25.06.2024 Author: Bair Danzanov

The ‘Blue Horse’ of Mongolia and the safety of Lake Baikal – the news is encouraging, but not yet reassuring

The ‘Blue Horse’ of Mongolia

The ‘Blue Horse’ is a project noble in its designs, aiming to bring water to those lands where sand dust rules. Nevertheless, despite all the imaginary (and quite real) prospects created for Mongolia by this initiative, its implementation is almost inevitably associated with negative consequences for the vast Baikal region. Is there an optimal way out of this difficult situation?

Why does the herd need a ‘blue’ horse?

One of the main geographical problems of Mongolia is the extremely uneven distribution of water resources on the territory of the country. The northern and (partially) western regions of Mongolia are rich in fresh water and glaciers, but the South and East of the country face a serious shortage of water resources. To optimise the use of water in such specific conditions, a project was put forward in Mongolia called the ‘Blue Horse’, the essence of which is the use of ‘surpluses’ of this resource for hydropower purposes, as well as to supply water to the southern regions of the country.

For Mongolia, the ‘diversion’ of water from the northern regions of the country to the South seems to be an advantageous means of solving a number of tasks from the shortage of drinking water in the Gobi regions to combating desertification and providing water to the country’s largest mining enterprises, located, with rare exceptions, in the Gobi Desert. The solution to the latter task especially attracts the attention of multinational corporations interested in extracting maximum profit from Mongolia to the project, often disregarding environmental norms and standards. Due to such a layering of factors, in 2019 and 2021 the ‘Blue Horse’ was even added to the main concepts of Mongolia’s development, such as the ‘Long-term Vision 2050’ and the ‘New Recovery Policy’.

Fears of the northern neighbour

In recent years, this project has started to attract the close attention of the Russian public. In mid-2023, the leader of one of the factions of the State Duma of the Russian Federation sent an appeal to Prime Minister Mikhail Mishustin, which mentioned the harm from the implementation of the ‘Blue Horse’ to the ecology of the Baikal region. Indeed, a significant part of the rivers originating in Mongolia feed Baikal, the largest lake in the world in terms of fresh water reserves, with water.

Many initiatives, but different outcomes

A complex examination of the essence of the sinister ‘Blue Horse’ opens up a number of new important aspects for understanding this initiative. The fact is that the ‘Blue Horse’ includes an entire range of independent projects, among the largest of which are the construction of several hydroelectric power plants on rivers belonging to the Selenga basin, the construction of the Orkhon-Gobi and Herlan (Kerulen)-Gobi canals, as well as the canal from Lake Taishir to the city of Altai Gobi-Altai aimag. The first two projects are likely to be dangerous for the Baikal region, but the last two cannot have a noticeable impact on it. The Herlen River (Kerulen) flows into Lake Dalaynor in China, from which a small volume of water flows into the Amur River. The Taishir project, in turn, will take water from an artificial reservoir formed by the Taishir hydroelectric power plant, which has been operating for two decades.

Also, another important moment is that the project was included in government programmes without a detailed description, which indicates that there is no official decision in Mongolia on the implementation of the ecologically dubious Orkhon-Gobi project.  In the programmes for the development of the South Gobi and East Gobi aimags in 2022, the Orkhon-Gobi and Harlan-Gobi projects are described as promising, but require detailed study.

New trends

In recent years, the process of ‘crushing’ this initiative can clearly be seen; a part of the controversial projects is hushed up, the very name of the ‘Blue Horse’ project is not mentioned and only Taishir-Altai, which is already under construction, and Harlan-Gobi appear in the speeches of government officials on the canal projects. In this regard, the rhetoric of the Prime Minister of Mongolia, L. Oyun-Erdene, who in his speech at the Mongolia Regional Development Forum, only mentioned the Herlan-Gobi project instead of the entire ‘Blue Horse’ as a means of overcoming water scarcity in the Gobi economic region of the country. Such a formulation may indicate a political freeze on the most environmentally dubious canal construction projects.

Additionally, the good news is that the preliminary feasibility study of the water supply project for the largest (and dynamically growing) water consumer in the Gobi region, the Oyu Tolgoi copper deposit, sees its connection to the Herlan–Gobi canal and not Orkhon-Gobi.

China stands in solidarity with Russia

A significant deterrent to the promotion of the Orkhon-Gobi project is the position of the PRC on Mongolian projects that can harm the ecology of certain regions of Russia. Historically, Chinese technical and credit participation has been frozen in the construction of the Egiin Gol hydroelectric power plant by Mongolia, which could have led to a reduction in water supply to Lake Baikal, as a sign of respect for the concerns of the Russian side. The large-scale Orkhon-Gobi project, involving the construction of a large dam and a canal hundreds of kilometres long, seems too expensive for Mongolia and is therefore impossible without the participation of large investors like China. Chinese companies are already participating in promoting Harlan (Kerulen), which is safe for Lake Baikal, however there is no such information about Orkhon-Gobi.

Nevertheless, despite a number of such encouraging moments, the threat to Lake Baikal from future projects in Mongolia still persists; no one in Mongolia has yet announced an official rejection of the Orkhon-Gobi project and the Egiin Gol hydroelectric power plant project on the largest tributary of the Selenga, which was included in the framework of the ‘Blue Horse’, is increasingly described by the Mongolian authorities as promising. The ‘Blue Horse’ does not leave the Mongolian media and public discussion either.

Multinational corporations are unlikely to back off

The expansion of mining volumes in the Gobi region of Mongolia remains relevant, which will inevitably lead to an increase in the demand of mining and processing enterprises for water. We may recall that one of the largest projects is the Oyu Tolgoi field, where a deep mine was commissioned in 2023, but has not yet reached full capacity, and the oil refinery under construction in the South Gobi aimag will also require additional water sources for its operation. In this regard, the plans of Mongolia and France for the development of uranium mining at the large Dzuvch-obo deposit in the East of the Gobi are not comforting either. In addition, active geological exploration is currently underway in various somons of the South and East Gobi aimag, focusing on the search for deposits of uranium, rare earth metals, coal, copper and oil. All this suggests that the dilemma of environmental safety and the enrichment of multinational corporations will not go away in the coming decades and will increasingly influence decisions that can negatively affect the ecology of the vast Baikal region.


Bair Danzanov, independent expert on Central Asia and Mongolia, exclusively for the online magazine “New Eastern Outlook

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