MONGOLYN ALT (MAK) LLC
Status: Approved investmentWhy disclosure?
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Disclaimer
The information as disclosed is indicative and provided on an "as-is/as available" basis for general informational purposes only and should not be construed as financial, legal or investment advice, nor as a commitment or an offer to arrange or provide any financing. The final decision to provide financing is subject to the terms and conditions of FMO in its sole and absolute discretion. When providing links to other sites, FMO bears no responsibility for the accuracy, legality or content of the external site or for that of subsequent links. The information on proposed investment for high-risk investments is made available in the language relevant to the country or region where the bulk of operations take place. Translations of any information into languages other than English are intended as a convenience for local stakeholders. In case of any discrepancy, the information provided in English will prevail.
Who is our customer
Mongolyn Alt LLC (MAK), was founded in 1993 and is one of the largest mining groups in Mongolia. MAK's principal wholly-owned mining assets consist of 230 million tons (mt) of semi-soft metallurgical (for steel) coking coal reserves at its New Naryn Sukhait (NNS) mine, and 212 mt of copper ore reserves at the Tsagaan Suvarga (TS) mine.
What is our funding objective?
FMO provided a 7-year USD 50 million senior secured EBRD B-loan to MAK for the development of an open-pit copper mine in Tsagaan Suvarga in the South Gobi desert of Mongolia. The TS mine is a mid-sized copper deposit by world standards. The project encompasses the development of the TS mine, the acquisition and installation of a copper concentrate processing plant, investment in infrastructure and utilities.
Why do we fund this investment?
The project is highly developmental as it will allow MAK to diversify into copper and develop the mine in accordance with international environmental and social standards. The TS mine will stimulate revenues, and thus more corporate tax, royalties and foreign currency inflows to the Government of Mongolia. Moreover, in addition to an increase of employment of over 1,000 people, the Mongolian Government will benefit from the income tax of newly employed people. FMO's additionality in the project is substantial due to the scarcity of long-term capital in the Mongolian markets. Moreover, FMO's involvement in the project provided assurance to the co-investor EBRD, with whom the environmental, social and governance (ESG) standards are aligned. The non-financial contribution was largely made by EBRD, who played the leading role in ESG.
- Website customer/investment
- http://www.mak.mn/eng/
- Region
- Asia
- Country
- Mongolia
- Sector
- Infrastructure, Manufacturing and Services
- Effective date
- 6/19/2013
- Total FMO financing
- USD 50.00 MLN
- Funding
- FMO NV
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Risk categorization on environmental and social impacts, A = high risk, B+ = medium high risk, B = medium risk, C = low risk
Environmental & Social Category
(A, B+, B or C) - A