The first phase of road works at Amur Minerals Corporation’s (LON:AMC) flagship Kun-Manie nickel project in Far East Russia is scheduled to get underway shortly.
The miner has now received topographic and hydrological information, which it will use to draw up the planned 320km long route that will link the mine to the BAM rail line.
Twelve Russian firms that could possibly carry out the first phase of development have already been screened, and Amur has asked two of those to provide a bid for the engineering and design work of the access road.
WATCH: Amur takes 'major step forward' towards Kun-Manie road construction
SIGN UP: Click here to get the Proactive newsletter delivered to your inbox
UK-based Mabey – which specialises in the construction of bridges in arctic environments – will also be on hand to provide additional information, Amur said.
“We are very pleased to have received the topological and hydrological data for our planned access road corridor,” said chief executive Robin Young.
“This enables us to take a major step forward in the evaluation of Kun-Manie by defining project specific capital and operating costs for the road.
“Having screened a group of Russian engineering, design and road construction groups, the first of three phases of road work can begin in earnest.”
Phased approach
Once the preliminary designs have been completed, Amur will then put feet on the ground to carry out various field investigations of the selected route.
Then comes phase two, when the Amur team will prepare and define the route (drilling, trenching, excavation etc.), before the proper construction of the road – phase three – begins.
The AIM-quoted company said this phased approach will allow it to develop the “most efficient route design”.
Low cost, hard-wearing
Given that trucks will transport up to 1mln tonnes of concentrate along the route every year, it will have to be very durable to deal with the constant punishment.
A Russian “technical” class design – sand and crushed stone mix surface – is planned and will be designed for traffic speeds of up to 60km/h.
Amur is also looking at using a geogrid product, which it claims has been proven to extend the life of the road, as well as reducing construction costs by reducing the amount of material required.
Importantly, the product – which would be supplied by Mabey – could also reduce the time needed to build the road, Amur added.
Funding
Undertaking such a large build is never an easy task, particularly from a financial standpoint. Thankfully though, it seems there are a couple of funding options open to Amur.
Amur told investors it is in ongoing discussions with the Far East and Baikal Area Development Fund (FEDF) which could potentially issue low interest rate loans to help finance the infrastructure development.
Nearer to home, another possible source of funding is UK Export Finance and Department of International Trade (UKEF).
Should the Mabey geogrid product account for 20% of the total road construction cost, additional funding from UKEF is possible and Amur would be eligible for low interest loans.
This opportunity will be looked at in more detail once the company has a better idea of the final design and capital costs of the road, Amur said.
Shares were off 5% to 6.2p on Wednesday morning.