Agreement signed to develop Mongolian railway
The
Mongolian Ministry of Roads and Transportation has signed an agreement
with JSC Russian Railways to modernise and extend Mongolia’s rail
network.
The agreements were signed during a weeks visit to Mongolia by Russian President, Vladimir Putin.
Along with modernising and expanding the operations and capabilities of Ulaanbaatar Railways, it was also agreed to investigate the expansion of railway in northern Mongolia from Erdenet past Aspire Mining’s Ovoot coal project to the Russian border at Arts Suuri.
Russia and Mongolia are hoping to improve Russian transit freight to China through Mongolia’s rail network – increasing it from a relatively nominal amount at present to 20 million tpa by 2020.
The priority in modernising and expanding the railway is to develop the dual tracking of the main trans-Mongolian railway, which will increase rail capacity to 100 million tpa. The two parties will also examine the feasibility of electrifying this line.
Aspire Mining noted that the agreement could have significant implications for its Ovoot metallurgical coal project – linking the mine into the Russian rail system to encourage transit freight from Russia.
Aspire’s managing director, David Paull, said “Aspire and our subsidiary, Northern Railways, welcomes this important new rail agreement between Russia and Mongolia that explicitly recognizes the Ovoot coking coal project as a key user of this new rail transit corridor. This agreement officially puts rail in the north of Mongolia on the map.”
“Northern Railways continues to be in close contact with UBTZ with regards to working together through the next steps and a joint development of the Erdenet to Ovoot (Northern Rail Line) section,” Paull added.
The agreements were signed during a weeks visit to Mongolia by Russian President, Vladimir Putin.
Along with modernising and expanding the operations and capabilities of Ulaanbaatar Railways, it was also agreed to investigate the expansion of railway in northern Mongolia from Erdenet past Aspire Mining’s Ovoot coal project to the Russian border at Arts Suuri.
Russia and Mongolia are hoping to improve Russian transit freight to China through Mongolia’s rail network – increasing it from a relatively nominal amount at present to 20 million tpa by 2020.
The priority in modernising and expanding the railway is to develop the dual tracking of the main trans-Mongolian railway, which will increase rail capacity to 100 million tpa. The two parties will also examine the feasibility of electrifying this line.
Aspire Mining noted that the agreement could have significant implications for its Ovoot metallurgical coal project – linking the mine into the Russian rail system to encourage transit freight from Russia.
Aspire’s managing director, David Paull, said “Aspire and our subsidiary, Northern Railways, welcomes this important new rail agreement between Russia and Mongolia that explicitly recognizes the Ovoot coking coal project as a key user of this new rail transit corridor. This agreement officially puts rail in the north of Mongolia on the map.”
“Northern Railways continues to be in close contact with UBTZ with regards to working together through the next steps and a joint development of the Erdenet to Ovoot (Northern Rail Line) section,” Paull added.
Joint venture to construct Sino-Mongolian railway
Chinese
state-owned mining group Shenhua, which operates 1765 km of coal
railway in China, has signed a joint venture agreement to develop a
cross-border rail link to serve the Tavan Tolgoi coalfield in the South
Gobi region of Mongolia.
Gashuunsukhait Railway Company will invest in the construction of a railway project at the Sino-Mongolian border crossing, which will be a standard gauge (1435 mm) cross-boundary cargo transportation railway with approximately 20 km in length connecting the Gashuunsukhait boundary control point in Mongolia and the Ganqimaodu boundary control point in China.
Shenhua Baoshen Railway Company Limited, a Shenhua subsidiary, will be responsible for the operation, transportation and maintenance of the Sino-Mongolian border crossing railway in accordance with the operation and maintenance contract.
Mongolian firms
Under an agreement signed in Ulaanbaatar on 7 April 2014, Shenhua will hold a 49% interest in a joint venture being formed to progress the project. A consortium of Mongolian firms, including Erdenes Tavan Tolgoi, Energy Resources LLC and Tavan Tolgoi, will hold the remaining 51% stake.Gashuunsukhait Railway Company will invest in the construction of a railway project at the Sino-Mongolian border crossing, which will be a standard gauge (1435 mm) cross-boundary cargo transportation railway with approximately 20 km in length connecting the Gashuunsukhait boundary control point in Mongolia and the Ganqimaodu boundary control point in China.
Reduce transport costs
The construction of the Sino-Mongolian Border Crossing Railway will help reducing transportation costs and promoting Sino-Mongolian coal trading.Shenhua Baoshen Railway Company Limited, a Shenhua subsidiary, will be responsible for the operation, transportation and maintenance of the Sino-Mongolian border crossing railway in accordance with the operation and maintenance contract.
