Collaboration with local and regional government is key to our Community Relations approach. This approach has three tracks:

  1. Resettlement.
  2. High impact quick support that immediately benefits the local people.
  3. A longer term investment based framework to support robust and sustainable development (Built around a Community C-operation Agreement (CDA)).

Key to the success of any project in Mongolia is the development of a relationship with all stakeholders. In Mongolia this includes local (Soum), regional (Aimag) and State level institutions. In developing nations such as Mongolia there can be a tendency for mining companies to assume the roles normally expected of a state. Terra Energy is careful not to artificially inflate local budgets and inflation by constant communication and aligning the development of the mine with that of the Soum. Our staff are constantly engaged with people at all levels and very aware of the importance of good communication. The South Gobi is a fragile environment in more ways than one and we take our Environmental and Social obligations very seriously. Balancing what we can do against people’s expectations can be difficult and while we can never please everyone we focus on assisting the people to realize their ambitions and goals with our assistance, not with us in the driving seat.

Consultation at the local level is a key part of Terra Energy’s approach

Consultation at the local level is a key part of Terra Energy’s approach

We are impacting way of life that is 1000s of years old. It was here before us and will endure after we have departed. Our 3 step approach is in line with what other Mining Companies have developed in Mongolia and will hopefully soon be formalized into national guidance and a standard for Environmental and Social engagement:

Step One: Resettlement

The resettlement process began over a year ago and has been a challenge for all concerned. Terra Energy would like to first thank all those affected/impacted for their patience and understanding. To date we have resettled a number of families directly and indirectly affected by our activities. To provide an idea of the scale of the issue the map below shows the span of activity currently undertaken by Terra Energy and a large number of sub-contractors.


Fig 1: Extent of Activity

Check here for Terra Energy’s Resettlement Action Plan and Displacement Policy.

Step Two: On the Ground!

A Community Consultative Committee or Implementation Committee has been proposed which will include representation from all stakeholder groups. This CCC will identify infrastructure and other projects that satisfy immediate needs and do not require a long drawn out planning process. Indications are that the Soum is very enthusiastic about this approach and the transparency that it provides.

Examples of our assistance to date include the provision of winter feed, support to a vermin hunt, support to the annual senior citizens event, the clean out of winter shelters, bore holes being dug, and the clean-up of the Soum landfill site.

Step Three: The long Term Plan

In consultation with the Local Community and Authorities we will develop a longer term Community Development Agreement (CDA). It is early days for BNU and we look forward to collaborating fully in developing this agreement. Any plan will require the buy in of the whole community and aims to further cement the firm bonds that exist between TE and all members of the community. Key to this will be to align the communities’ infrastructure needs to the mine development plan.


To date over 50 % of our employees come from the local community. Terra Energy employs operators, helpers, drivers, and even two geologists – all from Noyon Soum and the surrounding districts.

In addition MONRUD Pacific and other Contractors have employed a large number from the local community and we consider everyone to be part of the Terra Team.

We have a number of examples of locals who started as drivers and helpers and are now driving 777s and other equipment;

Terra Energy remains committed to achieving a goal of 75% of the workforce coming from the local community by the end of 2014 although we expect to lose a few as their skills will be in hot demand as Mongolia continues develop as a country.

Herder Land Use

Baruun Noyon Uul has conducted detailed investigations into how Soum herders use grazing land. Data has been collected from herder households residing close to the different Project components.

Winter Shelters

Winter camps/shelters and corrals are established by herder households and used during colder periods to keep animals gathered together in a shelter. Winter is a sedentary season with few herder families moving at all during this time. Shelters are critical for survival – with winter temperatures averaging minus 30-40oC. Shelters are often located along the foot of hills where water will collect, vegetation is most prolific, and shallow wells are located. Livestock are kept close by, and families use fodder, hay, and wheat to supplement feed for their animals.

Winter shelters normally consist of a built up area for livestock (corral) and storage area, plus a ger and small wood or concrete house. A corral is reported to cost between $800 and $1,000 (USD) to construct using locally-available materials. Winter/spring shelters are made of natural products such as stone, wood and even scrap materials including iron and rubber tyres. They are usually maintained for years, although no precise information is available on how long winter shelters usually last. Herders usually have a hand-dug well or borehole close to their winter shelter.

Loss of Shelters

Some herders are locatedin the settlement area of the mine operation. To ensure the project optimal conditions for development and to ensure the safety and wellbeing of the local population, the company will begin a process of economic displacement (compensation) of these herders.

Terra Energy has realised that only a participative approach may lead to an equitable development of the project and solutions understood and accepted by all the parties. Even small-scale, economic displacement, is considered as a very complex process which is performed by well-defined steps.

Seasonal Migrations and Summer Camps

During summer and autumn when pastures grow, herders move their gers to a location they consider to have good pasture. These summer camps are typically located in the vicinity of hand dug shallow wells that provide water for animals and families. Summer/autumn grazing is practised to allow winter pasture time to recover and to let the livestock gain fat and strengthen. Herders report that cow and camel pastures are within 20-35 km of camps and water, and sheep and goat pastures are within 3-5 km. Herders herd their goats and sheep on a daily basis, but camels, horses and cows do not require daily herding, as they are “semi” wild.