Contract transparency: Mongolia

Mongolia’s 2013 EITI Report documented considerable confusion about the government’s policy on contract transparency.

When approaching companies for copies of the Production Sharing Agreements (PSAs), the Independent Administrator, the firm producing the EITI Report, was told that the companies had no objection to the Petroleum Authority of Mongolia (PAM) releasing copies of the PSAs. However, senior officials of PAM refused to provide the PSAs explaining that confidentiality restrictions prevented the disclosure of PSAs without the agreement of the companies. The Independent Administrator then wrote to the Minister of Mines requesting a statement on the government’s policy on contract transparency.

The Deputy Minister responded, stating “As per the law currently in force, there is no regulation covered confidentiality (sic) in major terms of Production sharing agreements to be included in the “Extractive Industries Transparency Initiative 2013” reconciliation report. Therefore, there is no confidentiality issue affecting your request.”

The 2013 EITI Report recommended that the National Council should work with the Ministry of Mines to ensure that information on contracts is made public in accordance with government policy.

To follow up on this recommendation, the Government of Mongolia has taken several actions on the disclosure of contracts and licenses, including:

  • Appointment of former Minister of Mineral Resources and Energy, D. Zorigt, to start improving the transparency of information relating to investment agreements and petroleum PSAs.
  • Passing of Resolution 222 to make petroleum PSAs publicly available.
  • Approval of templates for typical PSA agreements.
  • Publication of 12 contracts on the EITI Mongolia website and development of a contracts portal in 2016 with over 30 contracts initially published.
  • In addition, the establishment of a government policy on the minerals sector, which was approved by the Parliamentary Resolution #18 in January 2014, set the stage for the implementation of the recommendations on contract transparency. The intention behind the policy is to develop open, transparent, and responsible mining.