The Erdenet to Ovoot Railway extends 549 kilometres between the town of Erdenet and Aspire’s Ovoot Coking Coal Project, both in Mongolia.
Having delivered the draft Erdenet to Ovoot rail feasibility study in March 2018, CGGC and Northern Railways have agreed to work quickly to finalise the feasibility study within May 2018.
The rail feasibility is a key document for targeting project financing.
CGGC will look to fund the remaining Erdenet to Ovoot Rail concession agreement pre-development work as per the previous October 2017 MoU.
However, this will be subject to receiving a guarantee that the connecting rail line will have sufficient capacity to carry the additional freight once connected.
Also, that there be sufficient time to complete the remaining pre-development work and conditions precedent pursuant to the rail concession agreement.
Northern Rail will enter into an EPC contract with CGGC in November 2018 subject to construction funding being available.
Mongolian prime minister’s visit
The new MoU was signed as part of the Mongolian prime minister’s official visit to China.
This was an important official visit being the first for the current Mongolian prime minister, Ukhnaa Khuretsukh.
In August 2015, Northern Railways was granted an exclusive 30 years concession by the Mongolian government to build and operate the Erdenet to Ovoot Railway.