Erdenes Tavan Tolgoi LLC, Energy Resources, and Tavan Tolgoi JSC have resumed transport of coal on December 21 as the logjam of trucks that had reached 171 kilometers at its height at the Gashuunsukhait border crossing was addressed through a ban on export by the Mining Ministry.
The 240-kilometer road from Tavan Tolgoi to Gashuunsukhait border crossing is no longer the sight of a queue of coal trucks taking up more than half of the road.
Currently, the Gashuunsukhait border crossing passes through one vehicle every 15 to 20 seconds. In addition, Cabinet has decided that coal from Tavan Tolgoi will be routed from Tavan Tolgoi to Tsagaan Khad zone before being transported to Gashuunsukhait.
From now on, transport will be conducted on a tight organized schedule and therefore another logjam is not likely, say officials.
Erdenes Tavan Tolgoi has reported that on average, the reroute will cost coal exporting companies an extra two to three USD per ton. The state-owned company has exported 8.4 million tons of coal in 2017, while total production exceeded 10 million tons.
Of the 8.4 million tons, 5.3 million tons are sourced from the east tsankhi (block) of the Tavan Tolgoi mine and 3.1 million from the west tsankhi. More than 80 percent of coal from the east tsankhi is supplied to Aluminum Corporation of China Limited. On average, one ton of coal is sold at 59.3 USD to China.
Tavan Tolgoi JSC has exported 3.9 million tons at 61 USD per ton. Coal extracted and processed by Energy Resources is the most expensive with 150 USD per ton. The company exported a total of 2.8 million tons of coal in 2017.