The state-owned miner of the coveted Tavan Tolgoi project has been planning to list the eastern Tsankhi block of the Tavan Tolgoi project for a long time, but the fundraising has been constantly postponed.

Located in the South Gobi desert Tavan Tolgoi – mined since the 60s – is home to the world’s largest high-quality coking coal deposit used in steelmaking, but management of the resource has been characterized by bureaucratic bungling.

In January the cash-strapped company suspended all coal exports to neighbouring China from Tavan Tolgoi which boasts a 7 billion tonne total resource a in a wrangle over pricing.

The country last year stopped all talks with international miners on developing the West Tsankhi, which on its own holds 1.2 billion tonnes.

Mongolia’s National Security Council rejected a development deal struck with US giant Peabody Energy, Shenhua and a Russian-Mongolian consortium mid-September 2011, just two months after they were announced as winners.

In January E-TT’s chief executive, Batsuuri Yaichil, told Reuters that the company was under severe financial strain, and that Mongolia would delay the long-awaited international IPO for Tavan Tolgoi’s eastern block until the market improved, likely sometime in 2014.

Mongolia is walking a diplomatic tightrope with Tavan Tolgoi. Aside from closer ties with China, it wants to use the project to strengthen its long-time political and cultural links with Russia and —at the same time— make room for the US as a geopolitical balancer in Asia.

Image of Tavan Tolgoi, Wiki Commons