Olon Ovoo Makes Headlines Once More

Last week’s news was the State Bank’s takeover of Khadgalamj Bank due to insolvency. The Head of Just Group, and major stakeholder of Khadgalamj Bank, Sh.Batkhuu told journalists in a press conference that his default on the bank’s loan was due to the fact that he was misinformed about the Olon Ovoo gold mine he purchased from Ts.Myanganbayar, director of Mongol Gazar.

Olon Ovoo has become a notorious mine in Mongolia, as three banks have now been bankrupted after financial involvement with the project. It is referred to in some circles as the “jinxed mine”. After every bankruptcy, the state took control of the banks; Anod Bank JSC in 2008, Zoos Bank JSC in 2009, and Khadgalamj bank last week.

We sat down with the Head of the Geology Department at the Mineral Resource Authority, D.Bold, to find out how the Olon Ovoo mine reserve was approved, and how the estimated reserve can be changed.

-It is said that it is common that during mine exploration, for the proven reserve of a mine to change. For instance, Mongolia’s estimated coal reserve has increased, placing the country among the top ten coal rich nations of the world. So how is a reserve approved and announced?

-Every nation has an organization or an agency registering all the reserves of its mineral resources. The Mongolian Mineral Resources Professional Council, adjacent to the Mineral Resource Authority, is responsible for registry of...