the fighting between the two parties after the last Presidential election, where the incumbent who lost was sent to jail. To me I am comfortable that the Mongolians want to get back on track, but RIO, now that they have pushed Ivanhoe and Robert Friedland out, doesn't want to commit funds at this time under the current commodity collapse. The ball is in RIO's court.
Kincora Copper Limited announced that the Mongolian Ministry of Mining has proposed a “win-win solution” for all stakeholders to resolve disputes relating to the revocation of 106 mineral exploration licenses in late Kincora Copper Limited announced that the Mongolian Ministry of Mining has proposed a “win-win solution” for all stakeholders to resolve disputes relating to th revocation of 106 mineral exploration licenses in late 2013.
The proposal, which follows constructive face to face discussions with the ministry, is expected to be presented as a resolution to the spring session of the Mongolian Parliament, which recently commenced. Kincora is one of 11 foreign investors and 66 local groups impacted by the decision to revoke 106 licenses following a criminal court case involving former government officials, the company said.
Commenting on the announcement, Sam Spring, President and CEO of Kincora, said:
“This case has had a major, negative impact on investor sentiment towards Mongolia and the way in which the government responds to investor concerns about the revocation of licenses, we hope, will set a positive and visible precedent as to how future investors will be treated. Although Kincora has recently successfully raised capital to explore our flagship and unencumbered Bronze Fox project, uncertainty relating to the 106-license issue has significantly impacted investment and asset valuations in Mongolia.
BLOOMBERG: Mongolia Prepares to Restore Mining Licenses in Investment Boost
Mongolia is preparing to overturn last year’s cancellation of 106 mining licenses in a further attempt to revive investor confidence in the mineral rich nation, according to one company stripped of its permit.
The mining ministry has proposed returning the licenses to “compliant” holders, including a “mechanism to compensate for the time lost due to original judicial process.
The licenses, including 11 held by foreign investors, were revoked after the government found they had been issued illegally.
“The Ministry of Mining and government is working to find the best solution for the license holders,” the ministry said in an e-mail. The proposal will still need sign-off from parliament.
The license issue and a high-profile and as yet unresolved spat between the government and London-based Rio Tinto Group over their shared Oyu Tolgoi copper mine are among the disputes that have sapped confidence in Mongolia’s mining industry, curbing foreign investment and economic growth.
“This case has had a major, negative impact on investor sentiment toward Mongolia and the way in which the government responds to investor concerns about the revocation of licenses, we hope, will set a positive and visible precedent as to how future investors will be treated,” Sam Spring, Kincora’s president and chief executive officer, said in the statement.
Earlier this month, Mongolia’s government said it intended to submit two bills to parliament that could stimulate its mining sector and stoke investment. The first would annul a 2010 law suspending the issue of new exploration licenses. The second would amend guidelines applied to a 2009 law on rivers and forests, to allow mining in areas previously off-limits due to environmental concerns.
Positive news that it is coming to a head......Rio will negotiate the strongest deal they can and Mongolia doesn't want to look like a push over....it will get done though....don't be short!
Sentiment: Strong Buy
You're logic isn't logical. Wouldn't RIO love to buyout TRQ while it can cheaply (I.e. During the commodity collapse, as you called it)???
How is GOM "actively" solving anything? After 2 years of waiting?
Sentiment: Strong Buy
Read my previous post and learn.
Trying to enact a hostile takeover by buying out the Mongolians, in my opinion, would unleash a modern day Gengis Khan hell on RIO. The whole "Buyout" scenario was a ploy option traders initiated as the put action went up re-markedly high the day before the announcement came out in the Guardian. Rookies got played.
Kincora has been proactively working with the Ministry of Mining to achieve a win-win solution for all stakeholders and I very much believe the key concepts in the resolution put forward to the Mongolian Parliament will achieve that. The proposed resolution of the 106-license issue is probably the most transparent and tangible recent example of the Government of Mongolia, via the Ministry, working with investors to revive private sector activities, learn and move on from past mistakes acknowledging security of tenure. While Parliamentary approval is still required, a timely approval of the resolution, and its implementation, could support compliant former licenses holders undertaking field season activities this year.
“Kincora is in the advanced stages of mobilizing field season activities at our Bronze Fox project, noting the extremely competitive environment for service providers.”
Kincora said that resolving the 106-license case has been a priority for the Ministry since the issue came under its jurisdiction and it has been working together with impacted investors to resolve the matter. A case by case investigation of the impacted licenses has been conducted in support of a resolution that is to be presented to Parliament. The resolution recognizes the security of tenure and offers a proposed mechanism to compensate for the time lost due to the original judicial process and the returning of licenses back to compliant license holders. As such the proposed resolution is considered to be a “win-win outcome for all stakeholders.”
In its September 2013 quarterly accounts, Kincora wrote off 6,952,000 CAD relating to its Tourmaline Hills and North Fox licenses, which were revoked as part of the 106 case. Kincora’s two licenses were acquired from a private Canadian group in 2012, following full due diligence, and are lower priority exploration licenses adjacent to the flagship Bronze Fox project. Bronze Fox remains unencumbered and Kincora is in advanced stages of mobilizing activities there ahead of further exploration activities in the upcoming field season, the company said.
While the resolution still requires Parliamentary approval, it follows the approval of other recent positive legislative reforms such as the Investment Law, to promote private sector activity, said Kincora. The ministry is also proposing a number of other resolutions to be heard in the spring session of Parliament relating to the “Long Name Law,” revision of the tender regulation, which would see the three year moratorium for new exploration licenses lifted, and other amendments to the existing 2006 Minerals Law.
Let's give this some time to work it's way through the spring session of Parliament. The Democratic Party won the elections last year and hold a majority of the seats in Parliament so I believe the members of the Mongolian People's Party, who were mainly responsible for trying to break the IVN contract, have been neutralized. Time will tell.