MT Petrol Phase II



Project number:


Business sector:

Natural resources

Notice type:


Environmental category:


Approval date:

13 Apr 2011



PSD disclosed:

23 Feb 2011

Translated version of this PSD: Mongolian

Project Description

The EBRD is considering providing a loan of up to US$ 50 million to Magnai Trade Group in Mongolia. The proceeds of the loan will be used to support the second stage of the Group’s development, funding the construction of new depot stores and further expansion of the gas filling stations network in Mongolia. A portion of the loan will be used for the the rehabilitation of logistics, diversification of the group’s business through the import and distribution of liquefied petroleum gas (LPG) and introduction of a Management Information System.

Transition Impact

Transition impact potential of the Project comes from

(a) support of private sector development and increased competition in the local petroleum sector; and

(b) further improvements in business, EHS and corporate governance practices.

Demonstration Effect of Higher Corporate, Business and Environmental Standards

The proposed transaction will improve standards in various areas:

(a) Increase transparency through an improvement on capital budgeting, financial reporting and cost-control procedure;
(c) Building of the good EH&S improvements of the first projects, through a landmark EH&S training by highly qualified international EH&S consultants;
(d) Introduction of a corporate EH&S code of conduct for upstream sector and commitment to comply with EITI principles;

Support to private sector and increased competition

The proposed financing will help strengthen the private petrol distribution business in Mongolia as well as increase competition. The Company will also be a new entrant in the liquefied petroleum gas (LPG) market.

The Client

Magnai Trade LLC, a medium-sized Mongolian Company specialised in importing and distributing petroleum products throughout Mongolia.

EBRD Finance

A term loan of up to USD 50 million.

Project Cost

US$ 83 million.

Environmental Impact

The project is screened B. Environmental due diligence included a visit by the Bank’s Environmental Specialist and an Independent Consultant in February 2011. The environmental audit and analysis was carried out by the Independent Consultant, and a comprehensive Environmental and Social Action Plan (ESAP) is being developed. Issues addressed in the ESAP include environmental management and monitoring, air emissions, hazardous materials transport and storage, waste management; health and safety and labour issues, fire and franchise management. The independent audit also confirmed that the Company is complying with the ESAP agreed under the first project in a timely manner.

The new ESAP identifies further mitigation measures to address all outstanding environmental, health and safety issues associated with the current transaction.

Technical Cooperation


Company Contact

Magnai Trade Co. Ltd.
Ikh Toiruu 14, MT Building
Ulaanbaatar 20
PO Box 336, Mongolia


Business opportunities

For business opportunities or procurement, contact the client company.

For state-sector projects, visit EBRD Procurement: Tel: +44 20 7338 6794

General enquiries

EBRD project enquiries not related to procurement:
Tel: +44 20 7338 7168

Public Information Policy (PIP)

The PIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations. Please visit the Public Information Policy page below to find out how to request a Public Sector Board Report.
Text of the PIP

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