Rail funding will unlock Mongolian coal potential
Aspire
Mining’s Ovoot coking coal project looks set to take a major step
forward after the company received several non-binding Expressions of
Interest (EOI) totalling US$ 1.3 billion for financing of the Northern
Rail Line in Mongolia.
Capital expenditure
The US$ 1.3 billion total equates to the capital expenditure estimate for the Northern Rail Line as highlighted in the Rail Pre-Feasibility Study completed by SMEC International in April 2013.Rail concession
Aspire Mining sourced the EOIs from a number of financial institutions and the Noble Group, as part of its ongoing discussions with the government of Mongolia in relation to the grant of a rail concession. Although the EOIs are non-binding, they indicate a broad interest to fund the Northern Rail Line.Northern Rail Line
The Northern Rail Line project is the focus of Northern Railways LLC, Aspire’s Mongolian infrastructure subsidiary that seeks to extend the Trans-Mongolian Railway from its current terminus at Erdenet through to the Ovoot coking coal project.Export opportunities
The rail line will be multiuse, providing an alternative, cheaper and environmentally friendly transport solution for agricultural products, general freight, bulk materials and passengers. The operation of the Northern Rail Line will assist the sustainable long-term growth of local industry and the economy through the creation of jobs, resource and small-medium business development, and export opportunities.Mongolian coal railway proved to be viable, with cost savings identified
As
Aspire Mining’s Ovoot metallurgical coal project in Mongolia makes
strides toward commercialisation, the company has received a boost
following a field inspection of its planned Northern Rail Line.
The company is looking to extend the existing Trans-Mongolian railway, which currently spans approximately 406 km from Erdenet to Moron, by a further 222 km. The rail line would connect the Ovoot coal project with Erdenet.
The field inspection focused on the constructability of the rail extension from the point of view of construction logistics, geotechnical, hydrology, environmental, river crossings and railway operations.
The report from the field inspection confirmed that the project is viable from an engineering and railway operational aspect, as well as identifying potential cost savings.
The reduced capital cost could support further infrastructure development for the Ovoot project.
Key findings from the field inspection included:
During the inspection, the field team “encountered nothing that would prevent the railway from being built, nor anything that would add to the estimated cost,” the company said.
It was also noted that “permafrost, while still a potential hazard, appears to be receding and will probably prove to be not as significant an issue as anticipated and budgeted for.”
Aspire’s managing director, David Paull, commented that “This study further confirms the Northern Railways Erdenet to Ovoot rail project as a viable and efficient solution to bring Ovoot metallurgical coal, and other resource and agricultural products from northern Mongolia to world markets. The company continues to engage with the Government of Mongolia in its evaluation of the benefits of this rail project to the country.”
A revision to the original rail pre-feasibility study identified a lower US$ 1.3 billion capital expenditure for the northern rail line. This figure represents US$ 200 million in savings, without taking into account likely operating costs.
Aspire’s project has the potential to export coal to Eastern Europe, Russia, and also China. The reduced cost for the northern rail line will support the company’s claim it has the potential to be a competitive coal export company to these regions.
Last week, Aspire signed off-take agreements for coal sale export contracts with a company in Russia. In the agreement, 5000 tpm of coal would be exported via rail to Russia.
The company is looking to extend the existing Trans-Mongolian railway, which currently spans approximately 406 km from Erdenet to Moron, by a further 222 km. The rail line would connect the Ovoot coal project with Erdenet.
The field inspection focused on the constructability of the rail extension from the point of view of construction logistics, geotechnical, hydrology, environmental, river crossings and railway operations.
The report from the field inspection confirmed that the project is viable from an engineering and railway operational aspect, as well as identifying potential cost savings.
The reduced capital cost could support further infrastructure development for the Ovoot project.
Field inspection
Key findings from the field inspection included:
- The logging of 14 potential quarry sites for ballast across the 547 km alignment. The spacing of these potential quarry sites is such that distances from the rail line are no more than 30 km.
- The length of rail line that could potentially be affected by permafrost conditions is 139 km, which is substantially less than the 200 km previously assumed. No frozen ground conditions were encountered during the field visit.
- The field visit identified 12 locations where changing the alignment of the line slightly should result in the reduction of three large bridge structures, reduce the length of a number of large bridges, avoiding swampy ground and route around a congested industrial zone of Erdenet city, where the Northern Rail Line will connect and rail yards will need to be constructed.
