 1/2 of 1 Australian cent and 3 Australian cents since July 27, 2011 http://bit.ly/A74BuN
10) Erdenes Tavan Tolgoi (state run "Tavan Tolgoi East") may changes its planned IPO from a three-way Mongolia-HongKong-London to a two-part London-Mongolia IPO. Underlying reason is Hong Kong exchange's regulations don't allow for the government issuing shares to the people of Mongolia in the run-up to the IPO. Albeit, article insinuates the Hong Kong IPO market has been weak for foreign mining related companies. http://on.ft.com/xBjd9m
11) Big news of the week. The Democrat Party (of Mongolia) has decided to leave its grand coalition with the Mongolia People's Party [MPP] with the June elections approaching. The MPP still has a majority. However, a host of ministry and cabinet offices will be vacated if this action is completed although the party official said, "We will work with the Prime Minister until he finds replacements for the ministers and cabinet members from the Democratic Party."
Reuters David Stanway: http://bit.ly/zUH1Qu
Moreover, the Prime Minister responds that the contract making the coalition (from 2008) is supposed to run through the next elections (this June). http://bit.ly/wTd9fa
Meanwhile, the Democratic Party answers questions about its decision to leave the coalition and adds that the decision is not final until after a committee meeting (thus, there's an option to reverse a decision that seems final) http://bit.ly/yUg5rq
As the news wonders who will fill the possible vacancies: http://bit.ly/xWPB9p
And members of the government react (this is quite a good spectrum of reactions from ministers and MPs): http://bit.ly/xa9Xyf
12) An open letter to the government from the departing London Stock Exchange rep to the Mongolia Stock Exchange. He discusses the problem of the "Tavan Tolgoi East" IPO (which he believes is slated for March) while the government is not scheduled to consider revising Mongolia's securities law until April. (one might also think this all happening in an election year could become an issue) http://bit.ly/AvLia8
13) Mining licenses. A ban on mining license issuance ends. http://bit.ly/xB6qF1
But, a review of licenses granted in "agricultural, forest, and state protected areas" could reduce the total area covered by licenses by up to 10 percenthttp://bit.ly/yx3QoU
14) BDSec (brokerage) gets award for "Best Underwriter of The Year" and "Entrepreneur of the Year" in Mongolia. http://bit.ly/yhLJHN
15) Rare earths. A member of parliament is making inquiries about who is in charge of developing Mongolia's rare earth resources. http://bit.ly/wBguqb
16) Renewable Energy. A Bloomberg article about Mongolian conglomerate Newcom discusses Mongolia's potential generation of wind, solar, hydropower, and geothermal energy. The article states a potential of 2.6 million megawatts, "seven times the capacity of all the world's operable nuclear reactors combined." Newcom is in partnership with GE (NYSE:GE). http://bloom.bg/Ab2oVl
18) Meat. Like the U.S. has a strategic oil reserve, Mongolia has a strategic meat reserve (because meat is an important staple of the diet, and roughly once every 8 years there is a severe winter (called a "dzud" or "dzug") that wipes out a lot of livestock. Some of the reserve meat is going on sale 15 January. http://bit.ly/xjmfCs
19) Meat, just a thought (no link). Chinese meat has been represented to me as often of low quality. Japanese meat post-Fukushima is not something most people want to eat. There is opportunity for Mongolia to expand its meat exports at this time (per my understanding, currently most of the meat Mongolia exports goes to Russia and the Middle East, so expansion into Asian markets with the removal of Japanese meat from the competition seems reasonable).
20) Not only was Mongolia the 2nd best performing market globally in 2011; it was also one among roughly 15% of markets that finished in positive territory last year.http://bit.ly/yzsFh8
21) China helping finance Mongolia-based frontier service along the Mongolia-China border http://bit.ly/AgqelG
22) Road & tranportation sector created 3,000 jobs in 2011. http://bit.ly/ybh6Xh
23) 20 "ninja miners" working in unlicensed mines are thought to have died in 2011http://bit.ly/weVnby
24) Change is coming this year in China (political transitions; no Axelrod/Plouffe productions): http://bbc.in/xA9BYy
25) Amnesty International thinks Mongolia is making progress as they moved toward abolishing the death penalty http://bit.ly/yCGG7r
While Mongolia and the United National Development Program agree to work together to improve human rights in Mongolia http://bit.ly/yIDpbS
26) Wrestling. An article from this past week notes that Mongolia indeed set the record for the largest wrestling tournament ever with 6,002 competitors back in Septemberhttp://bit.ly/AAHf42
27) The government focus for 2012 is family development. http://bit.ly/xvATIz
9 Jan, 04:48 AMReplyDelete CommentLike4
#4 It isn't surprising and it has been one of the main factors I have been concerned about if I were to start a labor intensive company in Mongolia. Is it true that it is practically impossible to lay off a bad employee in Mongolia?
#18 & #19 - It is very interesting that you bring meat up. Meat along with other resources such as cashmere/furs, dairy, and gold are some of the sectors that I plan to look into when I visit Mongolia. I'm certain Mongolia still uses traditional farming methods, so the meat and dairy from Mongolia can be sold as authentic "organic" products in China, which is in tremendous demand given the awful quality in the food supply chain quality in China. I did not know that most meat were exported to Russia and the Middle East. I have not thought about Japan either. I will definitely jot this down as one of the topics to discuss with you in person.
#24 - I have a lot of confidence in Xi Jinping. He's a brilliant diplomat and pro business friendly economic policies (as his father was). Hopefully he will be able to strengthen the relationship between the resource-rich Mongolia and the business-friendly China.
#26 - That's a lot of huge Mongolians. The NBA is trying to promote pro basketball in Mongolia already. I think the UFC (Ultimate Fighting Championship) would do extremely well there.
9 Jan, 10:35 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
January 16, 2012
Keep in mind, January 18, 2012, is when Rio Tinto (RIO) can ostensibly buy more shares of Ivanhoe Mines (IVN) after the recent arbitration ruling last month. However, other aspects of Ivanhoe Mines shareholder agreement that are in place through April 2013 may give Rio Tinto pause, along with other legal and pricing considerations.
This week's update is a bit heavy on the political end as: the Democrat Party has left the coalition government with the MPP; maneuvers toward the June elections continues; the currency (Togrog/Tugrik) has been declining recently; gasoline prices have been going up.
Numbers 30 to 32 are on China. The rest is Mongolia.
1) Mongolia Mining Corporation (MOGLF.PK) notes that in conjunction with Erdenes MGL (the state-run mining company that own Tavan Tolgoi), they have "completed an expansion project of border crossing capacity" at the nearby Chinese border. MOGLF.PK benefits from its mine being next to the giant state-run coal mine and several other coal mines. http://bit.ly/zfuBrF
2) Entrée Gold (EGI)
- "Discovers New High Grade Gold Zone at Shivee West." More exploration in the area in 2012 to follow. http://yhoo.it/zEE8tA
- And, Director Peter Meredith bought 100,000 shares on the open market at an average price of CAD$1.25. http://bit.ly/xDoTXn
3) Kincora Copper (OTC:BZDLF) (KCC.V) has a letter of intent to acquire property adjacent to its own near Oyu Tolgoi. The structure of the acquisition creates a CAD$6 million offering, with participants receiving one share at CAD$.35 and one warrant (the warrant to allow holders to acquire another share at CAD$.50 within 24 months).http://mwne.ws/zkjDPO
5) Meritus Minerals (OTC:MERMF) (MER.V) completes an offering that raises CAD$205,000. According to a note by brokerage Monet Capital from last year, "Meritus Minerals is a gold explorer in Mongolia. The grades returned from drilling are very high and the company is well set to move to the next stage. However, risks from the Mongolian Law on Forests and Rivers has put the Gutain Davaa license under scrutiny and as such investors are being very wary. We believe the future of this company could be prosperous depending on the future of Mongolian legal system."
- Completion of offering announcement: http://bit.ly/z4mi48
- March 2011 Monet research report on Meritus: http://bit.ly/A6MX3i
9) Erdenes MGL Tavan Tolgoi ("Tavan Tolgoi East") IPO slated May in London and Mongolia only per this Reuters article. http://bit.ly/wuJqAa
10) New company. Altan Rio (AMO.V) in Canada. Copper-gold in Mongolia.
