1. Ulaan-Ovoo coal mine
It is located in Tushigsoum, Selenge aimag, 17 km from the Russian border, 120 km from Shaamar railway station and the Ulaanbaatar-Sukhbaatar road, and 430 km from Ulaanbaatar. Soviet funds in the 1970s and estimated the deposit contained 280 million tons of good grade coal.
Toronto-registered Prophecy Coal Company is the sole owner of the mine. It started buying parts of the mine in 2006 and acquired 100% ownership in 2010, when operations were also started. Technical and economic evaluation work was done by Minarco-MineConsult of Australia. This put the total reserve of the mine at 208 million tons of which 174.5 million tons are Measured and 34.3 million tons Indicated. The mine’s annual capacity is estimated to be 6 million tons.
Since September 2011, Prophecy has sold and delivered 188,915 tons of thermal coal, including 8,055 tons to Russia, 23.543 tons to private Mongolian companies and 157.317 tons to government-owned power plants in Mongolia.
The company has contracts to deliver an additional 228.388 tons in 2012, the majority of which will be for the Darkhan and Erdenet power plants. Russian buyers have shown interest to buy a substantial quantity of Ulaan-Ovoo coal but Prophecy is withholding sales to Russia pending the opening of the Zheltura border crossing and announcement of a revised export royalty scheme from the General Department of Taxation of Mongolia. It is optimistic that the Zheltura border will be opened soon. This will play a significant role in delivering Ulaan-Ovoo coal to Russia and to South East Asian countries through the trans-Siberian railway.
Prophecy is currently doing exploration work in Zheltura area besides its coal project in Ulaan-Ovoo mine.
2. OvdogHudag coal mine
It is in Bayanjargalan and Undurshil soums of Dundgovi aimag and the exploration was done with State funds during socialist times. It is located not far from the Ulaanbaatar-Sainshand railway. The initial estimate of reserves was 169.2 million tons, but a re-estimation in 2011 raised this to 324.9 million tons. TaliinShigtgee LLC owns the mining license and is currently operating the mine.
During studies on coal liquefaction it was found that the coal from OvdogHudag is one of the best in Mongolia for this purpose. The mine has the advantage of being located alongside the railway to be constructed to TavanTolgoi and OyuTolgoi deposits.
3. Bayanteeg coal mine
Located in Nariinteel soum, Uvurkhangai aimag, this mine is 130 km from the aimag center and 560 km from Ulaanbaatar. The deposit was discovered in 1961 and exploration took place in 1978.
Bayanteeg Shareholding company is the owner. The company established the mine in 1962 with an annual output capacity of 25 000 tons of coal and has been supplying nearby soums with coal since then. Now it also delivers coal to Arkhangai, Uvurkhangai and Bayankhongor aimags. A fresh re-estimation put the Bayanteeg mine reserves at 29.6 million tons, of which 4.6 million tons have so far been extracted.
The mine covers 584 hectares and the exploration license number is MV-00367. The State plans to build a 40-MW power plant based on Bayanteeg mine. There is also talk of building a medium-size coal-to-gas plant in Bayanteeg as part of the first phase of the Coal Project which ends in 2015.
4. NuursKhotgor thermal coal mine
This is an Bukhmurun soum, Uvs aimag and as a big mine it has a significant role to play in the development of the western area. It supplies coal to Uvs and Bayan-Ulgii aimags.
State-owned Korea coal corp. bought 51 percent of the total shares of the mine for $10 million in December 2010.
With a big reserve of 109 million tons in NuurstKhotgor open mine, it would be possible to operate the mine for 30 to 40 years even if the annual production capacity is increased. The mine was officially opened in 2011, and from this year, the company’s annual sales target is 300 000 tons, gradually rising to more than 1 million tons. Korea Coal is confident of finding buyers in Russia’s Tuva and Altay and China’s Xinjiang.
Te total area the mine covers 128.7 sq km. the unexplored areas are also expected to hold a big reserve, and if this indeed turns out to be true, NuurstKhotgor might become a world class coal mine.
Canada and Mongolia invested Mongolia Minerals Company has bought a coal mine in the Khotgor coalfield. A company statement says: “We are working on the Technical and Economic Evaluation of our project. Once this is done, we plan to construct a 325 km road to Dayant port, Bayan-Ulgii aimag and deliver the coal is to be used for energy and as well as industry.”
Nearly ten companies own mining license in the NuurstKhotgor coalfield.
5. KharTarvagatai coal mine
Located in Umnugovi and Tarialan soum areas in Uvs aimag, this mine has over 23 million tons of reserve. It is 90 km from the Tarialan soum center. The socialist regime choseto develop this mine to supply coal to three nearby soums and to the border post. The mine has been in operation since 1964 and delivers coal to Uvs and Khovd aimags. There is a plan to build a power plant based on the mine, and there are proposals to arrange for transporting coal from Khotgorshanaga, Uvs aimag and KharTarvagatai mine to Dayant port in Bayan-Ulgii aimag in the future.
As layers above the coal in KharTarvagatai are thin, it is possible to use it is an open mine. It is also possible that a fresh study will increase the reserve amount.
6. Aduunchuluun thermal coal mine
It is located 6 km from Choibalsan city, Dornod, 665 km to the east of Ulaanbaatar and 100 km from the Mongolia-China border. It was discovered in 1951 and 1952 during a Soviet-led study of uranium mineralization near Bayanbulag mine, 16 km from Aduunchuluun. It has 423.8 million tons of reserve. Apart from this estimation in 1962, several other studies have been made here. These include hydrogeological studies in 1965 and 1981, an industrial geological exploration in 1988 and 1989 which determined the geological border of the mine.
