Mongolia may lift ban on new mining exploration permits -minister

TORONTO, March 5 Wed Mar 5, 2014 1:56am EST

TORONTO, March 5 (Reuters) - A moratorium on new mining exploration licenses in Mongolia could be lifted during the spring session of parliament, Mongolia's mines minister said, as the Asian country works to lure back foreign investment after a slump last year.

A ban on the issuing and processing of licenses has been in place since June 2010, leaving in limbo many projects in the mineral-rich country wedged between China and Russia.

But that could change for some if parliament addresses "many discrepancies" in previous mining laws next month, Mines Minister Gankhuyag Davaajav said late on Tuesday.

"I do believe that ... in the spring session we should be able to have this resolved," Davaajav told Reuters following a Mongolia business conference in Toronto.

Foreign direct investment in Mongolia has dropped for the past two years, coinciding with a string of moves by the government that discouraged stakes in copper and coal.

In an about-turn, the parliament last November passed an investment law that gives equal treatment to foreign and local investors to try to tempt back investors.

Davaajav said Mongolia had made mistakes in the past but that it would "never repeat" them. His speech at the seminar was entitled "Mongolia is open for business".

He did not, however, directly address the issue of 106 exploration licenses that were annulled last year as part of an investigation into mining sector corruption.

Canadian mining company Centerra Gold Inc. said in January that it was "quite optimistic" it would be able to get back to work soon on its Gatsuurt exploration project in Mongolia, which has been suspended since 2010.

Gatsuurt has been included on a list of mineral deposits of "strategic importance" for the Mongolian government to consider. Centerra is hopeful that parliament will approve the list this year, opening the door for it to resume exploration on the property.

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