During the inspection, the field team “encountered nothing that would prevent the railway from being built, nor anything that would add to the estimated cost,” the company said.
It was also noted that “permafrost, while still a potential hazard, appears to be receding and will probably prove to be not as significant an issue as anticipated and budgeted for.”
Viable project
Aspire’s managing director, David Paull, commented that “This study further confirms the Northern Railways Erdenet to Ovoot rail project as a viable and efficient solution to bring Ovoot metallurgical coal, and other resource and agricultural products from northern Mongolia to world markets. The company continues to engage with the Government of Mongolia in its evaluation of the benefits of this rail project to the country.”
A revision to the original rail pre-feasibility study identified a lower US$ 1.3 billion capital expenditure for the northern rail line. This figure represents US$ 200 million in savings, without taking into account likely operating costs.
Aspire’s project has the potential to export coal to Eastern Europe, Russia, and also China. The reduced cost for the northern rail line will support the company’s claim it has the potential to be a competitive coal export company to these regions.
Last week, Aspire signed off-take agreements for coal sale export contracts with a company in Russia. In the agreement, 5000 tpm of coal would be exported via rail to Russia.
Mongolian coal bound for Europe
Aspire
Mining Ltd has signed a non-binding Memorandum of Understanding (MOU)
with the operator of Taman port, enabling metallurgical coal from its
Mongolian Ovoot project to access the Black Sea, and from there be
exported to Eastern Europe.
A further non-binding MOU has been signed between Aspire and the terminal operator of the Nakhodka Port on the eastern coast of Russia, providing options to export the coal to north Asian markets.
The coal terminal at the Black Sea port of Taman is currently under construction, and is expected to be completed in 2015. The Taman port is designed to accommodate capsize vessels, which can travel to destinations either bordering the Black Sea or Europe, allowing Ovoot coal to be delivered to steel industries in Turkey, eastern and southern Europe.
The Ovoot metallurgical coal project is scheduled for commissioning in 2017, with Aspire hoping to produce 10 million tpa of metallurgical coal from 2020.
The MOU between Aspire and the Taman port operator will run for a term of five years, commencing from the first delivery of Ovoot coal. The port will handle volumes of up to 2 million tpa of Ovoot coal.
The non-binding MOU between Aspire and Nakhodka compliments an MOU that Aspire entered into in January 2013 with Noble Group, which provided a way for Aspire to access Noble’s recently acquired interest in the Nakhoda port.
Access to the port on Russia’s east coast allows Aspire to export coal from its Ovoot project to north Asian markets, including Japan, Korea, Taiwan, Vietnam and southern China.
Aspire’s managing director, David Paull, said of the MOUs that they “Are important in outlining the company’s strategy for geographically diversifying the customer base for the Ovoot coal project. There is now an identified path for Ovoot project coal from Northern Mongolia to penetrate European markets. The agreement with the Russian coal terminal operator along with the previously disclosed Noble Agreement now provides for sufficient volume and flexibility in meeting the Ovoot project’s Far East Russian port needs in delivering metallurgical coal into North Asia’s seaborne markets.”
Ovoot is the second largest coal reserve in Mongolia, with an estimated total of 184 million t of metallurgical coal available over a mine life of 20 years.
A further non-binding MOU has been signed between Aspire and the terminal operator of the Nakhodka Port on the eastern coast of Russia, providing options to export the coal to north Asian markets.
Europe
The coal terminal at the Black Sea port of Taman is currently under construction, and is expected to be completed in 2015. The Taman port is designed to accommodate capsize vessels, which can travel to destinations either bordering the Black Sea or Europe, allowing Ovoot coal to be delivered to steel industries in Turkey, eastern and southern Europe.
The Ovoot metallurgical coal project is scheduled for commissioning in 2017, with Aspire hoping to produce 10 million tpa of metallurgical coal from 2020.
The MOU between Aspire and the Taman port operator will run for a term of five years, commencing from the first delivery of Ovoot coal. The port will handle volumes of up to 2 million tpa of Ovoot coal.
North Asia
The non-binding MOU between Aspire and Nakhodka compliments an MOU that Aspire entered into in January 2013 with Noble Group, which provided a way for Aspire to access Noble’s recently acquired interest in the Nakhoda port.
Access to the port on Russia’s east coast allows Aspire to export coal from its Ovoot project to north Asian markets, including Japan, Korea, Taiwan, Vietnam and southern China.
