Mongolia’s First Oil Refinery
Mongolia is a large, landlocked country sandwiched between Russia to the north, China to the south. Since the 1990s Mongolia has a free market economy and open to all foreign business and trade. It is rich in natural resources and livestock. The mining sector has been flourishing and oil exploration and extraction has been going on since 2000.
Although Mongolia is self-sufficient in oil and has its own oil fields, almost all of its crude oil is exported unprocessed, mainly to China, while most of its finished petroleum products are imported from Russia. In recent years domestic petroleum demand has been growing due to increased activity in the mining industry as well as the surge in usage of domestic vehicles throughout the country. In the last five years 25-30% of Mongolia’s total imports have been petroleum products.
The lack of domestic processing facilities, combined with export and import dependency on both neighbours, creates ongoing imbalance and vulnerability in Mongolia’s economic development and...