Noble Group, the Hong Kong-based commodities trading powerhouse, has snapped up a 10 per cent stake in the ASX-listed Xanadu Mines.
The two companies will jointly explore mining opportunities in Mongolia.
The landlocked, resource-rich nation between Russia and China 'is an Aladdin's cave for exploration', said Brian Thornton, the chairman of Xanadu, a Mongolia-focused exploration company that listed on the Australian Stock Exchange in December. 'We have identified a couple of opportunities that we intend to pursue aggressively.'
While Mongolia, which has only three million people and which managed economic output of just US$4.2 billion in 2009 - 2010 figures are not available - the country is a treasure trove of mining opportunities. According to broker Renaissance Capital, the nation is sitting on the world's 11th-biggest coal reserves and the planet's second-largest copper reserves, after Chile's.
Thornton said Xanadu and Noble were looking at iron ore and coking coal projects. 'I would estimate that 70 per cent to 80 per cent of Mongolia remains unexplored by miners,' he said.
Because there is a large amount of coal at the earth's surface in Mongolia, Thornton said, most private licence holders in the country were focusing on obviously visible deposits.
'It does not take much to find a 500 million tonne coal deposit in Mongolia,' he said. 'But then again, a lot of the country has not been touched.
