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World's Largest Gold/Copper/Moly Mine

Written By Christian DeHaemer

Posted July 25, 2011

Last week, I left you spinning on a horse on the Mongolian steppes…

Then my right stirrup simply fell off. The reigns were in my left hand, my right hand was on the bit of metal they call a pommel, and as the stirrup gave way, I lurched heavily to the starboard side. Pulling hard with my left hand to stay on the horse dug the bit painfully into the soft part of the brute’s mouth.

He started spinning like some sort of Planet of the Apes-themed teacup-nightmare amusement ride. The first time the horse came around, the saddle started to inch over. I thought he was going to roll on me…

By the second spin, I realized my faithful Mongolian guides weren’t going to ride up at the last minute and save me.

On the third rotation, time had nearly stopped. Adrenaline was coursing through my veins, and as I desperately fought for balance, hooves hit the rocks like an axe…

Somewhere in there, I knew I must get off the horse. Swinging my leg over, I pushed off…

And that’s it. I landed.

When I looked up and realized I hadn’t died, I saw the horse speeding across the valley, being chased down by a tall Mongolian boy. I picked up the stirrup and began to walk back to the hotel as if I was the coolest guy in the world.

Why I Go to Mongolia

I tell you of my adventures, but the real reason I travel to Mongolia is because it is going to make people very wealthy.

There is a legitimate resource boom going on in the country. Rio Tinto, China’s Shenhua Group, and other big-time syndicates are competing over the rights to extract coal, copper, gold, molybdenum, and uranium.

A flood of money is pouring into the city. Already all the best hotels are booked, and I counted more than 50 cranes building more. There have been big changes since I first went to Ulaanbaatar almost two years ago.

But don’t take my word for it…

Here is what Bloomberg News recently wrote of Mongolia:

It’s a resource play that’s expected to bring a flood of money into the impoverished country over the next decade, centered around huge mining projects such as the Shivee Ovoo and Tavan Tolgoi coal reserves, valued at about $300 billion and $400 billion, respectively, and the copper and gold mine Oyu Tolgoi, worth some $300 billion, according to Quam Asset Management Ltd. in Hong Kong, which runs a Mongolia-focused investment.

While it may be short on humans, Mongolia is one of the richest nations in terms of natural resources, and that’s just the known deposits. Four-fifths of the country is still unsurveyed. Over the next decade, copper production is expected to double, iron ore to triple, coal to grow by six times, and gold and oil by 10 and 13 times, respectively.

Much of that growth will be driven by demand from China, predicts Eurasia Capital, an Ulaanbaatar-based investment bank that focuses on Central Asia and Mongolia.

The biggest prize is Oyu Tolgoi — or Turquoise Hill — named after the color of copper oxide as it seeps from the ground, and one of the largest deposits of copper and gold.

Situated deep in the Gobi Desert, it’s just 80 kilometers (50 miles) from China’s northern border. Canadian company Ivanhoe Mines Ltd. and Rio signed an agreement with Mongolia to develop it in 2009 after the project developer Ivanhoe tried for more than six years to reach a mining accord. Rio last month agreed to increase its stake in Ivanhoe to 46.5 percent.

Mongolia will grow in the double digits for the next ten years. Per capita income is expected to grow four-fold.

It was the best-performing market in the world in dollar terms in 2010; it will likely be the best market over the next six months as well.

That’s why I take 30-hour flights and almost get stomped on by horses — all so you can take advantage of tremendous ground-floor opportunities.

Don’t be fooled by Mongolian funds that buy Rio Tinto or Ivanhoe and pretend they are a pure play on Mongolia…

Vast sums of money will be made in real estate, local coal mines, gold producers, and oil companies.

One of my contacts is the largest broker on the Mongolian Stock Exchange, an exchange now managed by the London Stock Exchange. You can now buy where major mutual funds cannot. In small companies, that will see a massive influx in cash as every Mongolian suddenly has tögrög to spend…

I recommend you pay close attention to the Mongolia growth story as it continues to unfold.

In other happenings, we at Angel have been bringing you a constant stream of new videos to help you better understand — and profit from — the ideas we convey to you on a daily basis.

This week, my friend Ian Cooper is out with a new Whiteboard Weekly on which drug companies you should be watching in the near future.


Christian DeHaemer
Editor, Wealth Daily