The document summarizes plans for developing two major mining projects in Mongolia: the Oyu Tolgoi copper-gold mine and the Tavan Tolgoi coking coal deposit. For Oyu Tolgoi, it describes existing reserves, planned production levels up to 56 million tons per year, and construction progress. For Tavan Tolgoi, it outlines plans to establish a state-owned company to mine over 6 billion tons of reserves, including selling shares to Mongolian citizens and companies and selecting strategic investors through an international bidding process.

1. Таван толгой төслийн Ажлын хэсэг
Erdenes MGL LLC
March 2011
DEVELOPMENT OF
MONGOLIA'S WORLD-CLASS MINING:
OT AND TT PROJECTS

2. ABOUT ERDENES MGL
• Established in 2007
• Represents government interests in development of strategically important deposits
• Participates in the Government Working Group’s work and in preparing investment
agreements and contracts and conducting studies of deposits in collaboration with
international advisers/consultants
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3. OYU TOLGOI LLC
34 %
Mongolia’s
Government
“Erdenes MGL”
66%
Rio Tinto
Ivanhoe Mines
 World-class copper-gold deposit
 Investment Agreement concluded on October 6, 2009.
 Agreement effective since March 31, 2010.
OYU TOLGOI PROJECT OVERVIEW
Oyu Tolgoi Project:
• First largest mining project in Mongolia since 1990
• Starting point of Mongolian’s mining development
• Intensive construction work of the project has commenced
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4. OYU TOLGOI PROJECT
There are total 45 million tons of copper, 1800
tons of gold and 6450 million tons of ore
reserve contained at Oyu Tolgoi (OT) based
on a 0.3 equivalent to each metal.
According to the Implementation Plan, Oyu
Tolgoi LLC will extract a maximum of 56
million tons, and a minimum of 26 million tons
of ore per year.
Planning to built concentrator by 2012.
• Phase I - 35 million tons per year for the
five-years.
• Phase II - Oyu Tolgoi LLC will transport
minerals by railway and will advance the
concentrator’s production capacity to 58
million tons of ore.
Ouy Tolgoi progress
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5. TAVAN TOLGOI COKING COAL DEPOSIT
Tavan Tolgoi is one of the largest coking coal deposits in the world
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6. TAVAN TOLGOI DEPOSIT OVERVIEW
• Total over 6.0 billion tons of coal, out of which:
• 1.4 billion tons of coking coal
• 4.6 billion tons of thermal coal
Reserves*
• Gobi Region in southern part of Mongolia
• 540 km south of Ulaanbaatar, capital city
• 270 km from the Chinese border
Location
• All infrastructures (electricity supply, railroads,
roads, water, supply etc.) need to be developedInfrastructure
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*- Conversion of coal resource into JORC standard increases coal resource, in particular,
coking coal

7. COAL MINING BLOCKS
West Tsankhi Block
East Tsankhi block
1204 M tons*
65 % coking coal
1078 M tons*
78 % coking coal
Eastern Coalfield
Borteeg
Coalfield
South-western
Coalfield
Resource estimated by JORC code
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Bor tolgoi
Measured
Indicated
Inferred
* In-Situ Coal Resources at 200m Depth Limit
392.9 M tons
1203 M tons*
48 % coking coal
765 M tons*
62,5 % coking coal
As Norwest’s preliminarily estimated TT In-Situ coal resources according to the JORC code, there are 7.5 billion tons of
thermal and coking coal within 300m depth range limit .
Norwest’s preliminary resource estimate

8. ERDENES-TT MINE (EARTERN TSANKHI)
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Tavan Tolgoi Project
Bid Coal Block
Erdenes-TT Mine
15 Mtpy ROM
Bidding of the Contract Miner for Tavan Tolgoi Coal Deposit (Eastern Tsankhi)
 Bidders submitted their proposals
 Final stage of the selection process is going on

9. PARLIAMENTARY RESOLUTION NO.39
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1) To ensure that a state-owned company conducts mining operations at the Tavan Tolgoi coal deposit, and subsidiary
Erdenes Tavan Tolgoi is established in compliance with corresponding laws and undivided mining licenses for the deposit –
transferred to it and investment agreement – entered into with it, and operator, corporate entity, – allowed to conduct
mining operations for a specific period;
2) To take the following measures to allow Mongolian citizens and national corporate entities to own and sell up to 50
percent of the shares of Erdenes Tavan Tolgoi company, mining licensee of the Tavan Tolgoi coal deposit, on domestic and
international stock changes, according to corresponding laws at different phases:
a) To allow all Mongolian citizens to own 10 percent of the shares free of charge in the first place in equal
amounts;
b) To sell 10 percent of the shares to national corporate entities, that are registered with state registration
on or before June 30, 2010, that conduct operations, and that have paid taxes in equal amounts and at
nominal price;
c) To sell up to 30 percent of the shares on international and domestic stock exchanges and raise
necessary investment;
A working group consisted of representatives from corresponding 9 institutions such as the State Property
Committee, General Taxation Authority, and General Agency for State Registration, mandated to do
preparation and organization of offerings for citizens and national corporate entities, is in operation.

