Ivanhoe assured on Oyu Tolgoi

IVANHOE Mines claims it won't be forced to sell or give up a stake in its Oyu Tolgoi project to the Mongolian Government.

Michael Quinn

While recent speculation about the Mongolian Government seeking stakes in mining projects appears to have some basis, Ivanhoe said any changes to the law won't be applied retroactively.

"The ministry's revised suggestion is that the government would have the option of acquiring up to 30% of projects that actually had been discovered by government-funded exploration," a statement released by Ivanhoe said.

"The ministry currently is proposing that the government would have an option to acquire an interest of up to 15% in so called strategic deposits that were not government funded; however, such a provision would apply only to future projects, and would not be retroactive to existing discoveries and developments, officials said."

Still, investors who marked the stock down on the earlier speculation remained cautious. The stock closed (Monday) in Toronto down 8c at $C8.40. Prior to the speculation the shares were changing hands for over $C9.

Ivanhoe also has coal interests in the country, hoping to kick-off a pre-feasibility study at its Nariin Sukhhait coal deposit in southern Mongolia.