1. In accordance with the Petroleum Law of Mongolia, the PETROLEUM AUTHORITY OF MONGOLIA (PAM) is a Government agency, authorized by the Government of Mongolia to enter into contracts related to petroleum operations and exercise supervision over its implementation.

2. Petroleum Sector – - One of the Mongolian Government’s Top Priority Sectors

3. Ministry of Industry & Trade;
The Government;
Ministry of Industry & Trade;
Petroleum Authority
Contractor
Mutually
beneficial
cooperation

4. In order to attract foreign investment and expertise to petroleum sector Mongolia has established FAVORABLE AND STABLE LEGAL ENVIRONMENT

6. Production Sharing Contract
Contractor Government
100%
Cost recovery Royalty
(up to 40%) (up to 12%)
Profit Oil
Contractor Government
share share

7. Terms EXPLORATION PERIOD
The term of Exploration period might be up to five (5) years and may extend for two (2) times, by two (2) year extension terms, each. 
PRODUCTION PERIOD
The term of Development Operations might be up to twenty (20) years and may extend for two (2) times, by not more than five (5) year extension terms, each.

8. PETROLEUM OPERATION; CUSTOMS TAXES = 0 VALUE ADDED TAXES = 0
EXCISE TAXES = 0
INCOME TAXES = 0

9. No taxation changes for 10 – 15 years
The Government
Investor
Stability Agreement
STABILITY AGREEMENT;
No taxation changes for 10 – 15 years

10. FAVORABLE LEGAL ENVIRONMENT; The Petroleum Law of Mongolia-
-one of the top 10 petroleum laws
(AAPG, Explorer, Aug. 1995,
van Meurs rates)

11. STABLE LEGAL ENVIRONMENT; No changes in petroleum operation-
related legislations
since 1991 for 12 years

12. MONGOLIA; - RISK FREE POLITICALLY - ECONOMICALLY OPEN - NO ETHNIC CONFLICTS

13. More advantages; High number of exploration block acreage 24 exploration blocks (average acreage – 24,000 sq. kms)

14. Despite the initial stage of exploration, oil reserves confirmation billion bbr - Tamsag basin million bbr – Block XIX

15. Similar to Northern Chinese producing basins
* Similar to Northern Chinese producing basins * Experienced sub-contractors available * Chinese exploration data are possible for correlation study * Near to potential market

16. Brief history of Mongolian Petroleum Industry
1922-Initial Petroleum Exploration in Mongolia
1940-The first discovery of oil in place-Zuunbayan oil field
1969-Inactivation of the petroleum operation
1990-Re-activation of petroleum exploration
1991-Commencement of “Petroleum” program and, Ratification of the Petroleum Law and its Implementing Regulation

17. PSC - SOCO international, USA – XIX, Xxi, XXII
PSC - Dongsheng, China – XIII, XIV
Seismic exploration – Electro Silica – II, III, IV, V, VI, VII, VIII, IX

18. SOCO Statistics Seismic exploration: 2D – 6282 str. km 3D – 233 km2
Drilling: 20 drillholes (since 1995)
Oil Export: 180,000 bbr oil
(since 1998)
Investment: 70 million USD

20. ROC Oil Statistics Seismic exploration: 2D – 2745 str. km
Drilling: 5 drillholes (since 1995)
Oil Export: 151,000 bbr oil
(since 1998)
Investment: 55 million USD

22. PIPELINE PROJECTS IN MONGOLIA

23. Mongolian sedimentary basin

29. Seismic exploration

30. Exploration Drilling

32. Geochemical data of crude oil
Characteristics
Unit
Block name & Well No.
Toson Uul
XIX-3
Tsagaan Els TE-14
Density
g/cm3
0.842
0.885
Pour point OC 27 29
Boiling point 80 90
Viscosity
mm2/sec (50OC)
5.6
4.1
API density
API (15.6OC)
36.4 28
Sulphur content %
0.01
0.14
Water content
0.2 10

33. Horse head-production unit

34. Crude oil storage

35. Oil transportation

36. Detailed information is available at our website;

37. Very much appreciated for your kind attention