Website - http://altanrio.com
- January 11, 2012, closes CAD$1 million financing, completion of qualifying transaction, consolidation & name change: http://bit.ly/y5jVCy
- January 12, 2012, provides update on its drilling and ownership: http://bit.ly/x2cgg9
11) Cougar Energy Australia (CXY.AX) updates on its Underground Coal Gasification business in Asia (China, Mongolia, Indonesia & Pakistan). http://bit.ly/xxlPBi
12) North Asia Resources (0061.HK). China Construction Bank increases stake by more than 50% of outstanding shares. If this announcement is right, the bank now owns 138.19% of outstanding shares. Anyone who can explain or elaborate on this, please do. http://bit.ly/yI6uTi
13) Mongolia Stock Exchange [MSE] and the election year. The MSE Top 20 index dropped 3.78% last week. This was partially related to the Democrat Party withdrawing from its participation in the government and ending the grand coalition in the run-up to the June 2012 elections. Asia Pacific Securities brokerage anticipates a rough go for the Mongolian markets until the 2012 elections are completed (no link).
14) Related to MSE performance, an update on the Origo-ResCap Mongolia Stock Exchange Liquidity Fund for December 2011 is in the second to last item (no link).
15) The first municipal bond to trade on the MSE, the Sukhbaatar Bond, led by BDSec. 12-18 months. Coupon 12% to 12.5%. http://www.bdsec.mn
16) Worth reading at least page 2 of this report from Dale Choi at Frontier Securities for another local brokerage's current outlook on Mongolia. http://bit.ly/AkPjFR
17) Coal (and copper and iron). Estimates on coal exports from Mongolia for 2012 ranger from 24 to 30 million tons. Coal is 45% of annual exports and worth about $2 billion currently. Frontier Securities estimates $1 billion in copper exports and $500 million of iron ore exports this year. http://bit.ly/A2iHMh
18) Growth and inflation. World Bank & IMF estimate 2012 economic growth of 15.1% and inflation of 17%. bit.ly/A2iHMh
19) National Statistics Office of Mongolia. January 13, 2012, report on social and economic situation. 17% GDP growth last year in 2011. http://bit.ly/yRFm2f
21) Regarding the Democrats resigning from the grand coalition leaving the MPP solely in power:
a) MPP to meet every day until ministry positions are filled and new government is formed http://bit.ly/A9V2ZY
b) The Democrat Party [DP] doesn't want to discuss social welfare issues until after the election per this article http://bit.ly/wja9Br
c) DP minister resignations were submitted January 12 http://bit.ly/yxpinT
d) National meeting of DP approves pulling out from the government January 12http://bit.ly/x5y5ef
e) Six ministers and seven deputy ministers to exit http://bit.ly/zPGqNn
f) DP states positive and negative aspects of their grand coalition as they break ties with the MPP-led government. The negatives: "democratic values have eroded, people's living standards have not improved, judicial reform and anti-corruption efforts have stalled, and justice has not been fully established. In addition, the Government has not commenced construction of 100,000 apartments, new roads, and new railways, even though all necessary measures have been passed. Therefore, the DP has made the political decision to pull out of the coalition government to promote the people's common interests. DP members support the party's decision to pull out of the coalition government." http://bit.ly/wzorGV
g) MPP minister claims 82% of grand coalition projects have been implemented.http://bit.ly/zY9dXu
h) MPP caucus chairman points out the cost of everything has gone up and the Tugrik has gone down in value since the DP left the government http://bit.ly/A3XVdS
i) President Elbegdorj, a DP member who was directly elected in 2009 makes suggestions to the Prime Minister, a MPP member selected his party to lead the country when they won elections in 2008. http://bit.ly/y6ETob
22) Inflation. Up 2% month over month from Nov 2011 to Dec 2011. 10.2% year over year from Dec 2010 to Dec 2011. Food and water responsible for 35% to 40% of the inflation. Energy prices, particularly petroleum, are also on the rise. http://bit.ly/wySeNt
23) Petroleum prices go up, finger pointing ensues.
a) The Authority for Fair Competition and Consumers (AFCC) blames importers. Importers say AFCC is wrong and blame the government. Discussion of "monopoly" of importers and changing that - as with any proposed change, doubtful anything changes before the elections. http://bit.ly/yyN4CG
b) Petroleum importers facing fines of MNT 20 billion ($14 million). http://bit.ly/yNRTJL
c) This article insinuates that the MPP is blaming the DP leaving the government for rising petroleum prices bit.ly/x5y5ef
d) While this article on Chinese-Mongolian relations notes "that working groups of the nations need to achieve more active progress to conclude contract on stable and long-term supply of petroleum products and construct an oil refinery in Mongolia, along a memorandum on cooperation extension in oil sector." http://bit.ly/wDw1gj
e) Another article guessing at the cause in the rise of gasoline prices. Includes perspective from three local oil distributors: Just Oil, Petrovis, and Sod Mongol Group (other fuel importers include MT-Oil and Shunkhlai). Russia's new petroleum export tax is among the possibly causes listed. http://bit.ly/yxChym
f) Prime Minister Batbold (who is in the MPP) says folks will be accountable for the petroleum price rise and says companies involved could have their import licenses suspended or revoked if they conspired to raise prices. http://bit.ly/y7wpw3
24) Mongol Bank President blamed.
a) 20 Members of Parliament as well as the Democrat Party caucus have called for the resignation of Mongol Bank President L. Purevdorj and blamed him for the Tugrik's recent fall against the U.S. dollar. http://bit.ly/xvlAlu
b) Meanwhile, the Confederation of Trade Unions (NYSE:CTU), the United Association for Consumer Rights Protection, and a member of parliament threaten to take the Mongol Bank and its president to court over the Tugrik's decline. http://bit.ly/xVSoEm
c) The Bank's President blames the foreign trade imbalance, the global economic crisis, and warns about inflation. http://bit.ly/yyIWph
d) The Bank of Mongolia tried to intervene in currency markets this past Friday for the betterment of the Togrog. http://bit.ly/zeiT2U
e) The Tugrik is at a 22-month low and has a few dynamics working against it currently, however this article by Xinhua also mentions that price movements in the currency are sometimes seasonal, and the currency tends to underperform in winter (when many construction projects stop due to cold temperatures; and foreign investors repatriate funds (for end of year accounting?)) http://bit.ly/x7osjp
25) Interview with Golomt Bank Vice President Mr. Gankhuyag about the stability of the Mongolian Tugrog. http://bit.ly/xBC83G
26) Control of price & rates.
a) A council is being formed to discuss how to regulate prices of gasoline, food, public transit, and the currency exchange rate. http://bit.ly/znBTJ9
b) Discussions to curb inflation include the idea of selling U.S. dollars to buy foreign petroleum to theoretically improve the U.S.-Tugrog exchange rate and lower gas prices. http://bit.ly/xDtCWy
27) A Brookings Institute article on Mongolia which focuses primarily on the Human Development Fund, and its role in hopefully stabilizing the economy.
- The article was written by the President of the U.S. Mongolia Advisory Group (http://bit.ly/x3YpgC), Alicia J. Campi (http://bit.ly/x0sc8s), who also runs the charitable Chinggis Khan Foundation (http://bit.ly/AqPIu9)
28) An optimistic blurb on "How's Mongolia Managing" touts the Human Development Fund as helping Mongolia sidestep the "resource curse." Institutional Investor Magazine: http://bit.ly/xW2vKv
29) Mongolia asks China for help with fuel shortages. http://bit.ly/yldCOn
30) China. Turbulent times expected for China ahead in this article that predicts:
a) "Reports of the death of American economic primacy are exaggerated, as are expectations of future Chinese dominance."
b) "The global economy is teetering toward another hard landing in 2012. And from these 'ashes' it is the American Phoenix that will rise."
