Economic impact assessment

Client: Oyu Tolgoi

Building trust through effective communication

Starting point

Facts versus feelings

Since the beginning of the millennium, Mongolia has attracted huge interest from mineral developers. Managing rapid resource sector growth, however, has come with challenges for both the country and investors. Oyu Tolgoi (OT) has undoubtedly been the largest and most iconic mining investment. Its sheer scale relative to the Mongolian economy has brought with it unparalleled opportunity, but also multiple layers of complexity.

Natural resource development is often a charged topic prone to politicisation. Moreover, OT’s structural features – including a complex investment agreement, reservations about the role of the private sector as resource developer, and an emotive public discourse – have exacerbated adverse public opinion in certain quarters.

Oyu Tolgoi is the largest single investment in the history of Mongolia.

Our approach

Targeting hearts and minds

Faced by the increased deterioration of its operating environment, OT became determined to reset key stakeholder relationships. A main task in this regard consisted in filling a significant information void. The challenge was not only providing cogent ammunition to improve public knowledge on the investment, but also articulating a project narrative that the country as a whole could relate to.

To a large extent, the task involved translating technical, complex, and often sensitive information across a multitude of project-related themes into clear, compelling, and easy to digest concepts. Additionally, it required a spotlight on the projected socioeconomic contributions, calling to unpack the outstanding claim that OT is nothing short of a nation-building development.

The outcome

An impactful publication

The study articulated fundamental OT features including a review of the Mongolian economy and mining sector, project ownership and operating structure, regulatory parameters, commercial considerations, social and environmental issues, among others. The work comprised specialist modelling to assess economic impact and discuss the resulting benefit sharing across stakeholders.

Produced for publication, the analysis was widely circulated in Mongolia amongst elected representatives, bureaucrats, international agencies, specialist, and non-specialist audiences. The study was designed to support all parties during crucial project negotiations – with Oyu Tolgoi shareholders ultimately agreeing investment terms for the decisive underground mine expansion.

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