NALAIKH, MONGOLIA—Holding his youngest daughter in his arms, Baasanbayar looks over the bleak landscape that has been his home for 12 years.

In the foreground, slag heaps and dozens of rudimentary mine shafts are visible. In the distance, the long-abandoned buildings that once belonged to the state-owned mining company are crumbling, their windows smashed and many of their walls caved in.

“This isn’t a good place to live,” he says. “But I don’t know how to change this life.”

Mining executives have been flocking to Mongolia, desperate to be part of one of the biggest mining booms in history.

Next month, Oyu Tolgoi, the largest mine in the country and one of the three biggest copper-gold mines in the world, will open, pumping billions of dollars a year into the economy. Vancouver-based Turquoise Hill Resources is one of its owners.

Yet, Oyu Tolgoi only tells part of the story of mining in Mongolia.

Nalaikh, the country’s first mining town, is a stark reminder of the boom-and-bust nature of mining and the devastating effects it can have on the environment and people. Once the main source of Mongolia’s coal, it is now a poverty-stricken and forgotten part of the country.

In March 2011, six miners were killed here when a coal mine — one of the nearly 1,000 makeshift and unregulated mine shafts that now litter the area — collapsed around them.

A few days after the miners’ deaths, the thousands of others who work the cratered landscape were back at work. They had little choice.

The following day, another miner died after inhaling underground toxic gases.

According to official estimates, upwards of 50 lives were lost in mining accidents between 2009 and 2011.

“You often hear about deadly accidents. Hot air and moisture loosens the mud and the roofs fall in,” says Baasanbayar, 30, who lives with his wife and three young daughters.

“Three years ago, I was trapped underground for hours. The mud comes down without any sound so you don’t hear it coming and can’t prepare.”

Baasanbayar spent three months in bed recovering. Then he resumed mining.

Locals had little choice but to continue mining, taking over or developing new shafts with friends and family, dragging out coal using antiquated tools and almost no safety devices. Small trucks arrived each day to haul the coal to the capital, their owners paying the miners for each truckload in cash.

Today, the landscape is devastated. The few large mining buildings that remain are abandoned shells, supplanted by clusters of grey tents. Open mine shafts burrow under the roads and, according to locals, often intersect.

“Coal is a finite resource so in 20, 30 years maybe it will be gone. We need to factor in these costs,” says Saurabh Sinha, an economist with the United Nations Development Program in Ulan Bator. “Abandoned mines and non-diverse economies are a serious issue.”

Bolor Naranhuu, a former policy analyst at the Mongolian National Mining Association and currently a freelance consultant based in Toronto, says many regions in Mongolia have overlooked artisanal gold and coal miners.

“The sad fact is there is still a lot of illegal mining. There are a huge number of people working like this. Most were former herders who lost everything in the 1990s or in subsequent winters. There is a huge army of people with nothing. No skills, no education.”

“In winter, most of Nalaikh works here. Most of the town’s income comes from the mining,” she says with a resigned expression.

With little education and few economic alternatives, young men and women in the area have few options.

“Nalaikh is not a good or a bad place,” Arkhangai says. “There is just enough business for me and my shop.”

Nearby, three men are busy renovating a disused mine shaft — digging out mud, fumigating and reinforcing support beams — for the coming winter. The eldest, Batbaatar, 43, has been working informally in mines for 20 years.

“We don’t pay taxes, so don’t get medical (care) or a pension from the state when we retire. We receive nothing from the bosses if we get hurt or die.”

Most of the mine shafts around Nalaikh, which has a population of about 20,000, are run by small groups of individuals or an informal boss who rents the land— or simply pays the owner for electricity — in order to dig.

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“We have a small team of 10 of us involved. We also have a nighttime team so we can work the shaft 24 hours,” says Batbaatar.

Working 12-hour days, miners can earn up to $420 a month. Underground gases make it too dangerous except during the long winters when temperatures can drop to minus 25 underground and minus 40 above. “If we stop working we start to freeze,” says one of the miners.

The area around Nalaikh is devoid of trees and vegetation. Batbaatar says it is becoming harder to get the wood needed to shore up the shafts, making mud slides a constant danger.

“The government tries to stop wood being brought here to us, so we can’t buy the wood needed to make the mines safe even if we want to,” he says, sitting beside the half-redeveloped shaft as a battered pipe exhausts the bad air sucked up below by a diesel generator.

“We are seeing a lot of prosperity in Ulan Bator,” says the U.N.’s Sinha, “but there is a big concern that some sections of the population are missing out.”

Six hundred kilometres south of Nalaikh, right on the border with China, the mega-mine Oyu Tolgoi is about to go into production. Developed by Turquoise Hill (formerly Ivanhoe Mines), it already contributes 30 per cent of the country’s GDP. Yet even when fully operational, the mine will only employ 15,000 workers.

“These big new mines are capital-intense not people-intense,” says Naranhuu. “There needs to be huge government investment in rural areas to improve employment options. There are capable young men and women in villages across the country who do nothing all day because they have no opportunities.”

Those in Nalaikh have been watching reports on developments like Oyu Tolgoi with interest. But the boom and the money seem out of reach.

“I tried to apply for a job at Oyu Tolgoi, but there is too much official paperwork needed,” says Baasanbayar, watching his daughter run around piles of coal.

“They asked about university education in mining, or official experience. It doesn’t matter if you’ve worked for years, if you don’t have papers they won’t give you a chance.”

At the entrance to a nearby mine shaft Bayaraa, 32, stands smoking a cigarette. The shaft vanishes quickly into the ground at a seemingly impossible angle. Yak skulls litter the nearby ground.

“People in Nalaikh don’t have jobs. It is all informal work. It is the hardest work, in the hardest condition — all in order to make a living.”

Like many, Bayaraa grew up a nomadic herder before successive winters wiped out his family’s livestock. He arrived in Nalaikh a decade ago and has been unable to find any other work since.

“Now I’m getting old, so it is harder for me to work underground. After two hours I need to rest and go above ground to look after the coal winch for a bit.”

With a shake of the head he adds: “I have to support my family somehow.”

Kit Gillet is a freelance journalist currently based in Beijing.