Mining Infrastructure Investment Support (MINIS) Project

The World Bank is funding feasibility studies under the MINIS project that could lead to large dams on the Selenge and Orkhon Rivers in Mongolia. These dams will negatively impact agricultural productivity for the communities living in the affected river basins as well as affect water levels in Russia’s Lake Baikal, a UNESCO World Heritage Site.

The World Bank approved the initial $25 million credit to the Mongolian government for the Mining Infrastructure Investment Support (MINIS) Project on May 10, 2011. The purpose of the project is to provide technical assistance to the Government of Mongolia to facilitate investments in the infrastructure needed to support mining (such as roads or power sources) and build the capacity of the government to prepare and seek financing for similar projects in the future. The project does not fund any physical activities or works, only feasibility studies and other preparatory assessments. However, because of the potential risks that may be incurred by the implementation of any of the proposed subprojects, the project has been classified as Category A and six of the ten environmental and social safeguard policies has been triggered.

Original image by Eugene Simonov, Rivers without Boundaries Coalition

The MINIS project is comprised of four major components. An additional $4.2 million grant from the Australian Agency for International Development for Component 3 was approved by the Bank on March 24, 2014.

Component 1: Support for Infrastructure Investments. 
This component includes financing to prepare regional infrastructure investment plans, address emerging priority issues, and conduct feasibility studies for a select number of subprojects. The six subprojects selected under this component are (i) Flow regulation of the Orkhon River and construction of water reservoir complex (Orkhon-Gobi River Diversion), (ii) Shuren Hydropower Plant (HPP), (iii) 3) Integrated Steel Complex with infrastructure in the central region of Darkhan-Selenge, (iv) Extension of Coal Mine “Baganuur” LLC, (v) Rural and Industrial Water Supply Scheme in the South Gobi region, and (vi) Synthetic Natural Gas Plant (SNG).

Component 2: Capacity Building and Knowledge Transfer
This component includes training and advocacy programs (both formal and on-the-job) from qualified consultants on project preparation, especially for Public-Private Partnerships. The component also covers fees for consultants and training on contract administration.

Component 3: Strengthening Groundwater Management
This component covers the establishment of regional Groundwater Management Councils and Groundwater Management Administrations in Southern Mongolia. This component will also include a review of water resource pricing.

Component 4: Project Management
This component finances the hiring of the Project Management Unit (PMU) Director and consultants as well as funds to procure the necessary supplies and equipment to effectively operate the PMU.