Mining Journal Awards 2013 Defying the crisis

15th of 1, 2014
By N.Ariuntuya

Given the pall of gloom and uncertainty that hung over the whole mineral sector in 2013, we at the Mongolian Mining Journal were not sure if it would be right this year to organise the annual Mining Journal Awards. It was one thing to celebrate enterprise, performance and innovativeness when the going had been good, but would it not be ironic to seek to identify and acknowledge these at a time when most mining projects had been put on hold, survival had nudged out expansion, and goods and service suppliers vainly looked around for orders?
We left the decision to our panel of judges for the awards, and these wise people had no doubt that we should go ahead. A crisis in the mining sector was no more than a temporary setback, and should not hinder a tradition in the making, they said. And bad times bring out special qualities, not seen in better days, somewhat like stars sparkling only at night. Giving up on the awards would mean giving up the fight, they said, somewhat akin to abandoning the ship.

One of them, B.Purevtogtokh, was clear why we should organize MJA 2013 as usual. He told us, “The awards are for past performance but their true significance lies in how they encourage all of us to look to the future, giving us the determination to do better next year. Let us leave it to the companies. If we receive enough nominations, we shall assess their merits. If there are not enough competitors, or no real performance, we shall not announce a winner. Success comes in many forms, and our yardsticks in a year of crisis will be different from the usual. Not organising MJA 2013 would only heighten perception of the crisis. The players in the sector need to come out of the gloom, not be hemmed in further.” This sane approach dispersed all our doubts and we set in motion the long process of selecting winners of the fourth annual Mining Journal Awards, to be a major footnote in the chronicle of troubled times.

Categories of Awards 2013: one in, one out

MJA 2013 had the same categories as in the previous year, except for the judges’ decision to discard “The Supplier of the Year” award in favour of one for “The Best Stable Operations”.  Readers may recall that Wagner Asia LLC had won the supplier award in MJA 2012. They would face no real competition as every mine uses the Caterpillar equipment they supply. That was why the judges’ panel decided to eliminate this category.

The new category, one earnestly hopes, will be a temporary inclusion. To justify the rationale behind its present inclusion, we have to go back four years when we said the following, while announcing the institution of the awards,“At a time when, as elsewhere in the world, the mining sector in Mongolia faces challenges and obstacles, the Mongolian Mining Journal finds it all the more important to encourage individuals and organisations that are sustaining the industry and to publicly recognise their achievement.” Now that the sector is in the grip of a post-boom gloom, it was important to acknowledge companies which have managed best to face hard times. 

So “The Best Stable Operations” category is here, and the judges see it as a nonpermanent choice. D.Achit-Erdene, a financial expert who is also President of the MICC investment bank, was invited to join the judges’ panel for this category.

And the Winners are…

The crisis has been seen as a challenge, and those in the mineral sector didn’t stop working hard. The number of nominations showed a significant fall, but we had expected this, and the choices were from among contestants who tried to turn misfortune into opportunities.

Best Deposit: Baganuur coal mine.Others in the running were Oyu Tolgoi copper-gold mine, Ukhaa Khudag coking coal mine, and Shivee Ovoo coal mine.

This award went to Mongolyn Alt LLC in 2010 and to Erdenet   open  pit mine in 2011. There was no award in 2012 as most coal and ore companies had been forced by circumstances to stay idle. The situation was similar, if not worse, in 2013, but the judges took note of the fact that Baganuur’s output was the highest in its history.

Responsible Mining: Energy Resources. As the sole nomination in the category, the company could not be called the winner, but the judges noted how its performance easily met all the criteria. Having contested with outstanding scores for an award in all categories except Best Explorer in previous years, the company received the MJA Grand Prix on two consecutive occasions. This time, Energy Resources did not get chosen for any award, but its performance was noted and lauded.

Usually, this category sees the most exciting contest between heavyweights in the sector. The criteria are extensive: progress in processing,EITI report, adoption of international standards ISO 26000, ISO 1400, ISO 1900 and OHSAS 18001, and such. Almost all nominations in the first year were foreign invested companies, but it was gratifying to find several national companies feeling bold and confident enough to compete in 2011 and 2012.
The crown went to Energy Resources in 2010 and 2011, while last year’s winner was Erdenet Mining Corporation.

