Tavan Tolgoi Power Plant

Project
Brief Introduction

MONGOLIAN POWER SECTOR PROJECTION

/, project impact/

According to the power sector projection, in the near 20 years, 100-200 MW power capacity
shall need to be created every year.

MONGOLIA POWER SECTOR INVESTMENT

By 2030, total estimated investment amount required in

the power sector will be approximately 10.26 billion
USD:
(i) CHP in the CES 4.0 billion USD
(ii) UB heat supply expansion 0.35 billion USD
(iii) New plants in the Southern region 2.0 billion USD
(iv) In other energy systems 0.75 billion USD
(v) Provincial center heat production and supply 0.26
billion USD
(vi) Transmission line expansion 1.7 billion USD
(vii) Distribution line expansion 1.1 billion USD

Mongolian power sector

Approx. 10 billion USD in 15 years

POWER PROJECTS IN MONGOLIA

R

EGHPP 315MW

Shuren 300MW

Baganuur 700MW
Dornod 100MW

Chandgani 600MW

Baganuu
r

Eastern
Energy
Shivee Ovoo 600 1200MW
System
Choir

CHP5 450MW

Central Energy
System

Mandalgobi

Tevshiin Gobi 600MW

Southern grid
system

TSAGAAN SUVARGA

Tsogttsetsii 250W (Wind)

TTPP 450MW

TAVANTOLGOI

OYUTOLGOI

Dalanzadgad

Sainshand 52MW (Wind)

Khanbogd 250MW (Wind)

Western Energy
system
Altai Uliastai
Energy System

IMPC

TTPP LEGAL BACKGROUND

INITIATION OF THE PROJECT

By the Government resolution #71 dated March 2, 2013 on Actions for undertaking large developmental
projects and the Government resolution #80 dated March 7, 2013 on Project financing, the
Government of Mongolia (GoM) proposed to develop a 450 MW coal fired power plant in the Tavan
Tolgoi area.

ESTABLISHMENT OF THE PROJECT UNIT

In Accordance with the order #36 dated March 19, 2013 of the Minister of Energy on The establishment
of the Tavantolgoi power plant project unit the development of the Project is being led, on behalf of the
GoM, by the Tavan Tolgoi power plant project implementation unit under the Ministry of Energy
(the Project Unit).

SELECTION OF INVESTORS
In Accordance with the order #50 dated April 18, 2013 of the Minister of Energy on Investor selection
and negotiation GoM is now seeking to select, through a competitive selection process, experienced
international partners to develop, finance, construct and operate the Project.

PROJECT IN BRIEF

The Government of Mongolia resolved to build power plant at Tavantolgoi coal deposit.

Capacity:

450W coal-fired power plant.

40 L/sec water supply system

Coal resource:

Tavantolgoi coal mine

Off-taker:

Main off-taker: Oyu Tolgoi LLC

Other off-takers: Power consumers in the region (up to 150MW)

FOREIGN INVESTOR SELECTION PROCESS

FOREIGN INVESTOR SELECTION PROCESS

Conducted extensive survey on globally well-know IPP companies
Developed a long-list of IPP companies based on their technical and financial
capabilities and delivered Invitation to express interest (25 companies)
Received Expressions of Interest (10 companies)
Conducted Pre-qualification and developed a short-list
(4 consortiums)
Marubeni
Corporation
(Largest IPP
companies from
Japan)

Kansai Electric
Power
(Second largest utility
company from Japan)

GDF Suez &

POSCO Energy
(GDF is worlds largest IPP
company)

Daewoo E&C
(Korean large group
company)

TTPP project attracted world-class IPP investors.

It can bring Mongolia into the attention of global power market.
IPP (Independent Power Producer) is defined as a company which invests,
builds and operates the power plant.

GDF SUEZ
GDF SUEZ S.A. (GDF SUEZ) is a French multinational
electric utility company which operates in electricity
generation and distribution, natural gas and renewable
energy.
The company was formed on 22 July 2008 by the merger of
Gaz de France and Suez.
Key shareholders: French Government with 33.29%, Group
Bruxelles lambert SA with 2.38% and GDF Suez with 2.18%.
Listed on the Paris and Brussels stock exchanges GDF SUEZ
has a market cap: USD 49,508.7 million (as of 6th April 2015)
GDF SUEZ globally, employs 152,900 people and is rated A1
by MOODYS and A by S&P.

