Eric Watkins
Oil Diplomacy Editor
LOS ANGELES, Oct. 13 -- Mongolia's Mongolsekiu LLC and Toyo Engineering Corp. have formally submitted plans to the Mongolian mines and energy ministry for construction of the country's first oil refinery, a 44,000 b/d facility to be built at Darhan near the border with Russia.
The total cost of the joint venture project, held 60% by Toyo and 40% by Mongolsekiu, is estimated at more than $1.2 billion, with the costs largely to be underwritten by the Japanese government and the Japan Bank for International Cooperation.
Construction is expected to begin next spring, and a pilot plant is expected to start operating in first-half 2010. The completed refinery will work at full capacity from June 2012.
"When it starts working, the refinery should relieve Mongolia of its stifling dependence on foreign fuel," Mongolian state media said.
While the refinery at Darhan may reduce Mongolia's dependency on imported products, crude for the facility will come from Kazakhstan, which plans to deliver 1-1.5 million tonnes of oil in the coming year.
"[The] president of Kazakhstan accepted our proposal on the delivery of 1-1.5 million tons of crude oil to Mongolia from Kazakhstan," said Mongolian president Nambaryn Enkhbayar on a state visit to Kazakhstan in August.
Contact Eric Watkins at [email protected].