Best Green Mine: Oyu Tolgoi copper and gold mine. The judges were impressed by the extent of studies, research and planning the company did before beginning to mine, and hoped these admirable standards would be maintained all through the mine’s life.

With the spread of environmental awareness and understanding of how mines can rehabilitate ecological destruction,this has always been the most popular category, with the number of contestants reaching even 20 one year. This year, however, there were only six:Monpolymet Group’s Toson gold placer mine, Shivee Ovoo coal deposit, Darkhan Metallurgical Plant’s Tumur Tolgoi iron ore open pit mine, Oyu Tolgoi LLC with its Oyu Tolgoi copper-gold mine, Energy Resources LLC’s UkhaaKhudag deposit, and Mining National Operator’s Bayangol gold placer mine. This was MNO’s debut in the event. Its team consists mostly of Mongolian engineers who had earlier worked in Boroo Gold LLC and they are following western standards as MNO leads the project management team at the Baruun Tsankhi coalfield of Tavan Tolgoi.
The award went to Baganuur coal deposit in 2010, and in 2011to Erlian’s coal deposit rehabilitated by Peabody Winsway Resources. Last year’s winner was Boroo Gold.

Best Technology:
Andritz Separation’s technology at UkhaaKhudag coal processing plant that dehydrates the waste and recycles the water content of the waste.The award was a re-assertion that the Mongolian mineral sector can and does use the latest advanced technology. The judges found special merit in the Austrian company’s technology that saves water, the most valuable resource especially in the Gobi.
The unsuccessful but worthy contestants were: HSE Systems with its software of labour safety and health management, Wagner Asia with its S-O-S liquid examination laboratory, and Energy Resources’ advanced technology at Ukhaa Khudag.

Erdenet Mining Corporation  won the award in 2010 with its new technology, and the next two years it was the turn, respectively, of Tavan Talst LLC’s coal drying technology adopted at Shivee Ovoo deposit and Erdmin LLC’s technology for cathode copper.

Best Stable Operations: Wagner Asia.In 2013, risk management was the need of the hour and name of the game. Did any mining-related company manage to grow when others were fighting to survive? Did any company make fresh investments during the year of challenge? What new management strategies were applied? The judges found Wagner Asia the best among four contestants.
The other companies considered were:Energy Resources, Shivee Ovoo and Baganuur LLC.

Explorer of the Year: No nomination, no winner.The category was introduced in 2011, during the boom years, when there was a rush for new exploration work. Many of them, both international and Mongolian, are still there but 2013 was a year of inactivity for all because of the ambiguous legal environment. Thus no company came forward with a claim to the award.

In 2011, the award went to Hunnu Coal for its success with 15 projects in Mongolia and for implementing the JORC standard in some of its estimated reserves. It also became the first company with Mongolian management and a Mongolian CEO to have an IPO in an international stock exchange. That IPO was the most successful of the year in the Australian Stock Exchange. Next year’s winner was Centerra Gold Mongolia, operating in Tsagaan Ovoo soum, Dornod aimag.

MINING JOURNAL AWARDS chronicle development

The MMJ Awards were instituted to contribute to the positive atmosphere in the development of the mineral sector, by encouraging mining companies to act innovatively and responsibly. We also wanted them as active participants in the event.

With major companies sending in nominations, the stage was set for serious contests, demanding impartial and competent evaluation. As organiser of the event, we accepted the responsibility and we are grateful our role has been appreciated. Our hope is that in the years to come,the Mongolian mineral sector will have a place of honour among its global peers. The MMJ Awards are the milestones on that way.

MMJ is proud of the response the event generates, and congratulates winners and other contestants. Our job is to help make society develop the right and healthy understanding of the sector, how it works, the challenges it faces, and the joys of its success.

We wish to encourage our readers to go and visit Ukhaa Khudag complex deposit run by Energy Resources LLC and see the construction work taking place there. Check out the water recycling technology used there. Go and visit the site of Oyu Tolgoi and marvel at what now stands on what was bare ground. Go to any reasonably big mine and see for yourself the sophisticated equipment that Wagner Asia supplies. Go to Baganuur and see how extraction is done. Go to any mine named in this report and gain a new understanding of the sector that drives the national economy, thus playing an unacknowledged but crucial role in every individual Mongolian’s life.

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