Improving the
livelihoods of
neighbouring
communities

Local and regional development

 

Oyu Tolgoi community relations
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Local and regional planning and development

We are implementing a range of community development programmes to improve the livelihoods of the people and areas neighbouring the Oyu Tolgoi site. These aim to stimulate economic development, build local skills, create jobs and improve infrastructure such as roads, schools and hospitals, whilst identifying, avoiding or minimising any potential negative development impacts on local communities.

Our programmes are internally and externally monitored to ensure they continue to respond to changing requirements.

Local Business and Economic Development programme

This community programme aims to stimulate local economic development by supporting the establishment of new enterprises and the expansion of the existing business operators in Khanbogd, Manlai, Bayan Ovoo and Dalanzadgad soums. The programme is geared towards promoting economic diversification and sustainable livelihoods, thus supporting the economic wellbeing of the local communities well beyond the life of our mining operations.

The objectives of this programme are to:

  • strengthen non-herding businesses by improving skills, product development, marketing and access to finance and technology
  • assist herding businesses to commercialise their businesses through livestock management, animal breeding, veterinary service delivery, prevention of natural risks, camel milk and wool processing, felt making and other income generation activities
  • assist income generating businesses or projects led by women or venerable groups
  • implement economic development projects for resettled or impacted households
  • promote green business development initiatives (eg renewable energy, waste recycling)

To deliver this programme we are working closely with business consulting Development Solutions NGO and commercial banks, Khan and XAC Banks.

In the first half of 2011 this programme has taken 53 local businesses through a package of business training, developing their business plans, and applying for the bank loans needed to grow their businesses. Development Solutions NGO provides consulting services to these selected businesses such as vocational skills trainings, facilitation of loans with their partner banks, creating business linkages between businesses and large domestic and foreign organisations, forming groups and cooperatives and by consulting for and working with other organisations that share a commitment to its mission.

These initiatives cover a wide variety of business types including: dairy and felt production, vegetable growers, camel milk processing, bakery, photo shop, café and motorcycle repair shop.

Members of the community can contact our Branch offices for more information.

Local and Regional Planning and Infrastructure programme

The South Gobi province, known locally as Umnogovi aimag, is set to experience an economic boom as a result of the mining development at Oyu Tolgoi and a number of other locations throughout the region such as Tavan Tolgoi. It is projected that the urban populations in the South Gobi will more than double over the next ten years.

Our Local and Regional Planning and Infrastructure programme is designing and implementing a range of investments in local and regional planning, infrastructure and service development to ensure that the effect of our operations on the region is positive and long lasting. We are continually monitoring our direct and indirect economic impact on the community, engaging with local stakeholders and evaluating the outcomes of our investments.

Our strategic objectives for this programme are to:

  • provide quality of life benefits to the existing and incoming population
  • contribute to good local governance, planning and management
  • contribute to the equitable economic growth of the region
  • help build attractive and sustainable communities – communities that people want to live, work and invest in

Our approach

We are collaborating with local and regional authorities and community groups to implement this programme with a two-phased approach that achieves tactical quick-wins, whilst implementing an investment framework to support long term development.

Step one: Tactical

In collaboration with Local Advisory Groups, we have identified a programme of infrastructure projects that address immediate needs and are not subject to long, drawn out planning processes. These projects enjoy strong political and community support and deliver practical infrastructure improvements or developments that provide high impact benefits to the community.

Examples of these projects include the provision of a bulk water supply for the local regional centre of Khanbogd and the construction of a sports hall at Bayan Ovoo.

Step two: Strategic plan and programme

To develop a strategic plan and programme for longer-term planning and infrastructure development we have adopted a participatory and evaluative approach. Extensive planning and visioning sessions have been carried out in each of our surrounding districts, forming a strong and mutually developed foundation for our longer-term planning. These plans and programmes will span approximately seven years and link the communities’ infrastructure needs to our mine’s development plan. 

It is critical to our approach that the strategic development plan and programme are ahead of our mine development plan to avoid any risks to the timely supply of services. For instance it is essential for us to establish employee housing close to the neighbouring town of Khanbogd in order to accommodate our site’s employees. We are also planning to develop an industrial zone close to the mine to accommodate our suppliers and offer further employment opportunities.

Community Health, Safety and Security programme

The goal of this programme is to improve community health, safety and security for Oyu Tolgoi’s local communities, which are set to experience strong population growth over the next ten years. In 2010, we commenced a comprehensive Health Impact Assessment, which is the foundation of our Community Health, Safety and Security programme.