31) Chinese economy slows. GDP growing at 8.7% year over year is the slowest growth China has had in 2 ½ years. http://bloom.bg/xCXqVY
32) If China's slowing down... Well, there is this Bloomberg article about how Australia is on the verge of a $115 billion infrastructure boom "to feed China's and India's appetite for coal and iron ore." http://bloom.bg/x6GiW6
33) Meat (in Mongolia)
a) Following up on items 18 & 19 from last week, a lengthy article about meat's potential in Mongolia from the Oxford Business Group http://bit.ly/AhdhN3
b) Release of strategic meat reserves mentioned in last week's update leads to fall in meat prices this week. http://bit.ly/ycSl4z
34) Mining and the environment. There was a forum discussing the relationship between mining and the environment which included several prominent members of parliament. Unclear that anything was accomplished beyond kind words.http://bit.ly/A9gXO1
35) Mongolia's Constitution turned 20 years old this past week. http://bit.ly/zgjdrc
36) Mongolia's mining sector turns 90 later this year. The ministry of Mineral Resources and Energy "is planning to hold conferences on the following themes: "Mongolia and Spar," "Facing Problems of Infrastructure Development in the Mining Sector," "Coal Export: Market, Price, Quality, and Transportation," and "Metal Processing and its Positive Effects." The ministry will also launch a website to promote the mining sector, and organize a forum under the president's sponsorship at the end of the year." http://bit.ly/x33Iqu
37) U.S. Department of State has a new "Background Note" on Mongolia for 2012.http://1.usa.gov/x6cmwt
38) Nomad Green. An environmentalist blog on concerns about Ulan Bator.http://bit.ly/AzDwah
39) This article on Coca-Cola in Mongolia points out that in the winter "You can deliver Coke colder off the back of a truck than out of a cooler." Local conglomerate MCS is Coca-Cola's local bottling partner. MCS is also the parent company of Mongolia Mining Corporation (MOGLF.PK). Here's the Coca-Cola article:http://bit.ly/wfHlOg
40) Six people arrested in Japan for setting up a fraudulent fund for investing in Mongolia in 2009. http://bit.ly/y2SXwK
41) Origo-ResCap Mongolia Stock Exchange Liquidity Fund, December 2011 Update
The MSE (Mongolia) Liquidity Fund posted a return of 0.7% for the month of December 2011 (8.3% annualized), and 2.3% since inception of the fund (9.4% annualized) in October 2011. Foreseeing the short-term volatility in the markets, we have retained majority of the portfolio in the USD savings accounts and selectively invested into equities. While the equity portion of portfolio performed strongly in the local currency terms (up 8% for the month in MNT terms), the return was negatively impacted by a rapidly strengthening USD this month, resulting in the equities portfolio ending the month up 4.1% in USD terms.
We are continuing meeting with management teams and assessing opportunities with established businesses at discounted entry prices. We have made significant progress in due diligence of a mining related services company, where we have negotiated an entry price at sub 2x P/E with the company, in return for financial and marketing expertise the MSE Liquidity Fund would bring in as a shareholder. We expect the volatility in the lead up to the elections in June to create some distortions in the market, which may serve as terrific entry points, as we continue to identify opportunities through our on-the-ground presence.
The MSE Liquidity Fund is an open-ended investment fund accessing the top companies on the Mongolian Stock Exchange and high interest savings deposit rates at the leading Mongolian commercial banks. The Fund is exposed to the Mongolian Tugrik. This is the first investment product for international investors to take direct advantage of these opportunities in one combined offering.
42) Don't know about you, but after all that, I need a moment of investing peace, and here is a sample of the band Hanggai to do the trick (video and article):http://bit.ly/xEec9m
16 Jan, 03:28 PMReplyDelete CommentLike6
Jon SpringerComments (1373)
Ivanhoe Mines (IVN) shares not moving much (today - January 18 - is the day part of the poison pill against a Rio Tinto buyout expired). This is the big news of the day on the company. http://yhoo.it/wLVaWV
18 Jan, 02:43 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
Ivanhoe Mines (IVN) inter-week update 2.
"Ivanhoe will recommend investors vote to end the rights plan at its annual meeting on May 11, the Vancouver-based company said yesterday in a statement. Rio has been restricted to holding a 49 percent stake in Ivanhoe by a standstill agreement, which was set to expire yesterday, Ivanhoe said."
Full article: http://bloom.bg/A6aacz
18 Jan, 11:53 PMReplyDelete CommentLike1
Another update on Ivanhoe and Rio:http://bit.ly/wn2ZcK
<Rio's preference, they said, is most likely to lie with a friendly deal with Ivanhoe directors to give Rio control of Oyu Tolgoi in a cash and share swap, leaving behind Ivanhoe's other assets, including stakes in coal miner South Gobi Resources, Ivanhoe Mine Australia and Kazakh project Kyzyl Gold.
Credit Suisse analysts valued the 66 percent stake in Oyu Tolgoi at $13.3 billion in a note earlier this week.>
19 Jan, 01:30 PMReplyDelete CommentLike3
Jon SpringerComments (1373)
Thanks OG. Here's the Reuters link to the same:http://reut.rs/w5DnLk
Article at one point says Rio Tinto would buy more and take ownership over 50%, and later there is the above quote. If Rio is only going to take on Oyu Tolgoi and leave the rest behind, there's no reason to go above its current ownership level.
19 Jan, 04:07 PMReplyDelete CommentLike2
Jon SpringerComments (1373)
And, by the by, Ivanhoe Mines' total market cap at the close today was $14.31 billion... kind of an interesting data point off that Credit Suisse valuation.
Then, SouthGobi (OTC:SGQRF) after a tough few months, has a market cap of $1.08 billion as of today, and Ivanhoe owns 58%.
Ivanhoe Australia (OTC:IVHOF) is also value at a little over $1 billion and Ivanhoe Mines owns 59%.
And then, they own 50% of Altynalmas, which is the Kzyl project in Kyrgzsatn.
(Ivanhoe at a glance) http://bit.ly/y1K4Vg
And that list does not include other exploration projects - http://bit.ly/xDKqwz.
One exploration project I'll be interested in the fate of in all this is the Ulaan Khud North, which is a 50/50 joint project with BHP, just north of Oyu Tolgoihttp://seekingalpha.co...
19 Jan, 04:45 PMReplyDelete CommentLike3
Re: Erdene and gold in Mongolia
19 Jan, 01:38 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
Up over 60% today at 3:30pm after being down more than 80% from its highs.
52 week high: $1.75
52 week low: $.32
Good news for those who participated in there $.40 offering through MICC in Mongolia in December.
Maps and such of where Altan Nar is are in this article by me from December:seekingalpha.co...
Congrats to shareholders and management on a good day.
19 Jan, 04:18 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
Winsway (1733.HK) and Peabody (BTU) and Marubeni (OTCPK:MARUF) (OTCPK:MARUY) holders should be aware that Winsway shares were hit by allegations that their public data was wrong today. Winsway has various partnerships with the other two companies. Winsway losses moderated to less than 6% as they clarified their position during the trading day in Hong Kong. http://bloom.bg/zoNJSt
20 Jan, 06:38 AMReplyDelete CommentLike3
Mercy JimenezComments (573)
Thanks for the heads up, Jon.
20 Jan, 08:33 AMReplyDelete CommentLike2
Jason RyanComments (4)
Can anyone recommend some brokerages in the US where I can buy shares in MNGGF.PK? Im currently using Interactive Brokers but they dont show MNGGF on their Pink Sheets nor do they offer investing in CNSX, so I cant buy shares of YAK.
20 Jan, 08:43 AMReplyDelete CommentLike2
Charles Schwab (http://www.schwab.com) allows me to buy MNGGF although I do not own any right now. I would still recommend scottrade and tradeking over schwab though.
20 Jan, 08:49 AMReplyDelete CommentLike2
I've bought MNGGF.PK via Just2Trade for USD 2.5 commission, but the transaction causes later an additional USD 75 "international settlement fee" being charged. Ouch! This seems to come from their clearing house, Legent Clearing LLC and applies to some foreign companies. I've understood 5 letter tickers ending with F are potentially subject to these and at least MNGGF.PK and SGQRF.PK are.
Wasn't there a plan for YAK to be listed at TSX?
20 Jan, 10:05 AMReplyDelete CommentLike2
From what I was told a month ago, MGG's next listing will be the TSX, then the MSE.
