Natural Environment Must Be Considered During Oil Extraction
A discussion regarding the building of oil refineries in Mongolia and the proposal for renovation of oil exploration and exploitation laws was held yesterday in the Civil Chamber.
Due to Mongolia’s 100 percent dependence on Russia for oil products, any change in the price of petroleum in Russia greatly affects the economy of Mongolia, as we have witnessed in the past few months. Although Mongolia has significant petroleum resources, it lacks oil refineries, leaving Mongolia no choice but to export crude oil.
The foundations of two oil refineries are set in Dornogovi and Darkhan-Uul aimags although not without some problems. Domestic construction companies criticized the government for demanding the difficult task of building new oil refineries with a crude oil processing capacity of at least 1 million tons a day.
The participants in the discussion were also proposing changes and additions to the oil exploration and exploitation laws, emphasizing the archeological and ecological importance of some oil extraction fields. During the 2007 inspection on oil extraction companies, it was revealed that Buir Lake’s northern part is significantly polluted due to oil extraction activity.
The participants in the discussion pointed out that in any oil extraction project, a detailed archeological and ecological research and evaluation must be performed and that opinions and viewpoints of archeologists and ecologists should be reflected in the renovation of oil exploitation laws. In response, representatives of The Petroleum Authority of Mongolia said that the 3 percent of the investment for prospecting and 1 percent of the exploitation income is accumulated in a separate fund dedicated to the environmental restoration.
Due to Mongolia’s 100 percent dependence on Russia for oil products, any change in the price of petroleum in Russia greatly affects the economy of Mongolia, as we have witnessed in the past few months. Although Mongolia has significant petroleum resources, it lacks oil refineries, leaving Mongolia no choice but to export crude oil.
The foundations of two oil refineries are set in Dornogovi and Darkhan-Uul aimags although not without some problems. Domestic construction companies criticized the government for demanding the difficult task of building new oil refineries with a crude oil processing capacity of at least 1 million tons a day.
The participants in the discussion were also proposing changes and additions to the oil exploration and exploitation laws, emphasizing the archeological and ecological importance of some oil extraction fields. During the 2007 inspection on oil extraction companies, it was revealed that Buir Lake’s northern part is significantly polluted due to oil extraction activity.
The participants in the discussion pointed out that in any oil extraction project, a detailed archeological and ecological research and evaluation must be performed and that opinions and viewpoints of archeologists and ecologists should be reflected in the renovation of oil exploitation laws. In response, representatives of The Petroleum Authority of Mongolia said that the 3 percent of the investment for prospecting and 1 percent of the exploitation income is accumulated in a separate fund dedicated to the environmental restoration.
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