Mining Firms Commit to Responsible Water Use in Mongolia


In the Mongolian desert, minerals are plentiful but the water required to mine them is scarce. This has contributed to growing tensions between local communities and mining companies operating in the south Gobi region.

To confront this challenge, IFC has been working with the mining sector and local communities to identify ways to improve water management practices at the catchment level. This work culminated in the signing of a landmark Code of Practice by eight mining companies in February. The initiative was supported by the Government of Canada, the 2030 Water Resources Group, the European Bank for Reconstruction and Development, and the International Council on Mining and Metals.

The Code of Practice requires mining companies to publicly report water risks and management practices, support training and awareness-raising on groundwater protection, and involve impacted communities in monitoring a mining company’s water performance.

"Water is critical to mining operations but it cannot be taken for granted, especially in an arid region like the South Gobi. The companies we have been working with recognize the need to approach this as a sector,” said Arjun Bhalla, senior operations officer with IFC’s Infrastructure and Natural Resources Advisory team. “The Code of Practice provides a framework for creating a positive impact on water management by conserving ecosystems, strengthening communities, and committing to specific operational practices."

IFC is an investor in Oyu Tolgoi, a $22 billion copper and gold mine in the South Gobi, which is preparing for an underground expansion. The company’s development follows a plan that ensures efficient use of water resources. It recycles approximately 85 percent of the water used.

Oyu Tolgoi LLC—a joint venture of Turquoise Hill Resources (majority-owned by British-Australian mining group Rio Tinto) and the Mongolian company Erdenes Tavan Tolgoi—was among the signatories of the Code of Practice. The other companies included Erdenes Mongol, Energy Resources, Erdene Resource Development, South Gobi Sands, Terra Energy, and Gobi Coal and Energy.

The group released a statement upon their signing committing themselves to follow through on the best practices. “The Voluntary Code of Practice is a powerful display of corporate accountability. It is necessary to balance mining sector development with the human need for water in the Gobi region. We have made a statement of intent; now we have to deliver on it.”

Published in February 2016