MINING INDUSTRY EXECUTIVES PREDICT INCREASED EXPLORATION COULD RESULT IN A BOOM
Executives in the mining industry are predicting a new mining boom as a result of the Ministry of Mining’s decision to increase the amount of land authorized for mining exploration to 21 percent of the country's territory.
Andrew Stewart, managing director and CEO of Xanadu Mines, made an appearance on CNBC’s "Street Signs", outlining the new potential for a mining boom.
According to Stewart, Parliament's decision to revoke a resolution requiring foreign companies such as Rio Tinto to funnel all sales revenue through Mongolian banks will help increase in- vestment.
“It is an important thing for Mongolia as a whole. I think the reaction and the commitment you are seeing from the Mongolian government over the last two weeks to repeal this tax, it shows its firm commitment to really get the foreign investments going, and particularly, that is very much settled on minerals exploration and the mining industry in Mongolia," Stewart told CNBC.
Stewart also told CNBC that Xanadu's flagship Kharmagtai project, located 120 km south of Oyu Tolgoi, demonstrates that Mongolia offers increasingly favorable odds for discovering significant copper and gold deposits when compared to mature mining jurisdictions, such as those in Australia and Canada.
Back in March, Minister of Mining Ts.Dashdorj stated that the amount of land available for exploration would increase from 9.6 percent to 20.9 percent.
“The expansion reflects improved geological surveys, and the land open for exploration could increase as further improvements are made,” the Minister said. He added that a large amount of land will be available for exploration and licensing, also mentioning that ecologically sensitive areas will not be included.
Stewart said he feels that encouraging exploration is critical to establishing a healthy mining industry, and that great discoveries are often made when there are structural changes made to the industry.