Thanks for the heads up on the additional fee. I think I would much rather buy MGG through the MSE once I move there in the middle of this year.
20 Jan, 10:12 AMReplyDelete CommentLike2
Jon SpringerComments (1373)
Fidelity allows you to trade MNGGF.PK. Fidelity fees are a bit higher than the cheapest, however Fidelity also offers trading in the following markets: Australia, Belgium, Canada, France, Germany, Hong Kong, Italy, Japan, Mexico, Netherlands, New Zealand, Norway, Portugal, Singapore, Sweden, Switzerland, United Kingdom (fees vary by country).
There are plans to up-list YAK in Canada. No specific word on when yet. I imagine sometime this year.
20 Jan, 11:05 AMReplyDelete CommentLike4
This page says the foreign settlement fee occurs when Canadian company hasn't registered itself with SEC: http://bit.ly/zn3Z4I
This refers to SEC search page: http://bit.ly/xSn70Y
This mentions the 5 letter ending with Y of F general rule: http://bit.ly/AjYs3b
20 Jan, 12:56 PMReplyDelete CommentLike3
Jason RyanComments (4)
Thanks for the recommendations. Any particular reason why you prefer Scottrade or the others to Schwab?
20 Jan, 10:43 AMReplyDelete CommentLike2
Valley BoyComments (1422)
Some trade shows in the United States may be of particular interest to Mongolians in the opinion of the American embassy.
21 Jan, 10:01 PMReplyDelete CommentLike3
Valley BoyComments (1422)
A look back:
The Mongolian Consulate in San Francisco opened last June. This event should be strengthening the California- Mongolia trade agreement of 2006 despite our lackluster economy. Future news stories about this trade connection will sure to be researched.
21 Jan, 10:27 PMReplyDelete CommentLike3
Thanks Valley Boy. It is great to hear that two Californian firms are building a hospital in Ulaanbaatar with state-of-the-art technology. There are many pharmaceutical and medical device companies in California; they should be planning ahead to gain entry into the Mongolian market.
The Trade Show is very interesting as well. Mongolia could use more competition in concrete, beauty products, night clubs, hotels, and the overall service industry.
22 Jan, 05:18 PMReplyDelete CommentLike2
Valley BoyComments (1422)
California is helping to publicize Mongolia's cultural contributions, too. That should help facilitate business connections between the two regions over time.
23 Jan, 02:45 PMReplyDelete CommentLike3
Valley BoyComments (1422)
Californians might be able to do some business with irrigation technologies in Mongolia, come to think of it, if they are not already there.
24 Jan, 02:07 AMReplyDelete CommentLike1
Jon SpringerComments (1373)
January 23, 2012
1) Before stocks, the Economist has a long article about Mongolia. Questions about water at Oyu Tolgoi answered. Quite positive article. (My main critique would be the article overplays the relevance of Tsetsegee Munkhbayar - although he is the face of resistance to mining development for westerners because of winning an international award in the past for his environmentalism, there are more nuanced sentiments among the public at large that do not like the negative impacts of the mining industry; and I found minimal support for him among locals.) http://econ.st/xl8icF
2) Prophecy Coal (OTCQX:PRPCF) (PCY.V). Feasibility study on the Chandgana power plant is good, "an after tax internal rate of return [IRR] of 21.9 percent from the project." Small incremental rises in the price of electricity would increase the IRR substantially, "a $0.005 kWh, or 8.3 percent tariff hike from base case would increase the project's IRR to 24.8 percent"
Internal Rate of Return definition: http://bit.ly/ytSpxL
3) SouthGobi (OTC:SGQRF) (SGQ.TO) 58% year over year increase in coal sales, meeting its guidance with sales of 4 million tonnes of coal. [also keep in mind above inter-week news about Ivanhoe and Rio Tinto that will have an effect on SouthGobi down the road] http://bit.ly/wheFoF
4) Mongolia Mining Corporation (MOGLF.PK) (0975.HK). A company subsidiary has expanded the number of roads at the Chinese border crossing from 4 to 12 in the last 7 months. http://bit.ly/zVUccr
5) Research report briefing from Ocean Equities available includes Haranga (HAR.AX) (p. 22), Kincora Copper (OTC:BZDLF) (KCC.V) (p. 24), and Voyager Resources (OTC:VOYRF) (VOR.AX) (p. 39).http://bit.ly/zhfRyA~%20OEL%20Year%20Ahead...
7) More on Erdene Resources (OTCPK:ERDCF) (ERD.TO). After its great results (bit.ly/wbkEnA), the company is reviewing capital structures and considering spinning off its Mongolia assets.
Company announcement: http://mwne.ws/yUVGyn
9) Oyu Tolgoi. Ivanhoe (IVN) / Rio Tinto (RIO).
a) Working on the project: 15,000 employees; 65 companies from 38 countries. Also, President of Mongolia visits. http://bit.ly/xBxdMB
b) Frontier Securities notes that according to a Government of Mongolia cabinet meeting, $72 million will be spent to build a town to house 3,000 families (or 12,000 people) near the Oyu Tolgoi site. (no link)
c) Proactive investors on Ivanhoe cancelling their poison pill May 11th.http://bit.ly/wHtPhI
d) Reuters reut.rs/w5DnLk
12) Centerra Gold (OTCPK:CAGDF) (CG.TO). Reports gold production for 2011 and gives 2012 guidance. "At Gatsuurt, the project is ready to begin mining the oxide ore on receipt of the final approvals and regulatory commissioning." Of a worldwide total of $45 million in 2012 exploration expenditures, " In Mongolia, $8 million is allocated for exploration programs and work will continue along the Onon trend in eastern Mongolia and to follow up on the positive results on the Altan Tsagaan Ovoo ("ATO") project." http://bit.ly/AdLyHD
But, "Centerra said pending discussion of the water and forest law amendment in the Mongolian parliament made it difficult to predict the timing of the start of production at the Gatsuurt project." http://bit.ly/ztTiDS
13) Nova Resources (NOVA.L) (formerly Tembusu) has a contract to transport coal for Mongolia Mining Corporation (MOGLF.PK). "Contract could exceed $20 million." Company opened its name change price on January 9, 2012, at 3.25; saw a high of 9.62 one week later on January 16. http://bit.ly/x2gI1j
14) Draig Resources (DRG.AX) completes geophysics work on mining licenses.http://bit.ly/y6Qxvk
15) Blina Mineral (BDI.AX) raised A$740,000 in their recent private placement.http://bit.ly/zStwfd
16) Xanadu (XAM.AX) acquires two copper-gold exploration licenses 110 km northeast of Oyu Tolgoi. Xanadu was previously focused on coal in Mongolia and the market did not react positively to this diversification initially. (remember that Xanadu's Galshar coal mine owes a royalty fee to Erdene Resources, the prior owner)http://bit.ly/wXKZ21
17) Global Met Coal (OTC:GBAUF) (GMZ.V). Initial NI-43-101 complete.http://bit.ly/yqWDtr [Please note this company is not listed at the top and will not be added at this time due to insufficient public data. The company has no website despite engaging an investor relations consultant in November 2011 http://bit.ly/x087H9]
18) Blue Zen Memorial Parks (OTC:DNYFF) (BZM in Canada). Company indicates its purchasing mining interests in Mongolia. Also doesn't have a website. Also will not be listed at top. http://bit.ly/xdVxCZ
19) MarketWatch is now picking up news items on Mongolia Stock Exchange stocks. Berkh Uul JSC makes news with its drilling results http://bit.ly/xHvIYS
20) Tavan Tolgoi.
a) Frontier Securites CEO and founder Masa Igata is concerned that the IPO for Tavan Tolgoi is being rushed because it is an election year and may, as a result, be mishandled. Also, he thinks the value of the IPO would increase by about 66% if the government waited one more year. Important concerns, well stated by the former Salomon Brothers executive in this interview: http://bit.ly/zqX7qS
b) And Masa Igata again in this expository post on his company's website:http://bit.ly/AmsssR
c) Interesting article on the drama around the upcoming IPO for the state-run coal mine (title is incorrect based on recent data, but content is well researched).http://bit.ly/z8t3J8
d) The WSJ writes the IPO is slated for June: http://on.wsj.com/z7XxzA
21) Pitfalls and prospects of the natural resources boom in Mongolia. This is a thorough look at the range of societal impact the boom could have, good and bad. Recommended reading. http://bit.ly/A4czf4-"resource-curse"-in-m...
