The Government of Mongolia clarifies that the cancellation of the Southern Region Power Sector Cooperation Agreement with Oyu Tolgoi LLC doesn’t rule out the Tavan Tolgoi Power Project. Which is worth USD 1 billion.
The Government expressed its stance regarding the ongoing inaccurate media reports on February 20, at a press conference held by Minister of Energy Ts.Davaasuren and tavan tolgoi power Project Director D.Batbileg.
The officials confirmed that the Mongolian Government had expressed its intention to annul the Southern Region Power Sector Cooperation Agreement, which was signed in 2014.
The 2009 Oyu Tolgoi Investment Agreement between the Government and Rio Tinto states that the Investor will, within 4 years of Commencement of Production, secure its total power requirements for the OT Project from one or more of the following sources within Mongolia – coal-fired power plant developed or funded by the Investor, coal-fired power plant developed or funded by a third party, or the Mongolian electricity grid.
In accordance with the above provision (7.3), Oyu Tolgoi was liable to secure its energy need from domestic sources starting from July, 2017.
Oyu Tolgoi has been importing energy from the People’s Republic of China.
On the other hand, Tavan
Tolgoi Power Project Director D.Batbileg reported that the project was running
normally.If the construction works begin in 2018, it will wrap up in 2021.