Aspire Mining’s Mongolian rail subsidiary Northern Railways LLC has received confirmation of an 18 month extension to the time required to complete the conditions precedent for the Erdenet to Ovoot Rail Concession Agreement. The extension was granted by Mongolia’s National Development Agency.
The activities required for the agreement include completion of feasibility studies, environmental studies and permits, land use agreements, commercial agreements including the EPC Contract and its funding.
Northern Railways now has until August 2018 to complete all the conditions for the Erdenet to Ovoot Railway.
The Mongolia Cabinet has also approved a submission from Northern Railways to alter the alignment on the approach to Erdenet in order to avoid a potential overlap with other infrastructure. This opened the way for approval for the extension in accordance with the Rail Concession Agreement.
Engineering work carried out as part of the submission shows that the alternative alignment will not add to the capital or operating costs of the new railway in northern Mongolia.
On January 9 ASX-listed Aspire announced that Northern Railways had received the first stage of the feasibility study from China Railway First Survey and Design Institute Group Co Ltd, a subsidiary of China Rail Construction Corporation that confirmed the Erdenet to Ovoot Railway is financially feasible and recommended construction to commence as soon as possible.
Aspire is the largest coal tenement holder in Mongolia’s northern provinces and owns the Ovoot Coking Coal Project, which is the second largest coking coal project by reserves in Mongolia. Development of Ovoot is dependent on construction of the railway.