22) Data debate: inflation and growth. The National Statistics Committee [NSC] disagrees with assessments by the Bank of Mongolia and the World Bank. Bank of Mongolia has inflation at 11.6%, but National Statistics Committee says its 6.7%. NSC says "foreign experts claim citizens' living standards have worsened despite the economic growth. But the NSC says it has found that living standards are improving due to economic growth." NSC estimates economic growth at 17%. More in article.http://bit.ly/AilCFN
23) Analysis of import/export data from the National Statistics Office of Mongolia by Dale Choi at Frontier Securities. Among the highlights, truck imports doubled "possibly reflecting booming coal transportation" (and I might add… possibly increasing gasoline demand leading to higher prices) http://bit.ly/z3PwGI
24) Mongolia Stock Exchange 2011 report. $1.4 million in bonds sold in 2011. $165 million in equity transactions in 2011. http://bit.ly/A601Ug
25) New ministers. After all DP ministers resigned:
a) MPP caucus nominates new ministers http://bit.ly/yQRFtu
b) And the nominations go to standing committee in the parliament: http://bit.ly/w2899b
c) And Prime Minister Batbold submits the names of nominees to President Elbegdorjhttp://bit.ly/z8qD2p
26) Gasoline prices.
a) Did DP pulling out of coalition government cause rising prices? 5 politicians provide their thoughts. http://bit.ly/xcZNmn
b) The Consumer Rights Protection Association Union (of Mongolia) says the price rises have no basis or merit. http://bit.ly/yh2q2u
27) Rare earths. Government had a seminar this past Tuesday. "Specialists from Mongolia, Germany and Canada took part…" The German ambassador made an opening greeting. The National Security Council of Mongolia presented a paper on the topic. Concern for environmental damage created by this sector was mentioned.http://bit.ly/xiyncY
28) Water petition. Residents living near Tavan Tolgoi and Mongolian Mining Corporation (MOGLF.PK) coal mines are concerned about fresh water and signing a petition to ask that a local lake be protected and prohibited from use by the mining companies. http://bit.ly/xoOzuu
29) Power problems. Dalanzadgad, the biggest city near Oyu Tolgoi and Tavan Tolgoi, has been dealing with a power plant break down. This article was published January 17, 2012, and says the plant was shut on January 10, 2012. My Lonely Planet guide says average temperatures in Dalanzadgad in January are between -10 and -20 Celsius (or 14 and -4 Fahrenheit) http://bit.ly/wgC0HD
30) Progress on drafting a law on improving the insurance on bank accounts in Mongolia. http://bit.ly/zCzLvx
31) Head of Mongolia's Nuclear Energy Authority has been fired by the government. This article suggests both and a deputy (fired last year) were both fired due to "controversy surrounding reports that Mongolia would become a repository for nuclear waste." http://bit.ly/xkWaaW
32) Brokerages. (A note from Frontier Securities). "number of brokerage increased to 76 in December 2011 compared to 72 in November, compared to 63 brokerages in October and September and compared to 49 brokerages in July; top 9 brokers in December - BDsec, TDB Capital, Monsec, Capital Market Corporation, Ard Capital Group, Gendex, Eurasia Capital, Gauli and Frontier Securities." http://bit.ly/zCJsQs
33) Parliament asked to resign. Why? New election law allocates so much money to each Member of Parliament that current members can "buy votes" and "the law guarantees the parties in power will remain in power." http://bit.ly/yzIa0O
34) New ministers replacing resigned DP ministers. Of note, D. Zorigt, the Minister of Mineral Resources and Energy is now additionally taking on the ministry of Road, Transportation, and Urban Development. Other ministries combined as well (Foreign Affairs with Defense, Social Welfare with Health, etc.) http://bit.ly/zOkRog
35) Demonstration against rising prices, inflation, etc, led by the Confederation of Trade Unions.
a) About 600 attended in about minus 30 weather. http://bit.ly/y1F6nF
b) and G. Uyanga's Promise Claiming People's Union participated http://bit.ly/wzYfkV
c) and the protest demands a better U.S. dollar exchange rate with the tugrik, cheaper gasoline, and a better standard of living for all. http://bit.ly/zIGSdu
36) Debate on allowances. University students get an allowance of 70,000 togrog a month ($51) and each citizen (adult and children) get 21,000 togrog a month ($15.25). A group of university students is urging students to refuse the money from the government because it creates inflation and encourages laziness. http://bit.ly/ylXb0B
a) New anticorruption laws to come into effect July 15, 2012 (after the next elections).http://bit.ly/wLe5Iy
b) Anti-Corruption Authority arrests the governor of a province for allowing a factory to be mismanaged to benefit a friend. http://bit.ly/AD7VrI
38) Consumer groups want petroleum companies fined for raising prices excessively. Petroleum companies say the price is tied to economics, supply, demand, and the exchange rate. bit.ly/wiSLO5
39) Farming equipment tax exemptions to be extended 5 years through the end of 2016. http://bit.ly/ydiQpi
40) $4 million in aid from Japan to Ulan Bator to fight for poverty. http://bit.ly/y4TOIG
41) European Bank of Reconstruction and Development [EBRD] is pleased to announced profits of 800 million Euros in 2011 ($1.043 billion; or 1.475 trillion Mongolian togrog). "Investments last year included a 10 percent increase to one billion euros in investment to Early Transition Countries -- 10 of the poorest countries in the region such as Mongolia, Tajikistan and Armenia." The EBRD, originally formed to aid the post-Communist countries at the end of the Cold War will expand its mandate to North Africa and the Middle East this year - Jordan and Tunisia became members in 2011 along pre-existing regional relationships with Morocco and Egypt.http://reut.rs/zkAuzd
42) China. (first 3 articles are Bloomberg making the case for easing)
a) Slowing GDP means the Chinese have room to ease means people are placing speculative investments the Chinese will ease. http://bloom.bg/xGrFLi
b) Another article on the narrative of China easing as an explanation for markets having their best single day rise since 2009. http://bloom.bg/zXkcir
c) Slowing manufacturing is another argument for the Chinese government easinghttp://bloom.bg/z2US9E
d) "foreign direct investment [in China] declined in December by the most since July 2009, underscoring the World Bank's warning that developing economies should 'prepare for the worst.'" http://bloom.bg/A30Mip
e) China home prices retreating. Is it dramatic decline or orderly? Headline is dramatic (China December Home Prices Post Worse Performance), numbers are orderly, with most drops less than 1% and the worst cited at 1.9%. http://bloom.bg/wOVCkE
f) Emerging Markets Stocks rose to a two-month high on China optimismhttp://bloom.bg/xnZwsl
g) Goldman Sachs "Jim O'Neill, the economist who coined the term BRIC a decade ago, said China's fourth-quarter growth rate, while the slowest in more than two years, was stronger than many analysts had forecast and was a "blow" to those predicting a "hard landing" for the nation's economy." http://bloom.bg/xo4DVX
h) U.S. Ambassador to China says the Chinese government's hold on power is "very, very delicate" http://bit.ly/AaRk41
i) And China agrees to increase petroleum exports to Mongolia after a recent state visit http://bit.ly/z4m7jK
j) while this fascinating article notes Denmark is aiding Chinese interests in Arctic exploration (for natural resources) and pushing for China to be a participant on the 8 member Arctic Council (U.S., Canada, Russia, Norway, Sweden, Finland, Iceland, Denmark). http://on.wsj.com/A7Z3cychina's-new-strategic-...