Key Coal Fired Operating Plants

Summary Financials

Project

Capacity
(MW)

Role

Financials

As of 31 Dec 2013

Glow Energy CF83,

Thailand

115

Developer/Owner/Oper
ator

Total Revenue

USD 81,902.9 mn

Operating Income

USD 7,272.85 mn

Gheco One,
Thailand

660

Owner/Operator

Assets

USD 181,278 mn

Willemshaven ,
Germany

800

Developer/Owner/Oper
ator

Liabilities

USD 119,911 mn

Paiton III, Indonesia

815

Developer/Owner/Oper
ator

Equity

USD 61,367.4 mn

Gheco
One,
9
Thailand

660

Developer/Owner/Oper
ator

POSCO ENERGY
POSCO ENERGY (POSCO), founded in 1969 as Kyung-In
Energy Company is engaged in Power generation,
Renewable energy, Fuel cell and Resource development.
POSCO is Koreas first and largest independent power
producer
Supplies ~ 16.5% of total power around Seoul metropolitan
area.
Major shareholders: POSCO with 89.02% and Korea Finance
Corporation with 8.62%.
Parent - POSCO Group, the 4th largest steel marker in the
world.
Rated AA+ by Korea Ratings Company Limited and by NICE
(both local Korean credit rating agencies)

Key Operating Plants

Ulanbaataar,
Mongolia
Coal Fired Cogeneration Power
Plant (450 MW)

Jakarta, Indonesia
Fuel Cell Power
Generation Plant
(300kW)

Quang Ninh,
Vietnam
Coal Fired Thermal
Power Plant (1,200
MW)

Cilegon,
Indonesia
Gas Power Plant
(200 MW)

Summary Financials
Financials

As of 31 Dec 2013

Total Revenue

USD 2,679.34 mn

Operating Income

USD 209.265 mn

Developer/Owner/Oper
ator

Assets

USD 3,863.45 mn

Liabilities

USD 2,419.01 mn

300

Developer/Owner/Oper
ator

Equity

USD 1,444.53 mn

1,200

Developer/Owner/Oper
ator

Project

Capacity
(MW)

Role

Incheon Combined
Cycle Power Plant 14, Korea

1,800

Developer/Owner/Oper
ator

Incheon Combined
Cycle Power Plant 56, Korea

1,200

Gwangyang,
Combined Cycle
Power Plant, Korea
10 Duong II, Coal
Mong
Power Plant,

Overseas Ongoing Power Plants

MARUBENI
Marubeni was incorporated in 1949 and is involved in power
and infrastructure, plants and industrial machinery, logistics,
real estate development and construction.
Market cap: USD 10,070 million (as of 6th April 2015) and
listed on the Tokyo and Nagoya Stock Exchange.
Marubeni Corporation is rated Baa2 by MOODYS and BBB by
S&P.
Invested/operated 48 overseas power generation projects in
22 countries with gross capacity of over ~32GW.
Total global capacity of 10,000MW based on equity share.
Employees over 4000 people world wide with presence in 64
countries

Summary Financials

Key Operating Plants

Project

Capacity
(MW)

Role

San Roque, Hydro,

Philippines

345

Owner/O&M/Developer

Sual, Coal Fired

Power Plant,
Philippines

1,218

Owner/O&M

Pagbilao, Coal Fired

Power Plant,
Philippines

735

Owner/O&M

Senoko Power,
11
Gas/Oil,
Singapore

3,300

Owner/O&M

Financials

As of 31 Dec 2014

Total Revenue

USD 65,853.7 mn

Operating Income

USD 1,522.67 mn

Assets

USD 67,143.7 mn

Liabilities

USD 52,730 mn

Equity

USD 14,414.6 mn

KANSAI ELECTRIC POWER COMPANY

Kansai Electric Power Company (KEPC) is a vertically
integrated power utility and the second largest in Japan,
covering Kansai area including big cities such as Osaka,
Kobe and Kyoto.

Overseas Power Plants by Kansai

KEPC area of business includes hydroelectric, thermal,

geothermal and nuclear power.
Total generating capacity of ~ 35GW, transmission lines of
~19,000km and distribution lines of ~130,000km.
Listed on the Tokyo Stock Exchange with a market cap of
USD 8,915.48 mn
Rated A3 by MOODYs
Key shareholders are the City of Osaka with 8.92% and
KEPC with 4.79%

Key Operating Plants

Project

Capacity
(MW)

Role

Rojana SPP,
Combined Cycle,
Thailand

448

Owner

Kuo Kuang,
Combined Cycle,
Taiwan

480

Senoko Power, Oil,

Singapore

3,300

Owner

Bluewaters, Coal
12 Power Plant,
Fired
Australia

459

Owner

Owner

Summary Financials
Financials

As of 31 Dec 2013

Total Revenue

USD 28,549.4 mn

Operating Income

USD -1,097.7 mn

Assets

USD 64,019.4 mn

Liabilities

USD 54,403 mn

Equity

USD 9,616.43 mn

DAEWOO ENGINEERING & CONSTRUCTION

Daewoo Engineering & Construction is primarily a general
engineering and company. Projects include Commercial
buildings, schools, hospitals, ports, tunnels, railways, dams,
power plants and residential buildings.

