TOKYO (majirox news) – Politics makes strange bedfellows and so does bidding on huge international projects. Mongolia has just finished the second round of bidding for an open pit coal mine, which experts believe will be the largest in the world when completed.
“The mine has estimated reserves enough to supply Japan’s entire coal needs for at least the next 30 years,” claims the Asahi Shimbun.
Japanese trading companies will naturally be bidding on Mongolia’s gigantic project and have joined into bidding groups with foreign companies. The most interesting one involves a consortium of the four largest Japanese trading houses, South Korea’s leading natural resources company and Russia’s state owned railway system. Makes you wonder what became of the fuss and fury over the “Northern Territories” or was it the South Kuriles? Japan and Russia have been quarreling about these four smallish islands since the end of World War II. These islands are currently held by Russia, but claimed by Japan.
Mongolia with its vast, empty spaces and comparatively small population may be a treasure chest of undiscovered natural resources. Sandwiched between Russia and China, which may be the country’s biggest customers who seek to dominate it and every new project to tap Mongolia’s untold wealth.
It is not just a commercial project, but also a difficult diplomatic dance. While mollifying China and Russia on one hand, Mongolia is eager to have other foreign investors to maintain a modicum of independence.
As the world’s 10th largest producer of natural resources and mine production accounting for 33 percent of GDP as well as 78 percent of exports, it’s well on the way to becoming another Australia, but one without the comfortable certainty that the entire Pacific ocean lies between them and their most eager customers.