43) Borders to China stop for Chinese New Year. Will be the same for the Mongolia New Year in late February. http://bit.ly/wX66lc
44) The city center area of Ulan Bator around the parliament's square has banned smoking. http://bit.ly/ywdLgB
45) The rise of cell phone and decline of landline use has caused Mongolian Telecom to lay off 200 workers. http://bit.ly/zTXOIn
46) Mining supplier 2012 Mongolia conference March 15 & 16 in Ulan Bator. Number of supply mining supply companies estimated to be working in the country is 3,000.http://bit.ly/xEGGIs
47) Off topic, Cambodia. The guys at Capitalist Exploits posted an interesting interview with an investor in Cambodia this week (the Chairman of his investing company is Marc Faber). http://bit.ly/zYjq9Z
23 Jan, 11:06 AMReplyDelete CommentLike4
Jon SpringerComments (1373)
Here's the correct link for the article on Denmark supporting China's interests in Arctic natural resources exploration with a conduit via TinyURL to make it work: http://preview.tinyurl...
23 Jan, 11:09 AMReplyDelete CommentLike3
Joseph L. ShaeferComments (1189)
Excellent article on China's back-door entry into the Arctic, Jon. We'll see if this action by Denmark ignites a nationalistic response from the (relatively few) Greenland residents. Perhaps they'll conclude, if not this year then the next, it is in their interest to conduct their own foreign policy...
23 Jan, 11:43 AMReplyDelete CommentLike3
Valley BoyComments (1422)
Speaking of Marc Faber, here is an interview he gave about Mongolia in 2010.
23 Jan, 11:12 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
Thank you for all the great comments in the past week VB.
23 Jan, 11:35 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
Reposting the link for the Ocean Equities report from #5 which some good data as long as its available: http://tinyurl.com/7oz...
Thanks to OG for the Prophecy update below.
24 Jan, 03:11 PMReplyDelete CommentLike3
Here's the Prophesy Coal update on the plant in Mongolia,
24 Jan, 12:53 PMReplyDelete CommentLike4
Jon SpringerComments (1373)
More on Winsway (1733.HK) which could effect Marubeni (OTCPK:MARUY) (OTCPK:MARUF) and Peabody (BTU). Hong Kong markets will open tomorrow after being closed for the Chinese New Year. Oliver Belfitt-Nash of Monet Capital (http://www.monet.mn) in his daily note wrote, "Past accusations of this sort on Chinese companies have had devastating effects as short sellers and investor confidence weigh the stock down. However, we tentatively expect a correction as we believe the company fundamentals are still sound and these accusations have been effectively proved incorrect."
Report claiming fraud: http://bit.ly/xqNYHd
Rebuttal by Winsway: http://bit.ly/ztOlXq
25 Jan, 08:04 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
Waiting for further data to report on that.
25 Jan, 08:07 AMReplyDelete CommentLike3
Jon SpringerComments (1373)
January 30, 2012
Apologies this is late. I caught the flu on Thursday.
Numbers 35 through 38 this week have video links that are quite worthwhile.
January 31, 2012, TV guide. At 8:30 in Singapore, Masa Igata will be on Squawk Box on CNBC Asia discussing the timing of the Tavan Tolgoi IPO.
News that is missing this week. I can find nothing about Khan Resources (OTC:KHRIF) vs. ARMZ hearing that was scheduled for January 24, 2012 in Canada.
On to the news that is here…
1) An interview by me with Christopher de Gruben about Real Estate Mongolia which will now be an IPO company to be listed primarily in Canada and secondarily in the U.S. (subscriptions open to all). It is a lengthy interview that covers a lot of macro data. Questions are in bold so you can choose topics to read. For anyone investing in real estate investments in Mongolia, a must read in entirety. http://seekingalpha.co...
1a) I would really appreciate comments on this interview (likes, dislikes, what you want more of, or less of)
2) Rio Tinto (RIO) & Ivanhoe (IVN)
a) Rio may seek managerial changes at Ivanhoe after taking a 51% stake according to this article. In other news, I boldly predict Christmas will not only come this year, but next year as well. http://bloom.bg/w96JPW
b) But, Bloomberg says board members will remain "independent"http://buswk.co/xffARo
c) While Reuters Canada writes about a possible shakeup in management as wellhttp://bit.ly/zbqutb
d) WSJ expects management shake-up at Ivanhoe http://on.wsj.com/xs4CQg
e) Tom Albanese, representing RIO at Davos says, "Rio believes that the standards of safety we impose on our operations in the Pilbara should apply equally to our operations in Mongolia." (article later addresses issues with Australia's carbon tax)http://bit.ly/wwBfA9
f) Reuters Africa (which is actually the division of Reuters that covers Mongolia - don't ask me why) relevantly reports, "Rio may approach Ivanhoe "alone or jointly with a third party, concerning the long-term structure of their existing investment, a direct ownership interest in the Oyu Tolgoi project or other changes to the capitalization, ownership structure or operations of the company," Ivanhoe said in a filing to the Securities and Exchange Commission." http://bit.ly/zp6cQL
3) Erdene Resources (OTCPK:ERDCF)
a) continues to have good results, "Altan Nar has now demonstrated it hosts widespread gold mineralization including wide, near-surface zones potentially conducive to bulk mining, coupled with zones of higher grade mineralization that appear to become more substantial at depth," said Peter Akerley, President and CEO. "These initial results suggest that Altan Nar has the potential to host a significant gold-polymetallic deposit and we are planning an aggressive evaluation program in 2012."
Company announcement: http://mwne.ws/zPABny
b) for its Canadian and U.S. businesses is considering building a new marine terminal (article also discusses possibly spinning off its Mongolian assets) http://bit.ly/yWiluB
4) Prophecy Coal (OTCQX:PRPCF) "is pleased to provide the following update on EPC (Engineering, Procurement, Construction), PPA (Power Purchase Agreement), and project financing in connection with its proposed 600 MW Chandgana power plant project in Mongolia." http://bit.ly/A1qWYh
Proactive Investors: http://bit.ly/x5rAmk
6) Undur Tolgoi (UTM.V) approves that they will do some exploration workhttp://bit.ly/w9Bam2
7) Guilford Coal (GUF.AX), 10 page report on coal mining license being granted by the government of Mongolia and their coal resource being upgradedhttp://bit.ly/AsErF5
And their directors and management just got 9.1 million shares http://bit.ly/AeY4vw
8) Haranga (HAR.AX)
a) Quarterly activities report. Very good summary of where Matthew Wood's iron ore play in Mongolia is at http://bit.ly/Aj2jRO
b) Quarterly cash flow report http://bit.ly/yoMiiX
Article about how mining is threatening herders and nomadic life in the Gobi:http://f24.my/zbGFay
And a link to Oyu Tolgoi Watch Mongolia: http://bit.ly/yjKsv4
9) Xanadu Mines (XAM.AX) 17 page quarterly report http://bit.ly/wtEOiW
10) Draig (DRG.AX) has a new COO with longtime experience at Noble Grouphttp://bit.ly/zpEgxY
11) General Mining Corp (GMM.AX) requested a trading halt on the company on January 27, 2012, in lieu of a news announcement http://bit.ly/A1WkM3
12) Robe (ROB.AX) update http://bit.ly/wJkkAM
13) Winsway (0061.HK). Paul Garvey at the Australian pens a piece titled The Easy Steps To A Chinese Short-Selling Fortune on the heels of last week's credibility attack on Winsway. http://bit.ly/wKNhKo
14) Oxford Business Group. Mongolia: Year In Review 2011 (Mongolian at top, English below it) http://bit.ly/yGPU97
15) Coal. If you are interested in coal in Mongolia, read this article which provides a lot of data in a small space http://bit.ly/yt9sLS
16) At the Mobile Money Summit in Singapore, one speaker suggests "20% of [Mongolia's] population living [on] under $1.25 a day." http://bit.ly/wtyVpL
17) Editorial by Jargalsaikhan on the government's (in)ability to control gasoline prices http://bit.ly/Al7UNB-
19) Germany opens a technology center in Ulan Bator. http://bit.ly/x6eP9O
20) Government meets with the Confederation of Trade Unions about gasoline prices:http://bit.ly/yKqDc2
21) Business Council of Mongolia organizing Mongolian delegation to attend the PDAC International Convention, Trade Show Investors Exchange - Mining Investment Show in Toronto, March 4 - 7.
