Mongolia Weekly: 4 April 2011 - Eurasia Capital

US$Jan-10Feb-10Mar-10Apr-10May-10Jun-10Jul-10Aug-10Sep-10Oct-10Nov-10Dec-10Jan-11Feb-11Mar-11Mongolia Weekly (March 28-April 1, 2011)April 4, 2011 (Monday)produced about 100,000 tonnes of coke, of which 5% was sold to domestic steel producers and 95% wasexported to China.According to the Company’s website www.enk.mn, a study to establish a coke-chemical plant started in2005 and the Company was established with an investment from China in May 2006. In August 2007,Tavan Tolgoi Trans LLC, which transports coal from Tavan Tolgoi JSC’s mine to Chinese border, joinedinvesting to the project and the construction work started in Bayan-Ovoo soum (county) of South Gobiaimag (province). The Company completed the construction of the coal washing plant with a capacity of1.2mn tonnes in November 2008, and the 300,000 tonnes coke plant in December 2008. Apart fromcoke, the main product, the Company produces by-products as coke tar and firedamp.Rentsendorj Yondonrentsendorj.yondon@eurasiac.comIvanhoe Mines Announces FY2010 Results and Review of OperationsOn March 28, Ivanhoe Mines announced financial results and review of operations for financial yearended 31 December, 2010. The company reported net loss of US$211.5mn (US$0.42 per share) in 2010as compared to net loss of US$280.2mn (US$0.69 per share) in 2009. The exploration expensesincreased 23% from US$177.1mn in 2009 to US$218.6mn in 2010, and include exploration expendituresof US$134.5mn for Oyu Tolgoi and Ovoot Tolgoi projects in Mongolia. Until 31 March, 2010, Ivanhoeincluded the exploration costs in development costs associated with Oyu Tolgoi project. As of 1 April,2010, reserve estimates for Oyu Tolgoi were announced and the company started capitalizing theassociated development costs. During the financial year, a total of US$911mn costs were capitalized asproperty, plant and equipment. Total assets more than doubled to US$3,218mn by the year end.Highlights of Ivanhoe’s Mongolia focused operations:Construction at Oyu Tolgoi, a copper-goldproject in southern Mongolia, is movingforward ahead of schedule and isscheduled to start commercial productionduring the first half of 2013.On-site activities are expected to peak inmid-2011 with over 14,000 employeesduring the peak period. Oyu Tolgoisponsors 3,700 Mongolian employees forskill training.The company approved an estimatedUS$2.3bn capital budget for 2011.Share Performance3028262422201816141210Ivanhoe Mines and Rio Tinto reached acomprehensive agreement on funding forconstruction of the first phase of Oyu Source: BloombergTolgoi mining complex.The joint venture between Ivanhoe and BHP Billiton discovered the Ulaan Khud North coppermolybdenum-goldmineralization zone approximately 10 km north of Oyu Tolgoi.www.eurasiac.com 10