GRANTING AND EXTENDING THE TERM OF AN PETROLEUM EXPLORATION LICENSE
According to the Law of Mongolia On Petroleum (the new edition), the “Contractor” means a company that entered into a contract to conduct petroleum exploration or exploitation within the territory of Mongolia. A contractor specified shall submit its application for an exploration license to the Ministry of Mining.
The following documents shall be appended to the application for an exploration license:
1. A copy of the production sharing agreement ;
2. An environmental impact assessment;
3. A draft of the work project and plan to be performed during the respective year; and
4. Proof of deposit of the funds specified in clause 11.2.9 of the Petroleum law.
The Ministry of Mining shall review the documents and issue or extend the term of an exploration license to a body mentioned below for a period of exploration:
• An production sharing agreement concluded outright based on the results of prospecting work; or
• Upon holding an open tender pursuant to Article 19 of the Petroleum law, a contract concluded pursuant to Article 21 of the Petroleum law.
A term for petroleum exploration shall be up to 8 years, and Petroleum Agency may extend twice this period by up to 2 years. A term for unconventional petroleum exploration shall be up to 10 years, and Petroleum Agency may extend this period once by up to 5 years. And an exploration term shall be counted beginning from a day a production sharing agreement was made. A term of an exploration work plan and budget shall be continue for and calculated in calendar years.
The Petroleum Authority shall approve the exploration work plan within 120 days of concluding the production sharing agreement, and starting from the next year - within the first quarter of a successive year.
Source: Law of Mongolia On Petroleum (the new edition)