Entrée Resources says Mongolia tax documents remain unconfirmed

Entrée Resources said it is still working to transfer the Shivee Tolgoi and Javkhlant mining licences to its joint venture partner Oyu Tolgoi LLC, after questions were raised in a Mongolian parliament plenary session on 2 October. The company said the transfer process must follow Mongolian law and that discussions with the Government Working Group and other Oyu Tolgoi stakeholders over state participation in the area of the licences are ongoing.

The company said the licences must be transferred to Oyu Tolgoi LLC for Lift 1 underground development and extraction activities on the Shivee Tolgoi licence to proceed. It also said transfer tax based on the value of the licences must be paid under Mongolian law, and that the licence holder is responsible for calculating the value using the prescribed methodology before asking the Mongolian tax authority to review and confirm it.

Entrée LLC said it, with support from Oyu Tolgoi LLC and their legal and tax advisers, calculated the value of the licences, remitted the applicable transfer tax to the tax authority and filed a request for review and confirmation. It said supporting documents, including receipts showing the tax payment, were also submitted.

To date, the Mongolian tax authority has not confirmed Entrée LLC’s valuation calculations. The company said the authority advised that the submitted documents and materials were incomplete and that it is therefore not possible to issue tax payment certificates.

Entrée said further details are available in its continuous disclosure record, and described itself as a Canadian mining company with a carried joint venture interest in part of the Oyu Tolgoi project in Mongolia.