Mongolian coal developer, Aspire Mining Ltd has announced the Ovoot Early Development Plan (OEDP) and related funding commitments. The OEDP will involve mining a low ash and high yielding coal from a starter pit that sits within the previously defined Ovoot orebody and construction of a new private haul road beside the planned 547 km rail path for the Erdenet to Ovoot Railway.

In support of the OEDP, Aspire is delighted to confirm it has executed definitive and binding documentation with existing substantial shareholder, Tserenpuntsag Tserendamba, to invest A$10 million as part of a A$15.0 million strategic financing package. Under the Agreements, Tserenpuntsag has agreed to subscribe for 476.2 million new ordinary Aspire shares at A$0.021 per share which on completion will take his holding from 16.6% to approximately 27.4% in Aspire.

• Targeting material early production of washed coking coal via a truck and rail operation to end markets within 12 to 15 months of approval
• Rail service road identified in Erdenet to Ovoot feasibility study proposed to be developed into temporary haul road until commissioning of the Erdenet to Ovoot Railway
• Post the financing, Aspire will be debt free with an additional A$11.7 million in cash sufficient to fully fund Ovoot’s pre-development capital
• Further operational expansion of the world class Ovoot coking coal project to follow upon completion of the Erdenet to Ovoot Railway.

Aspire has identified a low ash high yielding open pit section of the Ovoot orebody which is expected to be well suited to form the basis of the starter pit for the OEDP. The designed production rate at Ovoot under the OEDP will be matched to forecast logistics capacities which are limited by existing Mongolian rail capacity and expected to be in the range of 3 to 4 Mt/y from work undertaken during the Nuurstei feasibility study.

David Paull, Aspire’s Executive Chairman stated: “This is a very important step in realising the large inherent value of the world class Ovoot coking coal project. We are delighted to have secured the substantial support of Mr. Tserenpuntsag who has recognised the deep value that the company represents. Aspire has always recognised the need to have strong Mongolian support and ownership as it progresses the development of the Ovoot project and the Northern Railway. In this way there is a strong alignment between Mongolian and international investors.”

The Ovoot PFS delivered in December 2012 confirmed that Ovoot can deliver up to 10 Mt/y of washed high quality “fat” coking coal over a 20+ year mine life once rail is connected to the project. The delivered washed coal will offer significant “value in use” benefits to customers including an ability to upgrade non-coking coals in a blend.

The picture shows the planned final pit and infrastructure layout – Ovoot open pit and underground