Buuruljuut mine and power plant investment agreement signed

Agreement signing ceremony for Buuruljuut Power Plant

On May 31, the Minister of Energy signed an investment and electricity sales and purchase agreement for the Buuruljuut mine and power station, one of the largest energy projects moving forward in Mongolia.

Construction of the Buuruljuut power plant, located 120 km from Ulaanbaatar in Tuv Province’s Bayanjargalan soum, will now commence. Total investment required for the project’s implementation is an estimated one billion USD. The power plant is expected to be operational by 2019, designed to produce 1.6 billion kWh annually, around 30 percent of Mongolia’s total energy consumption. The plant will start producing 3.2 billion kWh starting in 2022, supplying power for the country’s central energy network.

Cabinet members and other state officials have emphasized that the project comes second after Oyu Tolgoi in its importance to Mongolia.

At the agreement signing ceremony, Prime Minister Ch.Saikhanbileg said, “The signing of the agreement for the Buuruljuut power plant is another good example indicating that Mongolia is back to businesses and investment is recovering. Bodi International Group established Tsetsens Mining & Energy. The company launched the project to build the 600 megawatt power plant based on the brown coal of Buuruljuut mine five years ago. Now the project has drawn in one billion USD in investments, becoming a real project. I appreciate that the private sector has drawn in such an investment to make the wealth inherited from our ancestors more valuable and efficient, and contributing to meeting energy demands for the rapidly growing mining industry.”

The PM also thanked Power China Resources for making an investment and introducing environmentally-friendly technology to Mongolia. PM Ch.Saikhanbileg underlined that Mongolia is a country that is pleasant for making investments and has great energy resources that are marketable around the world. He also emphasized that the legal environment is improving in Mongolia.

Minister of Energy D.Zorigt said, “Mongolia is implementing several projects to meet the energy demands of Mongolia over the next 30 years, one of which is the Buuruljuut power plant. The plant will meet the energy demands of central, southern, and southeast Mongolia. I believe that this project is vital to energy cooperation between Mongolia and China.”

Director of Bodi International’s Board D.Baysgalan underlined that the company has been struggling for many years to implement the project. “We spent quite a lot of time choosing the best location, exploring coal at the lowest cost, and finding the best partner.”

D.Baysgalan said that the project will be implemented in two stages, the first of which is now commencing. “Our partner is Power China Resources, which is the biggest energy producer in the world. We have faced many challenges to reach today. Our project meets Mongolia’s state policy. This will be the biggest and most successful project with China.

“In accordance with our agreement, we will draw in 1.1 billion USD in investments to Mongolia, and open a power plant by September 2020,” D.Baysgalan said.

Minister of Energy D.Zorigt signed the investment agreement on behalf of the government. Director of the Board of Bodi International D.Baysgalan, the Director of the Board of Power China Resources, and the Executive Director of Tsetsens Mining & Energy B.Amarmend signed the agreement representing the investors.

The electricity sales and purchase agreement was signed by Executive Director of the National Dispatching Center Kh.Tsogtbaatar, Executive Director of National Grid Electricity Transmission G.Zandankhuu, Bodi International’s D.Baysgalan, the Director of Board of Power China Resources, and Tsetsens Mining & Energy LLC’s B.Amarmend.