The Mongolian parliament has revoked a four-year suspension on granting new mineral exploration licences to attract investments in the sector and boost economy.

The parliament has amended the 2006 Minerals Law to implement policy changes pertaining to exploration and related investments.

The amendments, which will be effective after their formal publication, extend the mineral exploration period to 12 years from the current nine.

"The new mining and energy laws may lead to $1bn in new investments."

The draft bill provides for the formation of a national geological survey and the creation of a policy council, to address the challenges faced by the mining industry.

Mongolia mining vice-minister Erdenebulgan Oyun told Bloomberg in May that mining law amendments will increase the area available for mining and exploration to 20% from about 8%.

The move is part of Mongolian Prime Minister Altankhuyag Norov’s plan to boost the nation’s economy within 100 days, following two years of slow growth and dwindling foreign investments.

Declining coal prices and disputes with foreign investors have contributed partly to the fall in foreign direct investment (FDI). The FDI fell 52% last year and 64% in the first five months this year, reported Bloomberg.

Oyun noted that the new mining and energy laws may lead to $1bn in new investments.

Ministry of Mining department of strategic policy and planning director general Otgochuluu Chuluuntseren said passage of the amendments may also lead to the revocation of last year’s cancellation of 106 mining licences.

In addition to mining law, the parliament has also voted against the government proposal to buy a 34% stake in the Tsagaan Suvarga copper and molybdenum project owned by Ulaanbaatar-based Mongolyn.