Country Outlook

N. Gerelchimeg

Over the past 25 years, Mongolia has transformed into a vibrant democracy, tripling its GDP per capita since 1991. With vast agricultural, livestock and mineral resources and an increasingly educated population, Mongolia’s development prospects look promising in the long-term assuming the continuation of structural reforms1.

In 2019, Mongolian GDP at current prices had reached MNT 236.9 trillion with an increase of 13.8% over the previous year3.
According to the National Statistics Office of Mongolia (NSO), real GDP growth of Mongolia weakened to 5.1% in 2019 from 7.2 % in 2018. 4Following the gradual decline in commodity prices combined with a reduction in the quality of crucial mineral exports, growth moderated to 5.1 % in 2019.

Having a look at the composition of GDP, mining is the second biggest sector in Mongolian GDP, and the sector is accounted for 23.8% of total GDP at current prices and 84 % of total export at the end of 2019.

Extractive Sector in Mongolia
Mongolia has large mineral potential, over 6,000 mineral deposits and occurrences of 80 types of minerals have been discovered5. 1,674 mining licenses and 1,080 exploration licenses have been provided to the stakeholders where totally occupies 4.7 % of the total territory of Mongolia as of 31 March 20206.  When looking into the license holders, 74.3 % is being held by Mongolian entities, and 25.7 % has been held by 100% Foreign-invested companies and Joint foreign entities7.

Mongolia exports crude oil as there is no oil refinery plant and equipment currently in the Country. Currently, there are 32 licensed petroleum areas in Mongolia, and 21 contractors are operating with Product Sharing Agreements with the Government of Mongolia on 25 of these areas8.
According to Mineral Resources and Petroleum Authority of Mongolia (MRPAM), nine uranium mining licenses were held by four companies, and 14 uranium exploration licenses were held by eight companies as of 2018.

Major minerals production and projects
Per 2018 EITI report, the minerals which have the highest portion in Government revenue are coal, molybdenum, copper, polymetallic and gold.

Mongolia is included in the top ten countries in the world with its coal reserves, and Mongolia’s coal reserves are estimated that 173.3 billion tonnes with over 300 deposits from 15 basins9. In 2019, coal production had reached 57.1 million tonnes and sold, and exported coal was 47 million and 36.8 million tonnes respectively10.
Mongolia’s gold mining amounted 20.7 tonnes, and gold exports reached USD 144.5 million per 2018 EITI report.  The Country’s exported copper concentrate has reached 1.4 million tonnes of USD 2 billion by the end of 201811.
Mongolia has produced 6.8 million barrel petroleum production and exported 6.5 million barrel during the year 201912.

Mongolia has a significant number of companies operating in its extractive sector including Erdenet mining Corporation, Oyu Tolgoi LLC, Erdenes Tavan Tolgoi JSC, Petrochina Dachin Tamsag LLC and Tavan Tolgoi JSC. These companies were composing 70 % of the Government revenue in the year 2018.
The Oyu Tolgoi copper and gold mine is the single largest mining project, which is expected to be one of the top five global copper producers. Tavan Tolgoi is the world’s largest undeveloped coal mine.
Over 40 of mining companies were registered at international and Mongolian stock exchanges as of March 2020.

The biggest of companies registered with stock exchanges as NYQ, LSE, and TOR operating in the Mongolian mining sector are Rio Tinto plc, Centerra Gold Inc, Turquoise Hill Resources Ltd as well as Peabody Energy Corporation13.

Renewable energy in Mongolia
The Government of Mongolia is intensely promoting renewable energy sector recently.  According to the Energy Regulatory Commission of Mongolia, Mongolia’s electricity production reached 7,003.3 million KWh in 2019, and its 8.1 % is generated by wind and solar energy.

Legislation Environment in the Sector
As at stated in Constitution Law of Mongolia, the land, its subsoil, forests, water, fauna, flora and other natural resources are subject to national sovereignty and state protection14.
Mongolia enacted Mineral laws in 2006 firstly to regulate the mining activities, Petroleum Products law in 2005 and Law on Nuclear Energy was issued in 2005 respectively. The Renewable Energy Law was approved in 2007.

Thereafter, the required amendments and revisions of these laws were made accordingly15.
The main taxes levied on the mining sector include royalties, corporate income tax, customs duties and license fees, while the major oil and gas levies are state petroleum receipts from production-sharing agreements, corporate income tax and customs duties.

Mongolia has joined Extractive Industries Transparency Initiative (EITI) in 2007 and has implemented EITI standards in satisfactory progress by the validation made on 13 February 201816. The EITI Secretariat in Mongolia is responsible for day to day operation of the EITI process in Mongolia, and the National Council monitors and coordinates the implementation of EITI in Mongolia at the policy level. For 2018 EITI report, the data of 2,052 companies operating in Mongolian extractive sector were consolidated.

Moore Mongolia
Moore Audit LLC is an independent firm of Moore Global network and was incorporated in Mongolia named as Od Burtgel LLC in 2008. The firm provides audit, assurance, and advisory services and the seventh-largest accounting firm in Mongolia.

The firm and its professionals have broad experiences in the mining and petroleum sector for its assurance and advisory services, and partner Oyunaa.U leads the sector engagements. Our current largest mining clients are operating in the extraction of coal and zinc minerals. These companies or their holding company were included in the top ten companies which paid the highest tax and fees to the Government of Mongolia.


2. MNT is Mongolian national currency, called Mongol tugrik. As of December 31, 2019, one USD was equal to 2,734.33 tugrik as declared by the Bank of Mongolia.
3. Mongolia: Report on Gross Domestic Product, NSO of Mongolia, March 2020
4. Mongolia: Report on Gross Domestic Product, NSO of Mongolia, March 2020
5. Mongolia EITI Report 2018, page 49, December 2019
6. Mineral Resources and Petroleum Statistics Report, Mineral Resources and Petroleum Authority of Mongolia (MRPAM), March 2020
7. Mineral Resources and Petroleum Statistics Report, MRPAM, March 2020
8. Mongolia EITI Report 2018, December 2019
9. Mongolia EITI Report 2018, December 2019
10. Mineral Resources and Petroleum Statistics Report, MRPAM, March 2020
11. Mongolia EITI Report 2018, December 2019
12. Mineral Resources and Petroleum Statistics Report, MRPAM, March 2020
13. Mineral Resources and Petroleum Statistics Report, MRPAM, March 2020
14. Article 6.1 of Constitutional Law of Mongolia
15. Mongolian legal portal,