December 25 marks the 100th anniversary of the development of the mining sector in Mongolia as the country commenced the operation of its first mine on this day in 1922. The timeline started on this day as it laid the foundation for the development of the modern mining industry.
Although the history of development is measured by only one century, extraction of metal ore and metallurgical industry development traces back five thousand years ago, which is proven by archeological findings and historical sources found in Mongolia.
The key event in the 100-year history is the Nalaikh coal deposit, the first mine in the country mentioned above. Since the People’s Government decided to take over the operation of the Nalaikh coal mine, which was originally operated by Chinese people, it has been providing the coal needs of the capital city for a century. The mine saw its golden years during socialism. The first underground mine, the first paved road to the mine, and the first railroad were all linked to the mine. However, along with the collapse of the socialist regime in Mongolia, the largest mine that employed over a thousand people also collapsed due to an accident. The ruins of the Nalaikh mine quickly became a den of “ninjas” (artisanal miners), and it tells the bitter lesson of an abandoned mine that has not been closed properly and is located on the outskirts of the capital city. Although the history of a mine that once flourished has seen a grim ending, mining as a whole has become a pillar of Mongolia’s development in these 100 years. Mongolia’s 100-year history of mining is a story of stepping up from a socialist raw material base of the Soviet Union to an independent modern country based on mining resources.
This 100 years passed the historical transition from socialism to democracy and a closed economy to a free market. The last 30 years have been the history of a new era for Mongolia, which established new rules and regulations for the mining industry following the new economic system and became an official participant in the global mining industry. When democracy chose the free market, Mongolia sought to understand modern mining, made efforts to bring light to their mineral resources on the global stage, implemented an open policy aimed at attracting foreign and domestic investments, and developed policies and finances that were mostly focused on this sector. The development of the industry has intensified, investments have reached their peak, and there have been major discoveries in the exploration of gold, copper, coal, and uranium. But the basis of all this was the legacy of socialism. It is a history of development based on the deposits and mines that were discovered and established in those years, in which a large base of skilled labor was created.
In these 100 years, the export direction has changed from the northern neighbor to the southern neighbor. It is a history of being 90 percent dependent on the southern neighbor for exports, despite being freed from the fate of being a supplier of raw materials to its northern neighbor, and following the principles of a free market and democratic supply and demand. This is the story of Mongolia, which is trapped between two neighboring superpowers and is following its destiny. During this period, the coexistence of private, open, state-owned, and publicprivate joint ownership forms gave birth to special projects such as Oyu Tolgoi and Tavan Tolgoi, which will have an impact on the development of the country for more than one human lifetime. Also, national mining businesses such as MAK, Monpolymet, Bold Tumur, Eruu Gol, and Energy Resources, which have engraved their names on Mongolia’s economy and market, have emerged. Erdenet Mining Corporation and Mongolrostsvetmet joint ventures were established in the second half of the 20th century and played a significant role in the history of the development of Mongolia. Also, the coal mines of Baganuur, Sharyn Gol, and Shivee-Ovoo, which lit the heart of the country, have been performing their duties through both social systems.
In a 100-year cycle, Mongolian miners have grown to 50,000 and created an industry with an export income of USD 6 billion, accounting for 25 percent of GDP and 93 percent of export products and leading the economy.
Also, the sharp rise in the price of minerals helped the country to allocate about USD 4 billion to the public in less than 10 years under social welfare. It is also a time when theft, corruption, and embezzlement spread further. This is the history of Mongolia’s mining and journey of both failure and success. Regardless, the country is destined to correct its mistakes and move forward. With such a rich history, Mongolia’s mining industry is starting a new century towards a better future, keeping pace with the progress of global mining trends. Happy 100th anniversary to everyone involved in the field of geology and mining in Mongolia. All of you deserve respect. Generations of people devoted their efforts to the development of the mining industry, exploration, extraction, and processing of mineral resources and turning them into a great opportunity for national development. Also to our dearest readers, we wish you the best.
