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A Canadian-based mining company Jan. 14 announced that the governments of Mongolia and China plan to conduct a joint study — along with the firm — of a proposed 180-mile rail line between the countries.
The two countries plan to build the line between Bayan Obo, China, and Ivanhoe Mines Ltd.’s gold and copper mining rights in Oyu Tolgoi, Mongolia.
The line might be extended to a large Tavan Tolgoi coal deposit held under license by a private Mongolian mining group.
Bayan Obo is connected to China’s national railway network and is about 62 miles north of Baotou, a major industrial center that includes a large, regional steel industry.
Ivanhoe Mines officials believe the line would be a catalyst for new, international investment by developing Mongolia's resources, and provide the company a strategic, geographic advantage when it establishes copper production in Mongolia.
A 1999 study conducted by mining firm BHP Billiton estimated that it would cost $94.7 million to build a line from Bayan Obo, crossing generally flat terrain, to future mines in Mongolia's southern Gobi region.