RE: Refinery2 Nov 2024 16:26
The most recent information is that the refinery will be operational in August 2027. All very positive for long term investors. Perhaps there’s a difference between being complete in 2026 and being operational , or perhaps those who have repeatedly claimed 2026 were being selective with the facts.
“Minister of Industry and Minerals, Ts. Tuvaan, presented the issue of accelerating the construction of the oil refinery at the Mongolian People's Party (MPP) meeting. He provided updates on the progress of the refinery, the construction of the oil pipeline, and the development of the workers' residential area. The project to establish an oil refinery with a $1.2 billion loan from India began in 2019. The work was divided into four packages, and the first package is nearing completion. The second and third packages are currently underway, but there is a shortage of funds for the fourth package, which requires an additional $431 million. This issue arose due to the significant rise in construction costs after the pandemic.
To resolve this, an agreement was made to secure an additional $431 million from India's Exim Bank. This will ensure the project continues without interruption, with the refinery planned to be operational by August 2027. The additional financing agreement needs to be finalized quickly.
Currently, companies such as PetroChina Daqing Tamsag and Dongsheng are extracting oil. This year, it is planned to extract about 530,000 tons of crude oil, but once the refinery is operational, there will be an additional demand for about 1 million tons of crude oil. The government will collaborate with extraction companies and announce new exploration fields. For instance, Petro Matad LLC will start extraction operations on October 25, 2024. Recently, during a meeting in China, the Prime Minister held a meeting with the head company of PetroChina Daqing Tamsag to discuss increasing oil extraction.
The contracts for all four packages are on schedule, and for the fourth package, the project must be completed within 36 months after the agreement is signed. The project, valued at $1.6 billion, aims to be completed swiftly as the loan will be repaid by the Mongolian people, making it essential to ensure the refinery becomes operational in the shortest possible time”
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