- Purging of government agencies becoming routine after electons
- Directors helped unlock $4.4 billion in investment for mine
Three board members that helped steer the Oyu Tolgoi copper mine out of a long-standing dispute between the government of Mongolia and Rio Tinto Group have been dismissed.
Byambasaikhan Bayanjargal, Ganbold Davaadorj and Otgochuluu Chuluuntseren were released as board members on Friday, according to Solongo Sukhbaatar, a spokeswoman for Erdenes Mongol LLC, which holds state stakes in resource assets such as the Oyu Tolgoi mine.
Mongolia has seen many executive departures since the Mongolian People’s Party came to power in late June. The changes aren’t uncommon as the winning party consolidates power and finds loyal members to assume executive roles, said Munkhdul Badral, head of market intelligence firm Cover Mongolia.
“Public service is often the biggest victim of any political shift in Mongolia. It has become a ritual of a new ruling party to ‘cleanse’ the leaderships of government agencies and SOEs of the previous administration,’’ Badral said in an e-mail from Ulaanbaatar. “This time was no exception.’’
The trio was instrumental in negotiating a settlement with Rio Tinto after Mongolia and the mining firm clashed over a range of issues that left the underground mine stalled for more than two years. An investment accord signed late last year opened the door to $4.4 billion to restart the mine.
After the MPP won 65 out of 76 seats in the Great Hural, many of those employed by the former government headed for the exit. Earlier this month, Byambasaikhan resigned from his position as chief executive officer of Erdenes Mongol. Otgochuluu left his post as the company’s chief economist.
Munkhbaatar Begzjav, a former deputy mayor of Ulaanbaatar, replaced Ganbold as executive director of Erdenes Oyu Tolgoi LLC.
Erdenes Mongol is the parent company of Erdenes Oyu Tolgoi, which holds a 34 percent stake in Oyu Tolgoi LLC, owner of the Oyu Tolgoi copper mine. Turquoise Hill Resources Ltd., which Rio Tinto controls through a 51 percent stake, owns 66 percent of the Oyu Tolgoi deposit. A Rio Tinto spokesman declined to comment on Tuesday.
The Oyu Tolgoi LLC board includes a chairman and eight members. Replacements for the three departing Mongolian members have not been announced yet, said Solongo. Munkhbaatar, the new head of Erdenes Oyu Tolgoi, is a strong candidate to join the board, Byambasaikhan said in an e-mail.