For its first major foray into Mongolia, Noble has chosen to forge a strategic alliance with ASX-listed, Perth-based Aspire Mining which is developing its flagship project, the Ovoot coking coal project, in northern Mongolia.
Part of the alliance agreement is a commitment on Noble’s part to lift its stake in Aspire from 10% to 15%, making it one of the largest single shareholders.
The Ovoot project is ranked as the second largest high quality coking coal reserve in Mongolia and in its December quarterly report Aspire announced an updated coal resources statement.
The upgrade was prepared by the company’s independent geological consultants, Xstract Mining, and lifted Ovoot’s total probable reserves by 41Mt, or 23%, to 219Mt of ROM coal at 2% moisture on an as received basis (ARB).
With the inclusion of the updated coal reserves, the project now has a 20 year life of mine (LOM) while an underground mining study by Xstract found an additional maiden probable reserve of 8Mt of ROM coal. This would allow an underground operation to produce up to 750ktpa over an 11-year LOM.
Based on the increased marketable coking coal reserve, Aspire’s Ovoot project now sits comfortably among the coking coal assets of the major tier one coking coal resource companies.
Noble’s alliance agreement is a comprehensive package of initiatives covering every aspect of the mine’s development, by providing access to rail and port capacity, initial mine and rail pre-development funding and coal marketing.
For example the agreement commits Noble to giving support to a northern railways plan to extend the trans-Mongolian railway from Erdenet through to the Ovoot Project.
Aspire’s MD David Paull noted the package demonstrates the company’s excellent working relationship with the Noble Group as well as Noble’s commitment to the successful development of Ovoot.
“Apart from assisting in financing the northern railways project Noble plans to introduce strategic infrastructure partners as well as consider opportunities to connect this new rail line to various railway lines in Mongolia, China and Russia,” he said.
“Since Noble has recently acquired an interest in a Russian Far East port with significant expansion potential, Aspire has agreed to extend the scope of its alliance agreement.