Geographical diversity
Aspire’s managing director, David Paull, said of the MOUs that they “Are important in outlining the company’s strategy for geographically diversifying the customer base for the Ovoot coal project. There is now an identified path for Ovoot project coal from Northern Mongolia to penetrate European markets. The agreement with the Russian coal terminal operator along with the previously disclosed Noble Agreement now provides for sufficient volume and flexibility in meeting the Ovoot project’s Far East Russian port needs in delivering metallurgical coal into North Asia’s seaborne markets.”
Ovoot is the second largest coal reserve in Mongolia, with an estimated total of 184 million t of metallurgical coal available over a mine life of 20 years.
Mongolian coal will be exported to Russia
Prophecy
Coal has announced it has entered into two binding coal sale export
contracts with a company in Russia, for the sale of coal sourced from
the company’s Ulaan Ovoo mine.
The buyer is thought to be based in Russia’s Buryatia region. This region in Russia, with a consumption rate of 6 million tpa of thermal coal, is currently facing a substantial coal shortage due to declining coal production.
Ageing local coal mines in the region have caused coal production in the area to decline. An un-interrupted supply of coal from Ulaan Ovoo through sustainable mining is therefore seen as essential to meeting growing regional demand for premium thermal coal.
Under the off-take agreements, 5000 tpm of coal will be exported through Northern Mongolia’s Sukhbaatar rail station, a major Mongolian gateway to Russia, which joins the Russian trans-Siberian railway.
Fresh coal deliveries via the Mongolian rail line are expected to commence in November 2013. This should coincide with the resumption of mining activities at Ulaan Ovoo, following the completion of pit-dewatering activities.
Prophecy has a coal stockyard and rail siding at Sukhbaatar, with a loading facilitiy capable of supporting up to 80,000 tpm of coal movement.
The company continues to work with Russian and Mongolian officials in re-opening the Zeltura crossing between the two countries, which is currently closed. The crossing lies 20 km from Ulaan Ovoo, meaning that if it were to reopen, the mine could further increase export sales volume.
One of Prophecy’s mining competitors in Mongolia, Aspire Mining, has also recently indicated coal from its Ovoot project could be exported to Russia. The company is looking at extending the 406 km of rail line that currently runs between Erdenet and Moron.
The Russian buyer has executed a non-binding memorandum of understanding (MOU), in which the volume of coal sales could increase to 30,000 tpm from Sukhbaatar. Any increase in coal volume would be subject to wagon availability and market conditions.
Prophecy previously exported coal to Russia in 2011 and 2012. The Ulaan Ovoo mine has been curtailed since July 2012. The company has not yet released the estimated capital expenditure it will cost to bring the mine back on line.
According to the company, the new agreements with the Russian buyer will help establish the long-term viability and stability of the mining and logistical operations at Ulaan Ovoo.
The buyer is thought to be based in Russia’s Buryatia region. This region in Russia, with a consumption rate of 6 million tpa of thermal coal, is currently facing a substantial coal shortage due to declining coal production.
Ageing local coal mines in the region have caused coal production in the area to decline. An un-interrupted supply of coal from Ulaan Ovoo through sustainable mining is therefore seen as essential to meeting growing regional demand for premium thermal coal.
Mongolian rail
Under the off-take agreements, 5000 tpm of coal will be exported through Northern Mongolia’s Sukhbaatar rail station, a major Mongolian gateway to Russia, which joins the Russian trans-Siberian railway.
Fresh coal deliveries via the Mongolian rail line are expected to commence in November 2013. This should coincide with the resumption of mining activities at Ulaan Ovoo, following the completion of pit-dewatering activities.
Prophecy has a coal stockyard and rail siding at Sukhbaatar, with a loading facilitiy capable of supporting up to 80,000 tpm of coal movement.
The company continues to work with Russian and Mongolian officials in re-opening the Zeltura crossing between the two countries, which is currently closed. The crossing lies 20 km from Ulaan Ovoo, meaning that if it were to reopen, the mine could further increase export sales volume.
One of Prophecy’s mining competitors in Mongolia, Aspire Mining, has also recently indicated coal from its Ovoot project could be exported to Russia. The company is looking at extending the 406 km of rail line that currently runs between Erdenet and Moron.
Non-binding MOU
The Russian buyer has executed a non-binding memorandum of understanding (MOU), in which the volume of coal sales could increase to 30,000 tpm from Sukhbaatar. Any increase in coal volume would be subject to wagon availability and market conditions.