Convention info: http://bit.ly/A9aKDp
22) The Civil Will Party and the Green Party have merged and are now the Civil Will Green Party (CWGP). Most notably this will effect the identification of the most popular politician for members of the Western media to interview, Ms. Sanjaasuren Oyun, a member of the heretofore Civil Will Party.
Ms. Oyun's Wikipedia page: http://bit.ly/nIjJstSanjaasürengiin_Oyuun
23) Lawyers are suing the government for the pollution in Ulan Bator (ranked #2 most polluted city in the world): http://bit.ly/zjubUk
24) Coal Mongolia conference expect 700 attendees with about 35% from abroad (including myself). http://bit.ly/xTdULz
25) Number of companies with underwriting licenses in Mongolia moves up from 21 to 23 http://bit.ly/yN4Ubj
26) The EBRD (European Bank of Reconstruction and Development) has improved its growth forecast for Mongolia from it October 2011 analysis in its latest January 2012 forecast (to 7%, up from 6.6% for the Central Asia and Mongolia region)http://on.ft.com/yzYMCq
27) Car price inflation. Due to traffic, etc., the government is raising the tariffs on imported cars http://bit.ly/AbLSvu
28) IMF rep to Mongolia interviewed (says Mongol bank not at fault for high gasoline prices) http://bit.ly/AnHZFC
29) Using Mongolia's Wealth To Spur Social Development (a comparative approach)bit.ly/A4czf4-"resource-curse"-in-m...
30) Mongolia added 1.2 tons to its gold reserves in 2011 bringing it to a total of 3.5 tons. http://bloom.bg/xIkJPc
31) 25th anniversary of diplomatic U.S.-Mongolia relations. Only place I found an article about it, China's Xinhua news agency http://bit.ly/ylr8AG
32) Deloitte is opening an office in Mongolia. (This will provide some audit competition for PriceWaterhouseCoopers who is already there.) http://bit.ly/zug7uh
33) Mongolian gazelles declared innocent in case against them (they were accused of spreading foot and mouth disease) http://bit.ly/zSrRBQ
34) China - Home prices will be reasonable when they fall 30% and/or become equivalent to 6 years of salary http://bloom.bg/AbqHpF
35) Video interview of Stan Bharti (of Forbes & Manhattan - http://bit.ly/yRI79V) on De Facto. Many De Facto interviews start in Mongolian, but if you skip between 30 seconds and 3 minutes ahead you'll have English with Mongolian subtitles (though interviews with Mongolian business people stay in Mongolian as that is De Facto's primary audience). Interesting interview discussing different natural resource boom models that worked and did not (Brazil, Chile, Nigeria, Qatar, etc.); the natural resources boom cycle the globe is experiencing; reliance on China by Mongolia good and bad; etc.
You Tube: http://bit.ly/xUwCRx
De Facto home: http://jargaldefacto.com#!/
36) Audio interview with plenty of data points with Jamul Jadamba of AU Mogul Group from December (18 minutes). Thanks to the astute guys at http://bit.ly/AbNAbK for the recommendation. Interview: http://bit.ly/A7nUto
38) Deputy Minister of Finance, Ganhuyag Chuluun Hutagt, gave a TED talk in December 2011. (read his bio below the video box - well worth listening to despite the bad sound quality.)
Talk with bio: http://bit.ly/xJ1Wsm
Links to other TED Ulanbataar talks: http://bit.ly/wKl8FH
39) Templeton's Mark Mobius says QE3 will be good for emerging markets.http://bloom.bg/Abls1J
40) Thoughts from Capitalist Exploits' Mark Wallace on investing in Frontier Markets:http://seekingalpha.co...
30 Jan, 09:37 PMReplyDelete CommentLike6
Jon SpringerComments (1373)
January 30, 2012, addendum
41) Montsame article about Mongolyn Alt (MAK), a local conglomerate (http://bit.ly/tNJf3y), and their plans for a fuel plant. (please note links to Montsame article in English wind up hyper-linking to Mongolian, thus I am copying the article here in entirety) - Montsame's home page http://www.montsame.mn
All material below this point is Montsame's:
MAK COMPANY TO ERECT LIQUID FUEL FACTORY
Ulaanbaatar, Mongolia, January 25 /MONTSAME/ A national producer of mining--the MAK Company has announced that it will construct a factory of liquid fuel.
According to the company's spokesman, this factory will have a capability of producing 400 thousand tons fuel a year and will be erected near the Aduunchuluun coal deposit in Bayantumen soum, Dornod aimag. For the project, two billion US dollars will be issued.
As calculated, a dependence of Mongolia on oil products import from abroad will reduce by 30-40 per cent when the factory is put into use. In addition, the annual production of the fuel, approaching a level of AI-92 fuel, will provide some 40 percent of the domestic needs, and a price of the fuel will be cheaper than the current market's price.
A report on the external trade by November 2011 says that the annual price of imported oil increased by 64.7 per cent from the year 2010. In view of this, the MAK company considers that their liquid fuel made of coal will be sold cheaper and stable price, for example, one ton of the fuel will stand at USD 900, meaning one liter is to be around 1,200 togrogs.
In terms of reserves, Mongolia has oil reserve for 35-40 years, natural gas--for 60-70 years, and coal--for 250 years, according to researches. For the time being, some 300 coal deposits have been discovered here, and they are able to provide the country with the reserve for 300-400 years.
30 Jan, 09:49 PMReplyDelete CommentLike6
Jon SpringerComments (1373)
February 5, 2012
Greetings. Heading to Mongolia Monday. Will be in transit Monday and Tuesday. Will have 18 days, though only about 10 business days, in Mongolia. Got questions that need answers in Mongolia - post them here and I'll see what I can do in my spare time.
Please check the article on Seeking Alpha in item 44 from Chris Ackerman, Prophecy Coal's investor relations manager.
Also, thanks to Think-About-It and bazooooka for the kind comments on the interview with Christopher de Gruben.
Here's your weekly news.
1) Mongolia Mining Corp (MOGLF.PK) (0975.HK) has good news. Their "other mine" Baruun Naran has been commissioned and "The Company targets to mine 1.0 million tonnes run-of-mine ("ROM") coal by 31 December 2012 from the BN coking coal deposit." http://bit.ly/y3ctXs
3) Mongolia Energy Corp (OTCPK:MOAEY) (OTCPK:MOAEF) (0276.HK) An update on the return of $200 million for a deal called off. Have received HK$50 million and extended the HK$150 million's repayment time table to March 31, 2012. http://bit.ly/yXawzn
4) Lucky Strike Resources (OTC:LKYSF) was rated a speculative buy this past week by Frontier Securities. (no link)
7) Xanadu (XAM.AX) in talks to sell its thermal coal assets to focus on its coking coal assets. Owners of Erdene Resources (OTCPK:ERDCF) may be interested as they have a royalty interest on Xanadu's Galshar thermal coal project.
Link to Erdene Resource Development's Galshar page: bit.ly/sWGAE3
9) FeOre (FEO.AX) quarterly report http://bit.ly/zPxxxC
10) Draig (DRG.AX) quarterly report http://bit.ly/zw9eA5
11) General Mining Crop (GMM.AX)
a) "is very pleased to advise that Investmet Ltd (Investmet) has agreed to take a strategic stake in GMM and to assist in raising up to $1.9 million through a two stage capital raising. The capital raising will initially comprise a Placement to Investmet and/or its nominees followed by an Entitlement Issue, fully underwritten by Investmet. Investmet will also procure the purchase by GMM of two complementary Australian precious metal assets, further enhancing the potential of GMM's Australian portfolio."http://bit.ly/wd7HWF
b) quarterly report http://bit.ly/zPi3zi
12) Modun (MOU.AX) quarterly report http://bit.ly/yovTaj
13) TPL (TPL.AX) quarterly report http://bit.ly/Ac0jac
14) Altan Rio (AMO.V) grants stock options. http://mwne.ws/zntEPR
16) Mongolian Resource Corp (MUB.AX) quarterly report http://bit.ly/xrTCM1
17) Video on Ulan Bator (and Mongolia rising), 6 1/2 minutes of views and perspectives on the city and country: http://bit.ly/AAAew2
18) Erdenes MGL Tavan Tolgoi IPO and distribution of shares to citizens.
