B.Gankhuyag confirmed as CEO of Erdenes TT
Acting CEO of Erdenes Tavan Tolgoi (Erdenes TT) B.Gankhuyag has been appointed as CEO by the company’s board, while B.Jargalsaikhan was appointed as deputy CEO.
B.Gankhuyag is one of the first employees of Erdenes TT and had been working as the deputy CEO of the company prior to being appointed interim CEO after former CEO D.Ariunbold was relieved of his duties. He has served as president of the Union of Mongolian Students and board member on Erdenes Mongol.
Recently, B.Gankhuyag and the administration of the company was able to reach an agreement with Erdenes TT’s biggest customer, Aluminum Corporation of China Limited (Chalco), to raise prices from the Tavan Tolgoi mine’s East Tsanhki (block) to 60 USD per ton.
Furthermore, Erdenes TT has said that it proposed to increase prices to 61.35 USD and that the Chalco board will give an answer in the near future. Coking coal from the West Tsankhi is sold at 68.1 USD per ton while coal used for energy is sold at 12 to 16 USD per ton.
As per the agreement that Erdenes TT reached with Chalco in 2011, the prices of coal are index-based and are subject to change every quarter depending on market conditions. The administration of Erdenes TT is seeking to improve the agreement.
In order to improve the agreement for Erdenes TT, the administration of the company met with Chalco Trading Hong Kong on May 10 and 11. Ultimately, the two sides added one additional index to the calculation of price, increasing the number of indices to five. Previously, the price was 60 percent dependent on the Cr China Coking Coal Price Index. With the agreement, that number will be brought down to 30 percent.
The administration of Erdenes TT has said that the new agreement will allow coal from East Tsankhi to be sold at prices closer to the coking coal from West Tsankhi in a year or year-and-a-half from now. In addition, the new price calculation will help stabilize prices and prevent significant fluctuations.
Under B.Gankhuyag’s administration, the company has announced its intention to register its shares on the Mongolian Stock Exchange (MSE) in September 2018 and its future plan to list the company on an international stock exchange. The company also plans to distribute dividends in 2019.