Aspire Mining Ltd (ASX:AKM) has received a positive preliminary economic assessment (PEA) for a rail link for its Ovoot Coking Coal Project in Mongolia, from rail design and engineering firm Perfect Road Project LLC.
The PEA confirms a technically and commercially viable 238.6-kilometre line from the Ovoot project to the Mongolia-Russian border port of Arts Suuri.
This extension north-west from Ovoot to Arts Suuri when combined with the planned Erdenet - Ovoot rail line would complete the Mongolian section of the Northern Railway Corridor.
The Northern Rail Corridor is a combined initiative of the Mongolian, Chinese and Russian Governments with the potential to be the fastest, lowest cost rail path linking North Eastern China, Mongolia, Russia and Europe, significantly enhancing regional trade flows and economic benefits.
Importantly, the proposed new rail extension would open up additional Russian and European markets for the potential benefit of Aspire’s coking coal project.
The PEA applied Mongolian class 2 railway design standards to ensure compatibility with the Erdenet - Ovoot rail project and will have up to 15 million tonnes per annum capacity – with additional capacity able to be later added to meet demand growth.
Aspire executive chairman David Paull said: “The delivery of this PEA provides further confirmation of the viability of the Northern Rail Corridor.
“The company has provided this PEA to the Mongolian Ministry of Roads and Transport and Mongolian rail operator UBTZ Railways JSC to provide further justification to proceed to implementing the Ovoot to Arts Suuri rail project as part of the Northern Rail Corridor.’’
Aspire is targeting early production of washed coal from Ovoot within 12 to 15 months of approval and has formulated the Ovoot Early Development Plan (OEDP) including related funding commitments.
In support of the OEDP, the company has executed a cornerstone placement to Mongolian businessman and judo champion Tserenpuntsag Tserendamba, as part of a $15 million strategic financing package.