Small-scale extraction began in 1955, mainly to supply coal to households, and over the years until 1966, annual output rose from 2000 tons to 11000 tons. The capacity kept on being increased little by little and starting in 1979, the mine has been extracting 600 000 tons a year, which makes it one of the biggest mines of the country.
The mine supplies to the Dornod area with coal. The operating company became a State owned Stock Company in 1995, and in 1999 it was fully privatized, the first such mine to earn that status. Currently, Aduunchuluun Co. operates another coalfield next to Aduunchuluun, under a joint operation contract with its owner, Naingi LLC.
MAK owns the exploration license on the area that surrounds the coalfields owned by Aduunchuluun and Naingi. It is economically unprofitable to transport thermal coal from Aduunchuluun local and foreign markets because the coal is high in moisture and low in calorific value. MAK conducted tests in Germany and Australia to dry the coal from Aduunchuluun and make briquettes of high calorific value. These were successful and MAK now plans to build a coal briquette plant based on output at Aduunchuluun with an annual capacity of one million tons of briquette.
The company also plans to build a plant near Aduunchuluun capable of producing 400 000 tons of gas from coal. The gas will be equal to regular 92 fuel and will meet 40 per cent of the domestic demand. It could even be exported at a competitive price. Just one part of Aduunchuluun has 283.7 million tons of coal, enough to supply the planned fuel plant for 47 years. The coalfield of which MAK owns the exploration license has 400 million tons of thermal coal reserve and detailed exploration I still to be completed.
The mine is 254 km by railway from Russia’s Solovyevsk port and 130 km by road from Arkhashaat border port of China. The State Property Committee has plans to build a 100-MW power plant in Dornod aimag and is looking for investors. This plant will use 909100 tons of thermal coal a year and produce 521.2 million KW energy per hour. The proposed plant is to use coal from Aduunchuluun, which is only seven km away and is connected by road. The mine is connected by railway to Bayantumen railway station, 5.5 km away.
7. TevshiinGovi thermal coal mine
This mine in Saintsagaan soum, Dundgovi aimag, has 932.2 million tons of coal, making it the country’s second biggest deposit after TavanTolgoi, which is 300 km to its south. The reserve estimate was made by Russian and Mongolian geologists. The mine was established in 1990 by the order of the Ministry, and since then it has been extracting 50000 tons of coal annually.
Now 100 percent privatized, the mine operates as TevshiinGovi LLC. It supplies Dundgovi aimag-centre, Erdenedalai, Luuz, Delgertsogt, DerenAdaatsag soums and some soums of Tuv aimag, as also the eastern part of Mandalgovi city with thermal coal. Even with its huge reserve, TevshiinGoviis at a disadvantage because of its isolated location. Its coal is also not top grade.
8. Talbulag thermal coal mine
This mine in Sukhbaaar soum, Sukhbaatar aimag was opened in 1970 and privatized in 197 with ownership going to Taliin Gal Company. The establishment of the Tumurtiin Ovoo processing plant helped the mine increase its output by 50 percent, as it sells 15000 tons of coal to the plant every year.
This coalfield is 35 km from the Sukhbaatar aimag centre where another coal mine has started operating. Engui Tal LLC is using the latest technology in its extraction and a new mine established last year is able to supply all the coal needs of Sukhbaatar aimag. Te mine has some 10 million tons of coal and annual output is estimated to be around 60000 tons.
9. Chandgana tal coal mine
Chandgana Tal is 25 km east of Murun soum centre, Khentii aimag, and 53 km east of aimag center Undurkhaan. It was discovered in the course of a Russian geological survey in 1941 and explored in detail in 1962 and 1963. The mine was opened in 1967 and extracted up to 20000 tons of coal every year which went to Undurkhaan city and nearby soums. Several companies own exploration licenses in this coalfield with a total reserve of 1.2 billion tons.
Chandgana coal Project, invested 100 percent by Canada’s Prophecy Coal, is part of this coalfield. It lies in the northeastern end of the basin and its two licenses control Measured resource of 141 million tons.
The mines are located nine km from each other and have access to infrastructure, being close to habitation, roads and power transmitting lines. Chandgana is connected to Ulaanbaatar and the railway by paved road, which gives it direct access to both China and Russia. Chandgana Tal coal project owns mining license over 32 hectares of land and exploration license over 300 hectares.
Prophecy obtained full mining license of the deposit in February, 2011 from the Mineral resources Authority of Mongolia. In November, it received the license from the Mongolian Energy Regulatory Authority to construct the 600-MW Chandgana power plant. The proposed plant will use 2.4 million tons of coal from Chandana Tal mine every year. When the power plant is expanded, the coal will come from the Chandgana Khavtgai mine which has 1.05 billion tons of reserves.
Prophecy considers it will make more sense to produce and sell power rather than coal.
10. KhuutiinKhonkhor thermal coal basin
Not far from the Ulaanbaatar-Sainshand railway, this mine is in Bayanjargalan soum, Dundgovi aimag and holds 104.2 million tons of coal. It was discovered as a result of State funded survey work between 1954 and 1980.
MAK owns a mining license over 1.444 hectares in Khuut’s oil shale and coalfield, with estimated reserves of 487 million tons of oil shale and 190 million tons of coal. Detailed exploration continues to take place. With help from companies from China, Canada, Estonia and Brazil MAK has been experimenting with producingsyn-oil from oil shale. MAK hopes the detailed exploration and semi-plant experiments and the feasibility study will be complete soon. The company has also conducted studies to extract gas products similar to oil from oil shale. These have revealed that Khuut and Eedemt mines have high grade organic substances.