10. STRATEGIC INVESTORS SELECTION
Prequalification of the Company/Consortium to Invest and Cooperate in the
Tavan Tolgoi Coal Deposit (Western Tsankhi)
 Announcement of the open prequalification, December 8, 2010
 Bid submission deadline January 31, 2011
 Evaluate bid proposal, create shortlist
Currently, Government’s Working group are holding negotiations with shortlisted
company/consortium
• Coal Work Contract with Erdenes Tavan Tolgoi JSC
• Peabody Energy, USA;
• Consortium of Shenhua Energy, PRC, and Mitsui Co Ltd, Japan;
• Consortium of Russia’s Railway, Japanese Consortium, and Korean Consortium;
• Vale (former CVRD), Brazil;
• Xstrata Coal, Australia;
• ArcelorMittal Limited, Luxembuorg.
Shortlisted bidders

11. CONSULTANTS
Companies to provide consulting services on IPO execution of part of the shares of
Erdenes Tavan Tolgoi on stock exchanges
• International investment banks:
- Goldman Sachs, USA
- Deutsche Bank, Germany
- BNP Paribas, France
- Macquarie, Australia
1-2 additional banks
• International Audit Firm/Consultant
• Legal Consultant
• Technical and Resource’s Consultant
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12. Preparation* Erdenes-TT Details
Resource (reserve) Report in accordance to
JORC standard
 6 billion tons resource. Convert to International
JORC standard
Contract miner (operator)  Tender is in process
Coal quality
 Coal quality study has been done on Tavan
Tolgoi coal deposit
Sale of production  Initial stage
Production level
 Mine box-cut has been started on site and
uncovered the coal seam
Financing  In stage of preliminary discussion
Road
 Utilization of the currently constructed road
 Build new road
Railway
 Resolution on State Policy on Railway
Transportation
Power plant  Research, Feasibility study
Wash plant  Research, Feasibility study
Water supply  Research, Feasibility study
*Preparation work can be done and commenced within 1 year by Erdenes-TT
ERDENES-TT: IPO
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Tavan Tolgoi Project

13. CHPP AND WATER SUPPLY
Construction of the Coal Handling and Processing Plant
Coal processing plant:
• Three 900 ton/hour modules
• 15 Mtpy capacity
Coal handling and blending
• 5000 ton/hour
• Refuse handling
• Loadout conveyer facilities
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Production:
• At least 7 million tons of clean coking coal
• 4 million tons of thermal coal
• 1 million tons of middling
Tavan Tolgoi Project
Dalanzadgad
Sainshand
Zuunbayan
Tavan Tolgoi
Оюу толгой
Gashuun
sukhait
Zamiin-Uud
Khangi
Balgasiin Ulaan
Nuur
Balgasiin Ulaan Nuur underground water
deposit:
• 70 km from Tavan Tolgoi deposit
• Resources of 465 l/sec
• Additional water exploration in
the region
Construction of the integrated water supply system to support mine operations

14. POWER SUPPLY AND SITE DEVELOPMENT
Up to 600 MW installed capacity power plant:
• Mine operations
• Coal Handling & Processing Plant
• Camp and local miners’ town
• Water supply system
• Support infrastructures
• Other local users
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Tavan Tolgoi Project
Construction of the mine camp and
development of the town
Miners town development:
• Permanent resident housing
• Support in town infrastructure development
• Medical center, daycare, schools and other social
support facilities
Mine camp:
• 600 miners accommodation
• Office, warehouse and support
• Workshops

15. MASTER PLAN
Bid Coal Block
(WesternTsankhi)
Eastern Tsankhi
Eastern
coalfieldBor teeg coalfield
Ukhaa khudag coalfield
Tsogttsetsii Town
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Erdenes-TT Mine
Tavan Tolgoi Project

16. MONGOLIAN RAILWAY DEVELOPMENT STRATEGY
• Construction of new railway to connect with Trans Mongolian railway
• TT-Sainshand, Sainshand-Choibalsan
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Tavan Tolgoi Project

17. ASIA PACIFIC MARKET
Marketing of the Tavan Tolgoi coal

18. Unit 37, Diplomat Bldg. 95
khoroo 5, Chingeltei district
Ulaanbaatar, Mongolia
Tel: (976) 7011-0735
Fax: (976) 7011-0725
www.erdenesmgl.mn
Erdenes MGL LLC