The unlikely Australians are here supporting a growing mining industry, most of which has been led by the Canadians.
The big news this week is Ivanhoe Mines' and Rio Tinto's massive copper-gold project, Oyu Tolgoi, is gearing up to produce 450,000 tonnes of copper per annum within five years.
Rio Tinto announced on June 11 that it expects large-scale production at Oyu Tolgoi – touted as the largest undeveloped copper reserve in the world – to be underway in 2009.
Rio Tinto and Ivanhoe are waiting on final approval for an investment agreement from the Mongolian national parliament and the cabinet before they can crank up the massive project. Rio Tinto expects this to be within weeks.
But there are a host of lesser-known smaller miners and explorers operating in the Land of Blue Skies – making Genghis Khan's old base one of the world's hottest new mining regions.
These include Entrée Gold, Bayfield Ventures and Red Hill Energy.
Vancouver-based Red Hill has two substantial coal projects coming online, the biggest being a 208 million tonne resource of high quality bituminous coal at Ulaan Ovoo (Red Hill).
Red Hill director Paul McKenzie says Mongolia has large untapped mineral resources and its geographical location north of China is advantageous.
Red Hill has also just completed a drilling program on its other coal project, Chandgana Tal, results of which should be released very soon.
Western Australian Sam Williams who runs CAMS, a mine supply company, and CAML, a labour recruitment/hire company in Ulaanbaatar, has been operating in the country for four years and has done well. His firm now employs more than 500 Mongolians.
Williams says a lack of skilled labour is a big problem. Roughly half of the country's population still work as nomadic pastoralists and there is a shortage of tradesmen due to the current mining boom and former governments' socialist policies.
"You may search high and low for a skilled high-voltage electrician but your office cleaner maybe an industrial chemist!" he says.
Other issues include thawing out propane bottles with blowtorches to keep reverse circulation hammers and mud pumps going in -40C conditions; paying compensation to nomads claiming a couple of sheep have been victims of driller's sump oil; and vodka drinking, another Soviet aftertaste.
But there are other less publicised positives of mining in Mongolia.
Williams says characteristics essential to survive as a nomad such as patience, hard work and endurance are also needed to work in mines and exploration teams, so many locals fit well in the world's mining industry.
Interestingly, skilled Mongolian drillers are now in demand in Africa and Australia.
Many local Mongolians welcome the Australian and Canadian miners, which generally use best practice environmental standards.
Ivanhoe is also building health clinics and new roads. They are the responsible face of Mongolian mining, unlike many illegal smaller operations, which use mercury in gold extraction and pollute rivers.
Some are dubbed "ninjas" due to the plastic tubs people carry, which make them look like the TV cartoon characters, the ninja turtles.
The country is still desperately poor and dangerous.
In daylight, drunken brawls break out on the street and pickpockets are rife.
Last year, rioters unnervingly burned a picture of Ivanhoe's principal, Robert Friedland, in protest of government corruption.
Then there are roads, with potholes as big as small cars, and if you get lost, try GPS or Ger (traditional round tent) Positioning System. Find a Ger and ask someone where you are!
Unfortunately Canadian coal explorer Bayfield Ventures has been caught up in a battle over licence ownership for over one year now and a large-scale exploration project with partner BHP Billiton has been held up.
"One of the risks associated to exploration in a new democracy is dealing with governments and courts that are still finding there way," said Bayfield chairman Jim Pettit.
"This process has left $US1 million budgeted for exploration on the table in the past year."
He said when the government changed hands last year, the sentiment in the ministry and the courts toward mining and exploration changed dramatically for the worse.
"This had a negative impact on our case as it worked its way through the courts, however, in the past few months there seems to be a serious move to normalise relations between the mining industry and government and the company looks forward to a positive resolution to this issue in the near future."
