Aspire subsidiary awarded concession for cross-country rail corridor

JOHANNESBURG (miningweekly.com) – ASX-listed metallurgical coal explorer and infrastructure company Aspire Mining’s subsidiary, Northern Railways, has been awarded a rail concession by the Mongolian government to build, operate and transfer a 547 km section of the newly agreed upon Northern Rail Corridor from Erdenet, in Mongolia, to Aspire’s Ovoot coking coal project, also in Mongolia.

This award followed the signing of a trilateral programme by the presidents of China, Russia and Mongolia, who agreed on the development of the economic corridor, which would run from China to Russia, across Mongolia. The presidents of the three countries met on the sidelines of the Shanghai Cooperation Organisation Annual Meeting, in Tashkent, Uzbekistan to discuss the programme.

The Northern Rail Corridor agreement identified a 3 500 km rail path connecting the seaport of Tianjin to the Trans-Siberian Railway, at Kuragino, in Russia. About 2 100 km of the rail corridor already exists.

Aspire said in a statement on Tuesday that the rail corridor required the completion of additional rail developments from Erdenet to Ovoot; to Arts Suuri, on the border of Mongolia and Russia; to Kyzyl, in Russia; and to Kuragino.

Each of these rail developments would be subject to identifying commercial feasibility. Two-way trade freight along the Northern Rail Corridor would provide long-term demand for fast and efficient rail freight services.

Aspire noted that the establishment of the corridor confirmed that the railway spanning from Erdenet to Ovoot had developed from being a rail connection to a large coking coal project, to now being part of a new trade infrastructure route.

The company added that the inclusion of the Erdenet to Ovoot railway enhanced the value-adding opportunity for Ovoot coking coal to be blended with Erdenet's Tavan Tolgoi noncoking coals.

“It is very significant news that the Erdenet to Ovoot railway is now recognised as a key part of a new rail trade route between Russia and China through Mongolia,” said Aspire MD David Paul, adding that the new corridor would be of significant long-term value to the people of Mongolia.

“The Erdenet to Ovoot railway has now officially moved from a rail extension to service a world-class coking coal deposit, to a strategic piece of rail infrastructure to facilitate China’s Silk Road Initiative and Mongolia’s Step Road trade initiative,” he added.

The Northern Rail Corridor also formed one of the six key rail and maritime economic corridors that formed the basis of China’s One Belt, One Road strategy to grow trade with its new neighbours in Asia and Europe.

Aspire noted that it was the only publically listed company with a significant interest in the new rail corridor. Northern Railways was 90% owned by Aspire and 10% owned by the Noble Group.