Resumption of exports to Russia
Prophecy previously exported coal to Russia in 2011 and 2012. The Ulaan Ovoo mine has been curtailed since July 2012. The company has not yet released the estimated capital expenditure it will cost to bring the mine back on line.
According to the company, the new agreements with the Russian buyer will help establish the long-term viability and stability of the mining and logistical operations at Ulaan Ovoo.
Delays to coal production at Ovoot project, Mongolia
Australian mining firm Aspire Mining has delayed the start up of coal production from its Ovoot project in Mongolia.
The company announced that it has developed a cost saving strategy that will help maximise profits and minimise costs at the metallurgical coal mine.
The new plan hinges on the extension of the existing Trans-Mongolian railway being completed in one phase.
The extension, known as the Northern Rail Line, will be built by Aspire’s wholly owned subsidiary, Northern Railways, and is expected to be commiussioned in 2017.
At this point in time, Northern Railways remains in discussions with the Mongolian Government regarding permits.
The company hopes to extend the existing rail line, which spans approximately 406 km from Erdenet to Moron, by a further 222 km that would connect the Ovoot coal project with Erdenet.
Last month, test results confirmed coal from the Ovoot project could be blended with non-metallurgical coals from the state-owned project at Tavan Tolgoi to produce good quality metallurgical coal.
Aspire have marked the Sainshand Industrial Park as an “ideal site” for blending this coal. The industrial park could be accessed via the Erdenet-Ovoot rail line.
In a press release, Aspire said that construction of the rail extension would alleviate the need to built a sealed coal haul road and reduce capital expenditure by US$ 98 million.
The company provided an estimated time line of progression with the rail line.
The rescheduled estimated start of coal production from the Ovoot project represents a fundamental shift in Aspire’s development strategy. The company has identified the lowest capital intensive start up costs, by using contractors wherever possible.
Aspire initially estimated the capital necessary for the Ovoot project would be US$ 459 million, plus US$ 265 million for the mining fleet.
Sweeping changes to the projected costs mean that the revised figure for total mine capital expenditure is now US$ 144 million.
Ovoot is the second largest coal reserve in Mongolia, with an estimated total of 184 million t of metallurgical coal available over a mine life of 20 years.
Aspire plan to initially export 5 million tpa of coal, using the Erdenet-Ovoot railway, to mostly Chinese customers. The company ahs reported there are also several Russian investors interested in purchasing Ovoot coal.
The company hope to export 10 million tpa from 2020.
The company announced that it has developed a cost saving strategy that will help maximise profits and minimise costs at the metallurgical coal mine.
Vital rail infrastructure
The new plan hinges on the extension of the existing Trans-Mongolian railway being completed in one phase.
The extension, known as the Northern Rail Line, will be built by Aspire’s wholly owned subsidiary, Northern Railways, and is expected to be commiussioned in 2017.
At this point in time, Northern Railways remains in discussions with the Mongolian Government regarding permits.
The company hopes to extend the existing rail line, which spans approximately 406 km from Erdenet to Moron, by a further 222 km that would connect the Ovoot coal project with Erdenet.
Last month, test results confirmed coal from the Ovoot project could be blended with non-metallurgical coals from the state-owned project at Tavan Tolgoi to produce good quality metallurgical coal.
Aspire have marked the Sainshand Industrial Park as an “ideal site” for blending this coal. The industrial park could be accessed via the Erdenet-Ovoot rail line.
Time line
In a press release, Aspire said that construction of the rail extension would alleviate the need to built a sealed coal haul road and reduce capital expenditure by US$ 98 million.
The company provided an estimated time line of progression with the rail line.
- December 2013: Receive grant of rail concession from Mongolian Government for Erdenet-Ovoot railway.
- March 2014: Complete feasibility study for Erdenet-Ovoot railway.
- June 2014: Complete funding for development of railway, and commence railway earthworks and construction.
- 2017: Commissioning of both railway and Ovoot mine.
Cost saving strategy
The rescheduled estimated start of coal production from the Ovoot project represents a fundamental shift in Aspire’s development strategy. The company has identified the lowest capital intensive start up costs, by using contractors wherever possible.
Aspire initially estimated the capital necessary for the Ovoot project would be US$ 459 million, plus US$ 265 million for the mining fleet.
Sweeping changes to the projected costs mean that the revised figure for total mine capital expenditure is now US$ 144 million.
Ovoot is the second largest coal reserve in Mongolia, with an estimated total of 184 million t of metallurgical coal available over a mine life of 20 years.
