Mongolia’s Prime Minister Sanjaa Bayar has made the finalization of an investment agreement with Ivanhoe Mines for the construction of a copper and gold mine at Oyu Tolgoi one of his government’s major priorities.

The Prime Minister announced a series of five short-term priorities that he wants completed before the next general election, scheduled for June 2008. The second priority concerning the utilization of natural resources was welcomed by Ivanhoe Mines.

He said that in the first instance this priority would be achieved through approval of Ivanhoe Mines' Oyu Tolgoi copper-gold project and the Tavan Tolgoi coal project presently owned by a Mongolian private sector consortium.

He said it was a priority for his government to finalize an investment agreement to clear the way for construction of Ivanhoe's planned mine at Oyu Tolgoi “as soon as possible”.

The Prime Minister identified electoral system innovation, utilization of natural resources, innovation of a registration system, share distribution and civil service innovation, and said his cabinet would work against time to complete the tasks before the election.

“Mongolia’s natural resources are valuable and attract increasing attention. Therefore, it is our duty to the next generation to use this opportunity properly. If we lose it by quarrelling with each other, the next generation will blame us. We should give our next generation a wealthy country with progressive technology and high intellectual capacity.

“As for the Oyu Tolgoi agreement, we should conclude a world standard agreement, beneficial to the country. I think it is more reliable if we hire an internationally recognized financial organization to deal with it for the sake of the government of Mongolia. But the government suggests its conditions and requirements.

“As for Tavan Tolgoi deposit, we should decide how to use it after taking it under 100% State control. The Government of Mongolia has a moral right to take it under its control because it explored it with State funds. The government resolved to take it under its control and negotiate with investors for the sake of state because it is a strategic deposit, related to national interest and security.

“There are stalemates in both Oyu Tolgoi project and Tavan Tolgoi projects. Thus it is the government’s duty is to find the right solution as soon as possible.”