Aspire Mining Ltd (ASX:AKM) and its investment partner in the Erdenet to Ovoot Rail Project in Mongolia will extend the option period for an investment agreement in order to confirm future rail capacity guarantees.
China Gezhouba Group Corporation International Ltd (CGGC) has agreed with Aspire and its rail subsidiary Northern Railways LLC to extend the option for three months to 15 May 2018.
The future capacity guarantees are being sought for freight from Northern Railways south along the Trans Mongolian Railway.
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CGGC has confirmed that the guarantees are the only outstanding documentation required for approval of its investment into the project.
A binding MOU was signed in October 2017 providing for CGGC to complete the final feasibility study for the rail project.
CGGC was also given the opportunity to earn a 51% shareholding in Northern Railways by funding it to complete the other conditions of the concession agreement with a decision to be made by 15 February 2018.
Ulaanbaatar Railways JSC has confirmed that Northern Railways' freight demand along the Trans Mongolian Railway has been included in its forward capacity planning.
The extension will allow the partners to discuss with other stakeholders the securing of future commitments to carry freight.
Feasibility study completion brought forward
CGGC has also confirmed that the feasibility study, which was due to be delivered on or before 31 March 2018, is now expected to be submitted by the end of February.
Completion of the study is a key condition in the concession agreement and will allow for more advanced funding discussions with potential investors, including China Development Bank.
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Aspire also has the Nuurstei and Ovoot coking coal projects, which will benefit from the Erdenet to Ovoot Rail Project and the eventual Northern Rail Corridor through northern Mongolia to Russia.