Aspire plan to initially export 5 million tpa of coal, using the Erdenet-Ovoot railway, to mostly Chinese customers. The company ahs reported there are also several Russian investors interested in purchasing Ovoot coal.
The company hope to export 10 million tpa from 2020.
Blending Mongolian coal
The
results of test work carried out between Aspire Mining and an
independent Mongolian research group indicate that coal from Aspire’s
Ovoot coal project could be blended with non-metallurgical coals from
state-owned Tavan Tolgoi to produce a good quality metallurgical coal.
The test work found that coals from seams 0, 3 and 4 from the Tavan Tolgoi deposit that were blended with indicative metallurgical coal from Ovoot resulted in a good quality metallurgical coal with a Chinese classification of “Primary metallurgical Coal” or “1/3 metallurgical”.
Seam 0 is generally classified as thermal coal and samples from seams 3 and 4 were confirmed as oxidised coal with nil remaining metallurgical properties.
Samples from these seams were washed to bring ash levels down to a targeted 10% and then combine with Ovoot coal on a 50/50 basis.
Of particular importance is seam 0, which is classified as thermal or weakly metallurgical coal by both Tavan Tolgoi and the adjacent UHG Mine owned by Mongolian Mining Corporation.
Thermal coal makes up about 30% of Tavan Tolgoi coal reserves and the washed sample from seam 0 when analysed exhibited minimal metallurgical properties as expected.
Over the next 20 years significant quantities of thermal coal and oxidised coking coal will be mined from the Tavan Tolgoi. These are obvious blending partners for Ovoot Project coal due to their similar rank and vitrinite categories.
Tavan Tolgoi coals are low in sulphur whereas Ovoot Project metallurgical coal is high in caking and plastic properties necessary to produce coke.
The results of test work are potentially good news for the Mongolian coal industry. Aspire Mining managing director, David Paull, has said that the results will allow Mongolia “to establish a new large and long-term revenue stream for this blended coal, adding substantial value to the 100% Mongolian Government owned Tavan Tolgoi mine.”
Tavan Tolgoi is located in the South Gobi region of Mongolia and is one of the world’s largest deposits of metallurgical coal.
Aspire Mining have provisionally earmarked the Sainshand Industrial Park as an “ideal site” for blending Ovoot and Tavan Tolgoi coals. Coals from the Ovoot project could access the industrial park via the proposed Ovoot to Erdenet Railway and the existing Trans-Mongolian rail line. Blended coal could be sold south and east to China, or north into Russia along the planned Tavan Tolgoi sales routes.
The test work found that coals from seams 0, 3 and 4 from the Tavan Tolgoi deposit that were blended with indicative metallurgical coal from Ovoot resulted in a good quality metallurgical coal with a Chinese classification of “Primary metallurgical Coal” or “1/3 metallurgical”.
Seam 0 is generally classified as thermal coal and samples from seams 3 and 4 were confirmed as oxidised coal with nil remaining metallurgical properties.
Samples from these seams were washed to bring ash levels down to a targeted 10% and then combine with Ovoot coal on a 50/50 basis.
Of particular importance is seam 0, which is classified as thermal or weakly metallurgical coal by both Tavan Tolgoi and the adjacent UHG Mine owned by Mongolian Mining Corporation.
Thermal coal makes up about 30% of Tavan Tolgoi coal reserves and the washed sample from seam 0 when analysed exhibited minimal metallurgical properties as expected.
Over the next 20 years significant quantities of thermal coal and oxidised coking coal will be mined from the Tavan Tolgoi. These are obvious blending partners for Ovoot Project coal due to their similar rank and vitrinite categories.
Tavan Tolgoi coals are low in sulphur whereas Ovoot Project metallurgical coal is high in caking and plastic properties necessary to produce coke.
The results of test work are potentially good news for the Mongolian coal industry. Aspire Mining managing director, David Paull, has said that the results will allow Mongolia “to establish a new large and long-term revenue stream for this blended coal, adding substantial value to the 100% Mongolian Government owned Tavan Tolgoi mine.”
Tavan Tolgoi is located in the South Gobi region of Mongolia and is one of the world’s largest deposits of metallurgical coal.
Aspire Mining have provisionally earmarked the Sainshand Industrial Park as an “ideal site” for blending Ovoot and Tavan Tolgoi coals. Coals from the Ovoot project could access the industrial park via the proposed Ovoot to Erdenet Railway and the existing Trans-Mongolian rail line. Blended coal could be sold south and east to China, or north into Russia along the planned Tavan Tolgoi sales routes.
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