EPC Experience in Power Plants as per

Fuel (in MW)

Experienced in power sector as one of key players within

Korea and abroad ranging from gas- and coal-fired to nuclear
more than 29,000 MW (as of June 2013).

3405
1531

14238

6569

Market cap: USD 3,108.95 million and it is listed on the

Korean Stock Exchange.
Employees over 6,247 people globally and has a Credit
Rating of

Gas

Coal

Oil

Nuclear

Hydro

Tidal

Summary Financials

Key IPP Experience

Project

Capacity
(MW)

Role

Pocheon Combined
Cycle Power Plant,
Korea

940

Developer

Houay Ho
Hydropower, Laos

150

Developer

Patrind Hydropower,
Pakistan

150

Deverloper

13

980254

Financials

As of 31 Dec 2014

Total Revenue

USD 9,230.36 mn

Operating Income

USD 394.333 mn

Assets

USD 9,475.27 mn

Liabilities

USD 6,958.18 mn

Equity

USD 2,517.09 mn

PROJECT KEY STUDIES

Feasibility Study
Feasibility study for 450MW Coal-fired Power Plant was conducted from June to September, 2013
Feasibility study was approved by Ministry of Energy in September, 2013.

DEIA
DEIA for TTPP and distribution line was completed in September, 2013
DEIA was approved by Ministry of Green Development in October, 2013

Geotechnical Survey
Geotechnical survey for the plant site was conducted from July to September, 2013

FS for Distribution Line

Feasibility study for Distribution Line was conducted in September - November, 2013

Land Assessment
Land characteristics and quality assessment for Power Plant and Distribution Line was conducted in September - November 2013.

ESIA
ESIA for the plant is being conducted by Mott Macdonald and is on-going.

Bankable Feasibility Study

Conducted by Worley Parsons to be finalized by the selected bidder

PROJECT SITE AND LAND

Project Site
Project located in the Tavan Tolgoi
area in the South Gobi region of
Mongolia
Approximately 480 km south of
Ulaanbaatar and approximately 135
km north-west of OT
Strategic nature of the Project Site
Area where GoM prioritizes power
capacity
Close to coal mines ETT and ER
Proximity to water resources of ER
Availability of ash landfill area
Connectivity with Ulaanbaatar and
OT (flights and paved roads)
Existing power plant
Mining region

15

Permits, Licenses and Project Studies

Permits

Project Studies

The Project Company has obtained the

following special permits from Energy
Regulatory Commission of Mongolia:

A list of Project studies undertaken have been

provided in the RFP

Construct 450 W power plant

Construct 220 kV electricity Distribution
Line

Next Steps
The Winning Bidder shall:

Electricity generation and distribution

Update the existing Feasibility Study of

TTPP and resubmit it to the MoE for
approval

Unregulated and regulated electricity

supply

Update the DEIA and resubmit it to the

MEGD for approval

Heat generation, distribution and regulated

supply

Complete an ESIA based on the ESIA

Baseline Study conducted by Mott
MacDonald

Import and export of electricity

Next Steps
All other necessary permits & licenses shall be
obtained by Project Company, EPC contractor
and O&M contractor in accordance with
relevant laws and regulations

16

PROJECT TIMELINE

PROJECT TIMELINE

2013.03.19

2013.07.18

2013.08.18

2013.10.02

2014.10.17

Project Unit
was set up

Invitations for EoI

(25 companies)

Expressed Interests
(10 companies)

Technical RfP

Commercial RfP

Pre-qualification
(4 bidders)
2013.08.30

Marubeni
Corporation

Kansai Electric
Power

GDF Suez and

POSCO Energy

Daewoo E&C

TECHNICAL AND COMMERCIAL RfP

From August 2013 to 2014, TTPP Project Unit completed and issued Technical and
Commercial RfP to the bidders. The RfP consists of all the technical minimum
specifications, completed surveys and studies, and commercial arrangements
including PPA, CSA, WSA, IA, SHA etc. Now the bidders are working on their proposals.

18

FURTHER STEPS

201
5

Proposals
Preferred bidder
Execution of project
documents
Winning bidder

201
6

Financial close
Earth works
Construction works

201
9

Commissioning

PROJECT SIGNIFICANCE
Credit-worthy off-taker
Abundant thermal coal reserve
Secured water resource
All required special permits and licenses obtained
Designated project team
International professional advisors (financial, technical and legal)
Highly supported by the Government of Mongolia

THANK YOU