a) Short interviews with various members of parliament on their thoughts on the subject. http://bit.ly/zYbNIK
b) Research note from Frontier Securities: ETT CEO says parliamentarians don't usually decide par share values http://bit.ly/yumAu3
c) MPP pushing to double the allocation of shares to citizens to 1,072 (this adds 10% of the IPO that were originally to go to Mongolian businesses to the citizens, on top of the previous 10% already allocated to the citizens) http://bit.ly/zfGYpr
d) Protocol and discussion delays. Will the government get an accord to bring this IPO to market before the June elections? Stay tuned… http://bit.ly/zCV1vC
19) Iron ore. BDSec provides an interview with the CEO of Mongolia Stock Exchange listed iron ore company Khukh Gan that just completed a direct reduced iron manufacturing plant. (Khukh Gan is 52.5% owned by Beren Group)http://bit.ly/xNuMPW
20) 17.3%. BDSec has some notes on the economy expanding 17.3% in 2011 with an easy to read pie chart (mining is only contributing 16% to GDP currently).http://bit.ly/Agii6U
21) Balanced article: Australian miners test Mongolian frontier. http://bit.ly/wk1jJL
22) Short interview with Ministry of Mining man, D. Zorigt, who is also in charge of the Transportation Ministry until the elections. Interview about the "People's Development Program." Very happy to read an emphasis on building infrastructure and infrastructure skills in the answer to the second question. http://bit.ly/y6efyD
23) Petroleum prices. Long research note from Dale Choi at Frontier Securities. Bank of Mongolia and parliament data. http://bit.ly/xIfLG0
24) Exchange rate. Very good interview with D. Delgersaikhan, Director of the International Department at the Bank of Mongolia. "We have sent numerous requests to the State Great Khural to reduce budget loss, but they are still giving out cash. I would like to point out that when the BOM warns the Government about possible risks, they sit back and stay silent as if they do not care about it. But when the forewarned risk becomes a reality and economic damages are inflicted, they begin looking for people to put the blame on, as usual." "[W]e only intervene if there is an unexpected sudden fluctuation in the exchange rate." http://bit.ly/youCQz-
25) Prime Minister Batbold thinks… "S.Batbold also called for small- and medium-sized businesses to be exempted from taxes for a certain period. He said rich people should pay a higher tax than middle-income people, and households that run businesses should be supported by the state." http://bit.ly/z6Wwpf
26) Rare Earths. Jon Hykawy says Mongolia should be careful with its rare earth resources. http://bit.ly/xcXV9h-
27) State employee salaries and pensions. Going up a good bit now, and another 53% later. http://bit.ly/yxoJIt
28) Number of mining workers rising steadily. The problem is "other sectors" are having trouble keeping up with the wages increases in the mining sector.http://bit.ly/yZmkZc
29) Reorganization of administrative districts. A member of the Democrat Party is pointing out "that Mongolia's administrative structure was established in 1931 and it is hindering the country's development." Sounds dry, but reorganization is an important post-Communism issue. If administrative districts are reorganized or not, will likely have a relationship to infrastructure development. http://bit.ly/AEFh2q
30) It has been a "mild winter" in Mongolia, too… no severe snows, only minus 40 or so (the severe snows come on average once every 8 years and are called "dzuds", and they can be highly destructive to the livestock population, so ONLY minus 40s is mild). http://bit.ly/AgT16j
31) Cashmere. An article that explains supply from Mongolia - the second biggest cashmere producer in the world - was adversely affected by the 2010 dzud (see last item) and thus has become very costly. http://bit.ly/Ak661n
32) An interview with a Russian importer of Mongolian camel fur. http://bit.ly/yVjq1Z
33) De Facto's Jargalsaikhan with an editorial on "Transforming economic growth into economic development." http://bit.ly/yvkQ1q
34) Davos included a "Mongolian Night." Among 270 guests were, "Yukiya Amano, the IAEA director-general; Haruhiko Kuroda, the president of the Asian Development Bank; Philipp Misfelder, a Bundestag member; Martin Dahinden, a director-general of the Swiss Agency for Development and Cooperation; Steve Forbes, the editor-in-chief of the Forbes Magazine; and Christopher Wagner, the vice-president of the Credit Suisse Bank." http://bit.ly/yuEI7N
35) "Savings Bank of Mongolia signed a memorandum of cooperation with the German Agency for International Cooperation (GIZ) on Tuesday." http://bit.ly/Az2oz1
36) Mongol Bank has a problem with the sale of 20kg of gold not up to standardshttp://bit.ly/zLyAtQ
37) Some businesses have not been paying into the government's social insurance fund as they should. http://bit.ly/zDdutO
38) Reuters' David Stanway reprises his Key Political Risks To Watch In Mongoliahttp://bit.ly/ytjvzj
42) FC Ulaanbaatar to get 5,000 seat stadium with retractable roof.http://bit.ly/wqKbTW
43) Pollution and cold. Both bad this time of year in Ulan Bator. http://bit.ly/ykhlEb
44) Please check out this article by Chris Ackerman, independent investor, and Prophecy Coal (OTCQX:PRPCF) and Prophecy Platinum (PNIKF.PK) investor relations manager: Platinum, A Win-Win Precious Metal. http://seekingalpha.co... Its his first article on SA, so please give him a push by clicking the thumbs up to recommend his article to other folks on SA.
45) Iraq, a new frontier. Silk Road Management, a company that shares the same Chairman as Mongolian brokerage Eurasia Capital and is based in Mongolia, has launched two indexes for tracking Iraqi-related stocks. Interested investors can read through the index membership for investment ideas. http://bit.ly/yEOB7o
46) Your moment of investing peace: the study of aquatic insects in Mongolia (nice images of the countryside, a mellow scientist, and bugs bugs bugs).
5 Feb, 11:52 PMReplyDelete CommentLike6
Greetings from Ulaanbaatar!
Jon and I are actually staying in the same hotel with our rooms right across each other (by coincidence). I have been bombarding him with emails ever since last October, so it was great that we finally got to meet in person.
Although the market isn't ripe yet, I believe the timing couldn't be any better since Oyu Tolgoi and Tavan Tolgoi will be coming onboard in the near future. Thanks to the small, tight-knit community of businessmen in Ulaanbaatar, it only took two days to assure me that the business plans are viable. I will be making the permanent move to Mongolia as early as late April (Great weather conditions then!).
#27. An annual salary of 600,000 MNT is only less than $500! And this was just recently doubled? I also conversed with a hotel manager who is making 1,400,000 MNT on an annual basis, which is currently a little over $1,000. No wonder these teachers are protesting. The official GDP per capita is already over $3,000 (definitely much higher if you include the underground economy, which I was informed by Harris Kupperman that it is several times higher than the "above ground" economy).
#39. Somehow, many are interpreting this as "China is crashing" or "hard landing." This is why people like Gordon Chang can get rich by writing nonsense. 2012 is supposedly the year that it will really happen this time. I can't wait till December 31, 2012.
#45. Very interesting. Will definitely add Iraq to my list of stock exchanges to watch (Mongolia and Myanmar [2015 target]).
P.S. If you visit Mongolia and plan to eat lamb or beef, be prepared to chew A LOT. The meat is extremely tough since they are all free range and grass fed, even much tougher than the ones in the West.
9 Feb, 02:07 AMReplyDelete CommentLike6
how much does govt ownership of the mining project put a damper on explorer and miner companies?
Scary Cat (Steve)
16 Feb, 12:21 PMReplyDelete CommentLike1
Jon SpringerComments (1373)
Which mining project are you referring to?
Oyu Tolgoi - managed by Rio Tinto
State-run Tavan Togloi - a lot will be managed by BBH Operta and MacMahon, this will be fine
Mongolia Mining Corporation - excellent management, private and well-run
State-run Baganuur (on the Mongolia Stock Exchange) - mismanaged
I could go on, but the point is, this is quite the variable, so I'll need a more specific question.
16 Feb, 06:27 PMReplyDelete CommentLike4
<Only minus 40 or so...>
Have a good trip and don't forget your mittens!
6 Feb, 01:20 PMReplyDelete CommentLike4
Jon SpringerComments (1373)