Central Bank of Mongolia and Commercial Banks collaborate to build of petroleum reserves

The Ministry of Industry and Mineral Resources hosted a meeting with representatives of the Bank of Mongolia and commercial banks to discuss the mechanisms for providing low interest financing to petroleum importers for construction of storage facilities.

The meeting held due to the  Parliament approval of Law on Supporting the Supply and Provision of Strategic Products, regulates the concessional financing to build the petroleum storage facilities capable of reserving 30 days of the country’s  petroleum consumption.

Vice Minister Enkhtuvshin Begzsuren, highlighted that concessional loans will be allocated to only qualified companies through Central Bank’s repo financing and special purpose funding from commercial banks.

Officials from Central Bank, and commercial banks’ representatives expressed their partnership for providing low cost loans, and repo financing.

Vice Minister of Industry and Mineral Resources Enkhtuvshin stated “The Ministry’s priority is to build petroleum storage facilities in near future without disrupting private sector including banks but to ensure balancing every stakeholders’ interest.

He also added that “Petroleum demand usually soars during the spring planting and autumn harvesting, in addition to recent years of significant consumption spike. Meanwhile, no sign of international geopolitical conflicts has shown. In order to secure country’s energy security, petroleum storage facilities needs to be constructed within certain period.”