Public Private Partnerships in Mongolia Ts. Batbayar Head of the Concession Division Department of Innovation and Public-Private Partnerships

CONTENTS Public Private Partnership and the legal framework Public private partnerships today List of Concession projects

Public Private Partnership and the legal framework

Why we need PPPs ? Growing investment needs in infrastructure in line with Government priority projects Accelerate economic growth by leveraging the financial resources, technology and management know-how of private sector To liberalize the economy further through the more participation of private sector in government investment plans

Public private partnerships Types of PPPs Service contracts Management Contract O&M Concession agreement BOT Agreement Privatization Public private partnerships Less Private sector participation More

PPP legal framework Parliamentary Ad hoc committee on PPPs - Nov 2008 State Policy on PPP - Oct 15, 2009 to promote private sector participation in all sectors of economy The Law on Concession - Jan 28, 2010 Defines the processes of PPP implementation. In 2010, the Government has approved several regulations regarding the detailed bidding process and evaluation of bid proposals The Ministry of Economic

II. Public private partnerships today

In 2012, the Ministry of Economic Development was established. PPP policy formulation and implementation transferred from State property committee to Ministry of Economic Development.

Cabinet approvals in 2013 Amended concession agreement for “Telmen power plant” project. “Altanbulag-Ulaanbaatar-Zamyn-Uud highway” project “Tuul-Songino hydro charged power plant” project Amended list of concession projects.

“Nariinsukhait – Shiveehuren” road project Ongoing Projects “Nariinsukhait – Shiveehuren” road project Project description: 50KM MINING ROAD PROJECT Concession type: BOT Concession term: 17 YEARS Total cost: MNT 88.0 BLN Concessionaire: “RDCC” LLC Location: UMNUGOBI PROVINCE

“Telmen power plant” project Signed Projects “Telmen power plant” project Project description: 100KWT POWER PLANT PROJECT Concession type: BOT Concession term: 22 YEARS Total cost: $183.0 MLN Concessionaire: “New Asia Group” LLC Location: ZAVKHAN PROVINCE

“Altanbulag-Ulaanbaatar-Zamyn-Uud highway” project Signed Projects “Altanbulag-Ulaanbaatar-Zamyn-Uud highway” project Project description: 997 KM HIGHWAY PROJECT Concession type: BOT Concession term: 28 YEARS Total cost: $5.0 BLN Concessionaire: “CHINGGIS LAND DEVELOPMENT GROUP” LLC Location: DORNOGOBI, GOBISUMBER, TUV, DARKHAN, BULGAN, SELENCE PROVINCES

“Establishment of the mining and metal processing complex” project Signed projects “Establishment of the mining and metal processing complex” project Project description: Renovation and increase in capacity of the state owned JSC Darkhan Metal Processing Plant by utilizing the iron ore from state owned mines located in the Darkhan-Selenge belt Concession type: Renovate-Build-Operate-Transfer, Build-Transfer Concession term: 30 YEARS Total cost: USD 725.0 MLN Concessionaire: “QSC” LLC Location: Darkhan city

“Tuul-Songino power plant” project Signed Projects “Tuul-Songino power plant” project Project description: USE THE TREATED WASTE WATER FOR 100 MW HYDRO CHARGED POWER PLANT. Concession type: BOT Concession term: 23 YEARS Total cost: CNY 1.0 BLN Concessionaire: “MORIT IMPEX” LLC Location: ULAANBAATAR, SONGINOKHAIRKHAN DISTRICT

Projects at negotiation stage “Tavantolgoi-Khanbogd-Hangi” road project Project description: 435 KM MINING ROAD PROJECT Concession type: BOT Concession term: 17 YEARS Total cost: MNT 440.0 BLN Preferred bidder: “MCCC” LLC Location: UMNUGOBI, DORNOGOBI PROVINCE

Projects at negotiation stage “POWER PLANT #5” (CHP5) project Project description: 450 MWt POWER PLANT PROJECT Concession type: BOT Concession term: 25 YEARS Total cost: $1.2 BLN Preferred bidder: “GDF SUEZ, SOJITZ, POSCO, NEWCOM” LLC Location: ULAANBAATAR, BAYANZURKH DISTRICT

III. List of Concession projects

In 2010, the Government approved the list of 121 concession projects. In 2013, the Cabinet approved new list of 51 Concession projects

What is in the pipeline? Major infrastructure projects such as Power plants, Railroads and Highways, social sector projects The PPP project pipeline list is updated with more bankable and Government priority projects

What is in the pipeline? It is important to structure the projects with proper risk allocation between the Public and Private sectors and to implement the PPP program in accordance with international best practices The new list consists of 47 projects submitted by line ministries and 4 projects submitted by private sector

By sectors Infrastructure – 7 Road and transportation – 17 Pipeline transport – 2 Airport – 2 Energy -12 Environment – 4 Education - 2 Health – 1 Culture and sport - 4

By types of PPP BOT – 7 BOO – 12 BT – 19 OTHER - 13

Dalanzadgad airport Project description: REDESIGN AND BUILD EXISTING AIRPORT AT DALANZADGAD Concession type: DESIGN-BUILD-OPERATE-TRANSFER Concession term: 20 YEARS Location: DALANZADGAD SUM, UMNUGOBI AIMAG

Chandgana power plant Project description: 600 MWt POWER PLANT NEAR CHANDGANA COAL DEPOSIT, KHENTII AIMAG Concession type: BUILD-OWN-OPERATE Concession term: 25 YEARS Project total cost: $1.3 BLN Location: MURUN SOUM, KHENTII AIMAG

International standard horse racing stadium Project description: BUILD HORSE RACING STADIUM WHICH MEETS INTERNATIONAL STANDARDS Concession type: BUILD-OWN-OPERATE Concession term: 25 YEARS Project total cost: $100 MLN Location: SELENGE SUM, TUV AIMAG

THANK YOU www.med.gov.mn tsbatbayar@med.gov.mn