Mongolia moves to develop rare earth riches, balancing interests
Mongolia is keen to tap its vast rare earth resources, vital to technologies from wind turbines to EVs. Yet turning minerals into production requires navigating complex licensing and local concerns.
Several promising sites with valuable neodymium and dysprosium are in western and southern Mongolia. Their remote locales pose infrastructure hurdles. Also, licenses are often held by private banks as loan collateral, limiting state control.
As Mongolia eyes a larger stake in rare earths, upcoming new legislation may classify them as “strategic” minerals. This could require parliamentary approval for projects, altering ownership structures. The state stresses community views will help guide development.
One critical area at Khalzan Burgedei in Khovd province contains around 30 percent of Mongolia’s rare earth elements, according to estimates. Its license sits with the Trade Development Bank, which has sparred with officials over other mines.
Local herders have raised worries about radiation and environmental impacts. This led to a temporary license suspension, although the firm insists no radioactivity threat exists. Engaging communities and addressing anxieties will be key.
Mongolia boasts the world’s largest known rare earth reserves, totaling up to 21 million tons. Global demand for vital rare earth magnets and elements is climbing, as they are essential for electric vehicles, wind turbines, electronics and medical gear.
Among the minerals, neodymium offers versatile applications from medical gear to phones to potent magnets for EVs. And Khovd along with Umnugobi hold promising amounts.
Global demand for neodymium magnets is seen growing 7.5% yearly through 2040.
With few alternative sources, Mongolia is positioned to profit and support its development needs. Buw ensuring local buy-in and balancing economic priorities will require deft policymaking. Tackling hurdles like infrastructure and bureaucratic snags is also crucial along with accessing global markets beyond China.
The government stresses its commitment to sustainably harnessing Mongolia’s mineral wealth. The new legal tweaks may demonstrate a will to exert greater control over rare earth resources while working cooperatively with license holders.
Striking the right balance can potentially turn Mongolia’s strategic location and geological blessings into shared gains. Managing rare earth riches responsibly affords opportunities to deliver prosperity and technological progress and ultimately reduces dependence on coal exports.
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