The assessment and programme were designed by a consortium of health experts, Khukh Tenger Khugjil Konsortium, their six partner organisations and 30 other special interest groups from across government, academia, the private sector and the community.

Our Community Health Safety and Security programme aims to:

  • minimise and mitigate any negative health, safety and security impacts that are directly and indirectly stimulated by our operations
  • measurably improve health, safety and security service delivery, capacity and indicators in our local communities
  • complement and build upon existing internal health, safety and security policies, standards, knowledge and best practice in relation to employees and contractors, and extend these standards to local community stakeholders where appropriate and feasible 

About the Health Impact Assessment

Our comprehensive Health Impact Assessment examined the health impact of our operations on the surrounding areas of Khanbogd, Manlai, Bayan Ovoo and Dalanzadgad soums. The methodology was based on international best practices, including those from the International Council on Mining and Metals, but tailored to the Mongolian context and is the first of its kind conducted in Mongolia. Approvals were received from the Public Health Institute’s Scientific Committee and the Mongolian Ministry of Health’s Ethical Committee. 

This Health Impact Assessment forms a strong foundation of knowledge and aims to ensure that the potential health effects of any of our policies, programmes and projects are understood and taken into consideration throughout the planning process.

Stakeholder Engagement

Throughout the assessment process we engaged stakeholders from all levels of local, regional and national government, a wide variety of health experts and aimed to balance all these views with the needs identified by local community stakeholders.

Our experts included the Public Health Institute of Mongolia; the Foundation for Health Policy Promotion; international health services organisation JTA International; EPOS Health Management; the PACT Institute; and the Mongolian Centre of Development Studies. The process was highly participatory in nature with members of the community being involved in focus groups, key stakeholder interviews and public meetings in order to assess the health impacts and associated mitigation options.

A Stakeholder Advisory Committee was established to steer our stakeholder engagement and consultation activities. The committee is formed of businessmen, local officials, hospital leaders and civil society representatives, and was approved by the governor of each of the four soums (districts).

Throughout the design of the Community Health, Safety and Security programme this committee was instrumental in identifying the most significant priorities and suggesting potential solutions. 

Health Impact Assessment outcomes

Based on the identified health impacts and their assessed severity, the Community Health, Safety and Security programme was developed to protect and promote the health and wellbeing of our surrounding communities. The framework of the programme was reviewed against the Ministry of Health’s own Health Sector Master Plan and other existing programmes to identify any existing or potential synergistic programmes for alignment in our current or future plans.

Community Agreement

We are committed to achieving world-class standards in relation to our community engagement and the benefits realised in the region from our operations. To support this we have initiated a legally enforceable Community Agreement that establishes the terms of our long term relationship and the future regional development with the local community.

Together with the South Gobi Regional Development Council and local community stakeholders, the Community Agreement aims to deliver tangible benefits to local and regional development in the long term by maximising the regional economic benefits.

An important part in earning our license to operate, the Community Agreement enables us to comply with the Minerals Law requirement to enter into a cooperation agreement with the local community, elements of our Investment Agreement, and other regulatory requirements for community consultation.

The Community Agreement comprises of a range of binding management plans, designed through participation and agreement of all parties. Each management plan outlines the joint development principles and implementation plan, objectives, mutual obligations and mechanisms for achieving successful outcomes. The agreement also covers corporate ethics and governance, conflict resolution and review mechanisms.

Southern Gobi Regional Development Council

Oyu Tolgoi has partnered with the Government to create and operate the Southern Gobi Regional Development Council. The Council provides a broad stakeholder group to guide and facilitate the development of the Southern Gobi region.

Formed in accordance with the provisions of our Investment Agreement the Council’s vision is:

“To make the Southern Gobi region a model of sustainable development and the economic driver of the region and the nation.”

The Council aims to maximise the value of large investments made in the South Gobi region through the effective coordination and partnership with participating council members and communities in the region.

The Council objectives are to:

  • guide the government in developing a medium to long term strategy for the socio-economic development of the South Gobi region
  • review and guide investment prioritisation, development plans and government budgets in the region, providing feedback to relevant government departments and private sector investors
  • coordinate and advise on the planning, preparation, financial structuring, management, and implementation of public and private sector investments in the region and support the creation of development partnerships
  • initiate sub-groups to tackle issues of special concern, eg water, power, population, housing and urban development, border crossings; PPP unit; South Gobi forum; vocational training; risk management
  • provide support to comprehensive local and regional planning and development, resolve planning conflicts and encourage and support transparent and responsible local governance