http://news.yahoo.com/s/nm/20080703/wl_nm/mongolia_dc_9

Calm has returned to the Mongolian capital Ulan Bator after rioting in the wake of election fraud allegations left five dead, but there is still no official result from the weekend's parliamentary polls.

The violence has dampened hopes for a period of stable government to develop the mining sector and tackle inflation in the vast but thinly populated country, strategically sandwiched between China and Russia.

A curfew has been imposed in Ulan Bator, though the situation on the streets appeared to have returned to normal following the violence, in which protesters clashed with police and set fire to the ruling Mongolian People's Revolutionary Party (MPRP) headquarters.

The General Election Committee announced preliminary results on national television late on Wednesday, though did not say specifically to which parties the winners belonged.

According to Reuters calculations, the ruling MPRP has won 45 seats while the opposition Democratic Party has won 27, which would give the MPRP a clear majority in the 76-seat parliament.

Two of the seats are still undecided, and a few others have gone to small parties or independents.

International observers say overall the election was free and fair. But new election rules have led to procedural problems and some confusion over counting.

President Nambariin Enkhbayar declared a four-day state of emergency late on Tuesday after the protests.

The emergency rule -- the first in Mongolia's history -- means protests are banned and security forces can use tear gas and rubber bullets to break up demonstrations.

The uncertainty threatens to further delay deals that could unlock vast reserves of copper, coal, uranium and other resources beneath the country's vast steppes and deserts, seen as key to lifting the landlocked Central Asian state out of poverty.

The biggest project at stake is at Oyu Tolgoi, also known as Turquoise Hill, backed by Ivanhoe Mines of Canada and Rio Tinto.

The two companies propose to spend up to $3 billion developing the field. Rio paid $303 million for a 10 percent stake in Ivanhoe in 2006. It has said it could invest up to $1.5 billion, under defined conditions, when the deal is approved.