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Aspire Mining focused on completing DFS for early Ovoot coal production plan

At June 30, 2019, the Aspire Group had $11.1 million cash at bank with no borrowings.

Coal being stockpiled
The company has two coking coal projects in northern Mongolia

Aspire Mining Ltd (ASX:AKM) is focused on completing a definitive feasibility study (DFS) for early development of the Ovoot Coking Coal Project in northern Mongolia.

The company is aiming to have the Ovoot Early Development Project (OEDP) DFS completed before the end of 2019.

Staged waste removal strategy proposed

During the June quarter Aspire reassessed the first five years of the OEDP pre-feasibility study mine plan and has identified a proposed staged waste removal strategy.

This is expected to result in a significantly shorter pre-strip period of seven months, down from 12 months, to deliver 4.1 million tonnes of coal production in the first two years.

The proposed strategy will be assessed as part of the ongoing OEDP DFS.

This proposed new mine plan defers a significant amount of waste removal from years 1 and 2 into years 3 and later, resulting in a reduction in the cost of the pre strip.

It is expected to have a positive impact on the net present value of the OEDP with total open pit volumes remaining the same.

Results of the PFS Extended Case produced a pre-tax NPV, at 10%, of US$758 million and a pre-tax IRR of 44.5%.

READ: Aspire Mining obtains approval from Mongolian Reserve Council for total Ovoot reserves in Mongolia

The company wholly owns 100% of the large-scale, world-class Ovoot project and a 90% interest in the Nuurstei Coking Coal Project, both in northern Mongolia.

Aspire recently obtained additional regional geological data which looks to support a structural reinterpretation of the various seams at Ovoot, which would see reallocation of resource tonnages between the Lower and Upper Seams.

This could affect the open pit design and could potentially add mine life to the OEDP Open Pit Extended Case.

Geotechnical and hydrological drilling is required to bring the OEDP Extended Case up to DFS status.

Community engagement

Aspire continues to engage with local community leadership regarding mining and road approvals.

The communities have tied further on-site work to negotiations for a community benefits agreement which can be progressed now that the Ovoot Feasibility Study updated for the OEDP has been approved by Mongolian Mineral Reserve Council

A study has also started, in association with Xstract Mining Consultants Pty Ltd, to look at underground mining extensions post completion of the OEDP pit extensions.

This is initially at a concept study level and will be based on continuing with the road-based transport of washed coking coal to Erdenet.

READ: Aspire Mining releases positive early development PFS as markets absorb high-profile coal takeover bid

During the quarter the company also carried out:

  • Analysis of an indicative bulk sample for Ovoot coking coal that confirms excellent washability characteristics and the opportunity to produce a low ash product;
  • Cooperation agreement with Mongolian rail operator Ulaanbaatar Tumer Zam Joint Venture Stock Company (UBTZ) that guarantees rail capacity for all OEDP coal transport; and
  • Commenced the process to identify potential strategic funding partners to assist with debt and equity funding.

Quick facts: Aspire Mining Ltd

Price: 0.013 AUD

ASX:AKM
Market: ASX
Market Cap: $43.25 m
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Aspire Mining PFS shows 'fantastic financial outcome' with further optionality

Aspire Mining Ltd (ASX:AKM) managing director David Paull talks Proactive Investors through the outcomes of a Pre Feasibility Study on the Ovoot Early Development Project. The company is seeking the near-term production of coking coal from the Mongolian asset, to feed Chinese...

on 1/3/19

3 min read