PERTH (miningweekly.com) – Initial feasibility studies into the Erdenet to Ovoot railway, in Mongolia, have determined the project to be feasible, ASX-listed Aspire Mining has reported.
The company told shareholders on Monday that the railway servicing the proposed Ovoot coking coal project would require a capital injection of $1.25-billion for a 20-million-tonne-a-year single-line.
This is compared with the $1.2-billion cost for a 12-million-tonne-a-year line estimated in a 2013 prefeasibility study.
The freight forecast for the Erdenet to Ovoot railway does not include additional freight volumes from Russia’s Elegest coking coal basin or any trans-Eurasian trade, with Aspire noting that the feasibility of rail links into Russia would require further feasibility studies.
The feasibility study included two locomotive service centres and depots, as well as 11 bypass loops for the single-line track to be able to provide network capacity of 20-million tonnes a year.
There is also a total length of 10 km of tunnels across seven separate tunnel areas.
The entire rail line is expected to take about 60 months to construct; however, Aspire noted that there was an opportunity to truck coal from Ovoot to a loading point prior to the full completion and commissioning of the rail line, subject to pricing and cost.
The Erdenet to Ovoot railway is a critical component of the development of the Ovoot coking coal project, which hosts 255-million tonnes of coal reserve and can sustain production of 10-million tonnes a year over 21 years.