MONGOLIA MINING ISSUES SEPTEMBER 2012
OYU TOLGOI COPPER\GOLD & SILVER
DEPOSIT
• Location – Gobi Desert, South Gobi province,
100 km from border with China
• Owned - 66% Rio Tinto\Ivanhoe Mines;
34% Mongolia
• Investment requirement - total $13.2 bln
• Current project $4.0 bln – $900 mln cut by roads and diversion at
OT pit and international airport – no EIA, no local approval
• Project disclosed by IFC on August 24, 2012
• Disclosure date by EBRD is September 5,2012
• Closure of ESIA consultations – ???
• Board date – NOVEMBER 8, 2012
OYU TOLGOI ESIA
• ESIA -evaluating impact of construction phase
OT project construction 94% complete
• ESIA –not evaluation but a report based on pre 2009 EIAs
• No stakeholder consultation & approval process
• Recent updates not all incorporated
• ESIA report not accessible to affected communities
TAVAN TOLGOI: UKHAA HUDAG MINE
ENERGY RESOURCE
• Name of the project: Ukhaa Hudag/Tavan Tolgoi
• Coal reserves: TT contains estimated 6.5 billion tons of which UH 4%
• Location – Gobi Desert: 160 km from Oyu Tolgoi; 245km from China
border
• Coal washing plant: 5 mtpa capacity plant funded by EBRD
• Power plant – 18 MWT
• Private airport
• Private blacktop road to border
• Private railroad toborder under construction
OTHER MINES
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Tsagaan Suvraga – MAK cooper deposit – EBRD funded at $300 mln
Tavan Tolgoi – Erdenes MGL – big interest
Tavan Tolgoi – Ajnai Corporation
Tsagaan Tolgoi – IvanhoeMines/Rio Tinto subsidiary
Ovoot Tolgoi - IvanhoeMines/Rio Tinto subsidiary
COMMON ISSUES
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Funded or actively considered for funding by WB/IFC and EBRD
Lack of water resources for life of project – 870 l/s
Lack of international standards EIA/SIA
Lack of FPIC by local communities on extraction operations or
infrastructure projects
• No recognition of “indigenous peoples” rights of nomadic herders
• Common areas of impact on the environment and communities
• Lack of HIA on local communities
ISSUES WITH THE IFC ESIA
• ESIA –evaluation of the construction phase impact assessment
2009 reports dressed to meet IFC standards
• ESIA – no evaluation of impact from the extraction process;
• Consultation process – no consultation for approval of local
communities; no stakeholder discussions;
• Disclosure date – closure dates
IMPACTS CAUSING SOCIAL TENSION
Severe water scarcity & its degrading quality
Loss of pasture as livelihood means for nomadic
pastoralists
Depletion of herder wells
Loss of agriculture land - 40% workforce
Loss of nomadic lifestyle & cultural traditions
Contamination of living environment for human
and wildlife populations
Desertification: soil and pasture degradation
QUESTIONS & CONCERNS
• Do WB/IFC and EBRD policies allow loans for extraction operations
without an ESIA for its mining impact?
• $4.0 bln loan to projects that do not have proven and available
water resources?
• Why nomadic herders of Mongolia are not recognized as indigenous
people by EBRD and IFC?
• Cumulative and aggregate impact on water, climate change , bank
portfolio?