[Federal Register Volume 83, Number 158 (Wednesday, August 15, 2018)]
[Notices]
[Pages 40571-40572]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2018-17574]


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MILLENNIUM CHALLENGE CORPORATION

[MCC FR 18-09]


Notice of Entering Into a Compact With the Mongolia

AGENCY: Millennium Challenge Corporation.

ACTION: Notice.

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SUMMARY: In accordance with Section 610(b)(2) of the Millennium 
Challenge Act of 2003 as amended, and the heading ``Millennium 
Challenge Corporation'' of the Department of State, Foreign Operations, 
and Related Programs Appropriations Act, 2018, the Millennium Challenge 
Corporation (MCC) is publishing a summary of the Millennium Challenge 
Compact between the United States of America, acting through MCC, and 
the country of Mongolia. Representatives of MCC and Mongolia signed the 
compact on July 27, 2018. The complete text of the compact has been 
posted at: https://assets.mcc.gov/content/uploads/compact-mongolia-water.pdf.

    Dated: August 9, 2018.
Thomas G. Hohenthaner,
Deputy Vice President and General Counsel, Millennium Challenge 
Corporation.

Summary of the Mongolia Compact

Overview of MCC Mongolia Compact

    MCC's five-year, $350 million Millennium Challenge Compact with the 
Government of Mongolia (the ``Government'') aims to reduce poverty 
through economic growth by assisting the Government in addressing one 
of the country's most binding constraints to economic growth: 
Inadequate access to water and sanitation in productive sectors and 
poor communities. The Compact will address this constraint through a 
single project that aims to increase the water supply to the capital 
city, Ulaanbaatar.
    The Compact will focus on addressing problems within the water 
sector in Ulaanbaatar, specifically the imminent shortage of water that 
threatens Ulaanbaatar's economy and that could begin to reduce the 
quality of life of its residents as early as 2019. The city currently 
draws its annual supply of 77 million cubic meters of drinking water 
from groundwater aquifers along the upper reaches of the Tuul River, 
which flows through the city. Studies supported by MCC indicate that 
any additional extraction of the groundwater aquifers upstream will 
diminish river flow and cause portions of the river in this area to run 
dry, thus making the upper reaches of the river unavailable for the 
development of future water supplies. The groundwater aquifers located 
along the reaches of the Tuul River downstream from the city must 
therefore support the city's future needs. However, poorly treated 
discharge from the city's outdated and overloaded central wastewater 
treatment plant has contaminated the Tuul River as it flows downstream 
from the city, thereby introducing potentially harmful contaminants 
into these downstream aquifers. The pollution of these aquifers at a 
time of rapid growth in the demand for water only makes the imminent 
water crisis more acute.

Project Summary

    The Compact will address the constraint of long-term water supply 
to Ulaanbaatar through a Water Supply Project, the objective of which 
is to meet the projected demand for water in Ulaanbaatar for 
residential consumers and commercial and industrial users over the 
medium term in ways that are economically and environmentally 
sustainable. The Water Supply Project is composed of three activities:
     Downstream Wells Activity: This activity involves 
expansion of the city's bulk water supply through the construction of 
(i) approximately 52 new wells in two downstream wellfields to supply 
up to 50 million cubic meters of groundwater per year, (ii) associated 
pipelines, transmission lines, and pumps to convey the water, (iii) an 
advanced water treatment plant to produce water that meets drinking 
standards, and (iv) storage facilities, a pumping station and a 
conveyance pipeline to transport finished drinking water into the 
existing municipal water network of Ulaanbaatar. The activity includes 
advanced technology for purification of the water to ensure that water 
supplied to the city is safe and potable.
     Wastewater Recycling Activity: This activity involves a 
significant reduction in the demand for fresh water through the 
construction of (i) a wastewater recycling plant designed to treat a 
portion of the effluent from the central wastewater treatment plant, 
(ii) pumping stations and associated pipelines to convey the recycled 
water to water storage facilities near two large combined heating and 
power plants, and (iii) internal piping, storage facilities and control 
systems to facilitate the use of recycled wastewater for certain 
processes within these combined heating and power plants, which are 
currently the city's largest consumers of freshwater. This activity 
will substitute recycled water for at least 14 million cubic meters of 
freshwater that the combined heating and power plants consume each 
year, with an expectation that the volume will increase over time. The 
wastewater recycling plant will be the first of its kind in Mongolia, 
helping to pave the path for efficient and responsible management of 
the scarce water resources of Ulaanbaatar.
     Water Sector Sustainability Activity: This activity is 
designed to enhance the long-term sustainability of water supplies to 
the capital city through critical policy, legal, regulatory and 
institutional changes, with a particular emphasis on achieving full 
cost recovery and making improvements in operations and maintenance. 
The Water Sector Sustainability Activity includes five sub-activities, 
which will

[[Page 40572]]

support (i) utility-wide financial sustainability and cost recovery, 
(ii) utility cost savings and cost containment for operation in the ger 
areas, (iii) improved utility operational efficiency, (iv) 
environmental sustainability, industrial pre-treatment, and pollution 
control, and (v) public communications, stakeholder engagement, and 
behavior change interventions. This activity will help to ensure that 
the benefits of the Compact reach all citizens of Ulaanbaatar and are 
sustained over the long term.
    MCC estimates that the Water Supply Project will add 64 million 
cubic meters to Ulaanbaatar's long-term supply of water, an 83 percent 
increase in total supply. MCC estimates this volume to be sufficient to 
meet the city's growing demand for water well beyond the end of the 
Compact.

Compact Budget

    Table I presents the Compact budget and sets forth both the MCC 
funding by Compact components and the Government's expected $111.76 
million in a country contribution toward the objectives of the Compact.

                                        Table I--Mongolia Compact Budget
                                                [In US$ millions]
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                                                                                      Compact
                                                                      Program       development      Total MCC
                MCC funding by compact components                  funding under   funding under      funding
                                                                    section 605   section 609(g)
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1. Water Supply Project
    1.1 Downstream Wells Activity...............................         $223.50          $16.00         $239.50
    1.2 Wastewater Recycling Activity...........................           40.95            2.25           43.20
1.3 Water Sector Sustainability Activity........................           17.04            2.96           20.00
                                                                 -----------------------------------------------
        Subtotal................................................          281.49           21.21          302.70
2. Monitoring and Evaluation....................................           10.33            0.03           10.36
3. Program Administration and Oversight.........................           30.12            6.82           36.94
                                                                 -----------------------------------------------
            MCC Funding.........................................          321.94           28.06          350.00
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                  Total compact funding                       Amount
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Total MCC Funding.......................................         $350.00
Government of Mongolia Contribution.....................          111.76
                                                         ---------------
    Total Compact.......................................          461.76
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[FR Doc. 2018-17574 Filed 8-14-18; 8:45 am]
 BILLING CODE 9211-03-P