Coal explorer and aspiring coking coal producer Aspire Mining (ASX: AKM) has received an indirect boost as a result of macroeconomic developments within its operational area in northern Mongolia.
The developer of a key railway connection that’s crucial to Aspire’s chances of production success in Mongolia, Northern Railways LLC, hosted a senior delegation from Russia’s Tuva Republic during their official visit to Mongolia last week. The delegation included Mr Brockhurt, the Deputy Chairman of Tuva and Ms R Sambu-Ho, the director of foreign economic relations in the Tuva Republic.
The collaboration between Mongolia and Russia towards building a mutually beneficial infrastructure project is encouraging for Aspire Mining and improves its chances of entering production of coking coal at its respective Ovoot and Nuurstei projects.
The chairman of the Government of Tuva Republic, Mr Sholban Kara-Ool met with the Mongolian President Mr Battulga with both policymakers noting that the Northern Rail Corridor and its proposed rail connection up to the Tuvan capital of Kyzyl will “play a positive role in the economic development for both countries.”
Aspire Mining also reports that the parties signed a Memorandum of Understanding (MoU) which supports continued cooperation on seeing the Northern Rail Corridor completed to Kyzyl and to support transit freight volumes commencing in the region.
The Northern Rail Corridor is an important part of the Tuva Republic’s economic development plan which has the support from policymakers in all three of the provinces through which the railway will pass, including Russia’s Tuva region.
Mr Alexander Brokert, the Deputy Chairman of Government of Tuva Republic, said in an interview that the Russian Government is interested in the implementation of the Erdenet to Ovoot Railway Project which will boost trade and economic development between Russia and Mongolia.
Furthermore, collaboration is being supported at the highest levels of government and is “seen as an important step in growing and diversifying the local economy to boost exports and the local tourism industry,” according to Mr L Ganbold, the Governor of Mongolia’s Khuvsgul province.
Mr Ganbold said that the Citizens Representative body voted to support infrastructure projects including railway development and that “the Erdenet to Ovoot Railway is seen as one of the projects with the most potential to have a positive impact.”
Today’s news means that one of the most important features of Aspire’s ongoing project development in Mongolia (the Erdenet to Ovoot Railway) is on course to being built and is supported by all its stakeholders including local residents.
The news was also well received by investors, with Aspire Mining shares rising 5% up to $0.02 per share in early morning trade.
Commercialising coal in northern Mongolia
Aspire Mining currently holds several mining and exploration licences in Mongolia’s northern provinces and is focused on identifying, exploring and developing quality coking coal assets.
Its flagship asset is the Ovoot coking coal project which the company says is highly dependent on the construction of the Erdenet to Ovoot Railway which is being progressed by Northern Railways, a Mongolian rail infrastructure company, mandated to pursue the development of the Erdenet to Ovoot Railway, and supported by an international consortium consisting of Aspire Mining, and subsidiaries of Fortune 500-listed China Railway Construction Corporation ‑ China Railway 20 Bureau Group Corporation and China Railway First Survey & Design Institute Group.
Its other asset is the Nuurstei coking coal project which Aspire hopes to eventually connect into the railway export route but for the time being, is working towards an initial road-side production operation that’s currently being developed prior to the completion of the Erdenet to Ovoot Railway.