Aspire Mining Ltd (ASX:AKM) is an exploration and development company focused on discovering and developing world class premium coal deposits in Mongolia. Its Northern Railways subsidiary is developing the Erdenet to Ovoot rail project.
Aspire Mining Ltd (ASX:AKM) which is actively developing projects in Mongolia with stakes in both coal mining and railroad projects in the north of the country has announced it is working with China Railways Bureau 20 Group toward a debt facility to fund pre development rail activities.
Aspire's Mongolian rail infrastructure subsidiary, Northern Railways LLC is working with nominated EPC contractor and consortium partner China Railways Construction Bureau 20 Group source to source bridge funding from a Chinese bank.
The proposed funding is a line of credit to enable completion of all pre development activities required under the Erdenet to Ovoot Rail Concession Agreement.
The credit facility would allow the completion of a rail bankable feasibility study, environmental permitting and completion of a number of commercial agreements including the EPC and debt refinance.
The line of credit is intended to be supported by guarantees from Construction Contractors and Aspire.
Aspire’s managing director, David Paull said that “With the continued support of the Mongolian Government, CRCB20G and now with the support of UBTZ, the Erdenet to Ovoot to Arts Suuri railway continues to progress as a viable inclusion in Mongolia’s “Economic Corridor” between China and Russia.”
The Rail Project spans 547 kilometres and forms part of Mongolia’s Rail Policy to provide rail access to its northern provinces through the extension of its existing rail network from Erdenet to Ovoot to the Russian/Mongolian border at Arts Suuri with a Russian connection planned to Kyzyl.
At full operation, the Rail Project will have capacity to move 30 million tonnes per annum of bulk commodities, agricultural, general and passenger freight including transit freight between Russia and China.
Working group has Noble ambitions
Aspire has agreed with Mongolia’s Ulaanbaatar Railway Corporation (UBTZ) to establish a working group to work through the technical and commercial issues in connecting the Erdenet to Ovoot Railway onto the existing Mongolian rail network operated by UBTZ and the operational management of the Northern Railway.
UBTZ is a joint venture between Mongolia and Russia and operates the domestic Mongolian Rail network.
UBTZ and Northern Railways are to agree access, capacity and future rail tariff structures along Mongolia’s existing rail network.
Noble Group continues to be part of the Northern Rail consortium and welcomes the participation of new partners. Noble has agreed to revised terms on the existing loan with Aspire to allow the partnership time to complete its 24 month rail development process.
Aspire’s projects include the Ovoot metallurgical coal project and the Ekhgoviin-Chuluu joint venture with Noble Group (which owns a 90% stake in the Nuurstei metallurgical coal project).
Aspire also owns Northern Railways, which aims to connect Ovoot to the country’s national rail network and then onto Russia’s Trans-Siberian Railway.
Upon completion, the line will increase Mongolia’s access to Russian, Chinese and seaborne metallurgical coal markets.
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