Government of Mongolia(GOM) stated on 06/29/2011 that
o   Head of Government TT taskforce has briefed Cabinet meeting that negotiations with 6 shortlisted TT strategic investors have been done 18 times and 3 have been shortlisted
o   GOM aims for TT to become world class reputable mine with high level of mining and labor safety, international standards of environmental protection and rehabilitation, sales and marketing of coal at high prices and delivery to final consumers
o   Negotiations with participant parties are continuing in not easy condition
o   Cabinet meeting has decided to introduce TT current progress to Parliament
On 06/17/2011 GOM stated
· Policy is adhered to introduce interests of neighbor countries in a sense that TT has significance of to be resolved together with issue of markets and transit transportation
·In general,  PRC is the main market for OT and TT therefore Mongolia will support participation of PRC enterprises, in this sense active participation of PRC-supported Shenhua in international consortium to implement TT project has been discussed
Government Reserve Fund is to provide 1.54B MNT(1.22M USD) to determine amount of environmental damage, cost of mine closure and rehabilitation of gold placer mines in protected river basins and forest reserves area, as approved by Environmental Impact Assessment Commission
· It’s for each of all 245 license covered areas with gold placer mines in 12 provinces
Chairman of Petroleum Authority has briefed
· Previously only Rosneft was a supplier, now nine sources are to supply, agreements are being established as we speak
·Meeting of Mongolian-Russian intergovernment meeting will start today
·Negotiations are in progress with Korean suppliers and fuel transit transportation is being discussed
·There are reserves of 14 days for regular gasoline, we are arranging to satisfy even panic stocking up, orders are enough for 3 months of consumption
·Mongolia’s monthly consumption of regular gasoline is 20 thousand tons, yet we ordered to Rosneft for this month 30 thousand tons, those will come soon and 25 thousand to other suppliers


·has exported a trial shipment of 650 tonnes of thermal coal(ten wagons) from Ulaan Ovoo mine.
· The coal was loaded on to rail at Sukhbaatar rail station and crossed the border into the Republic of Buryatia in Russia via Naushki and sold to Russian company Energy LLC and then consumed in local Buryat power stations and boilers.
·Representative of Buryat Government to Mongolia commented- ” historic, first ever shipment of Mongolian coal to Buryatia, Russia, Ulaan Ovoo coal will become a significant source to feed the energy sector of this region".
· valuable trade for Prophecy as it helps the Company determine local sales logistics, wagon loading times, export requirements and customs procedures to ensure smooth operations for future coal export of larger quantities.
·Prophecy is collaborating with a number of government and private entities towards opening of the Zeltura border post, which is 15 km from the Ulaan Ovoo mine. The opening of Zeltura would enable Prophecy to sell Ulaan Ovoo coal at mine gate to Russian industrial consumers and translate into significant transportation savings for Prophecy. The company actively pursuing securing transparent long term contracts to Russia and export via Russian port, researching conveyor belt
· preparing and ordering wagons for the next shipment in July 2011, destined for the port of Sovetskaya Gavani, of which the company has secured annual capacity of 300,000+ tonnes.
· Prophecy"s Ulaan Ovoo has produced over 200,000 tonnes of coal of domestic and export quality since commencing mining. The export quality coal registers (as-received basis) NCV 5,200 kcal/kg with 5% ash and 0.5% sulphur.
· Mongolian mining expert Dr.Hancock commented to Frontier Securities that “ although 650 tonnes is small it is clear that this shipment is very important in order for the company to establish export protocols and procedures to facilitate lager shipments in future”
· PCY up 3.45% to 0.60 compared to S&P TSX-V up 1.43% on a volume of 357K, 12% more than average, investors seem to be encouraged
Frontier Securities conclusion:

We believe that this successful trial shipment is important due to
· does answer the logistics and customs questions
·important in terms of context of Prophecy’s stockpile already at the border, secured Russian seaboard port access allocation and active negotiations by the company of the Russian Railway rates.
·in line with Mongolian exports market diversification official policy