Aspire’s Ovoot Early Development Plan (OEDP) To Benefit Community

Mining had and always will have an impact on communities. History has shown duo relation, both positive and negative. Mining is often located in remote locations and it is one of the significant sources of pollutant to the inhabitant thriving in the vicinity. Hence it is quintessential for any mining company to properly layout the operational plan in such a way which doesn’t adversely affect the environment and at the same time develop the society and economy for the people. The proper engagement with communities aids the running of plant smoothly with appropriate trust and respect, and if not, it may end up having a strike, protest or even closure of the mine.

On similar line Aspire Mining Limited (ASX:AKM) has dedicated community relations team to work closely with the indigenous people to support improvement in education, environmental, health, economic and sustainable development. It is also worth mentioning that the Aspire’s Ovoot Coking Coal Project is aiming to develop educational, health and rehabilitation programme for the community residing near the project area, and they are: -

1. Four years with four scholarships annually- program is designed for Mongolian students to fund bachelor's degree in the field of Media and Science, building community relation via allowing gaining practical experience in the Company while completing their studies. This is the third scholarship program of a total of 12 scholarships already awarded starting 2012.

2. As a part of health programme, the Company also donated fund to complete a hospital at Tsetserleg and offers resident doctor serving the people-centred at the Ovoot Project, to Tsetserleg and Tsagaan Uul residents along with call facility for people unfit to travel.

3. Rehabilitation includes shifting to another area within Khuvsgul province having either equivalent or better condition for families falling under a certain radius of the project. The rehabilitated area must be selected keeping focus to animal grazing, and protection against adequate winter season.

One Question May Arise That How is Ovoot Coking Coal Project Benefitting the Community in Terms of Employment and Government Exchequer?

Ovoot Coking Coal Project wholly owned by AKM is presently looking toward the development of its Ovoot Early Development Project (OEDP). The early development program includes an open-pit mine, truck to transport washed coking coal of around 4Mtpa to its customer in Russia and China for which 560-kilometre road construction is planned from Erdenet rail terminal in Murun and then to the end market via rail.

Interesting Read: Aspire Mining’s Progress on Rail And Road Links For Ovoot Early Development Plan

The massive OEDP project is anticipated to create indirect new job creation of total 1200 headcount with a total investment of around US$275 million; also, OEDP workforce is likely to grow to the count of 450. Whereas, over ten years of project operation is projected to contribute around US$850 million as Taxes and Fees with US$33 million benefitting directly to the local community.

Ovoot Early Development Project (OEDP) Operational and Financial Estimates

The latest pre-feasibility study demonstrates the life of mine (LOM) of 12.5 years with a strip ratio of ~4.7Mt. The average coal mined per year is 4.6Mt with an average yield of 86% at 10% moisture. The fuel sold is anticipated to be ~4Mt at 2% net loss. The cash cost estimated to be US$76/t including Mining (US$26/t), Trucking (US$32/t) and Rail with Border charges (US$18/t).

From this project, the LOM EBITDA is likely to be around US$2.4 billion. The Pre-tax net present value at 10% factor is evaluated to be ~US$878 million with pre-tax IRR of 49.4% and payback of ~26 months.

Interested in OEDP Extended PFS, Please Click: Aspire Mining Announces Further Updates to the Re-Stated OEDP PFS Extended Case; Stock up 16.7%

Aspire Mining – Company Detail

A metallurgical coal explorer and developer Aspire Mining Limited wholly owns the world-class portfolio, i.e. Ovoot Coking Coal Project along with OEDP and rail and road infrastructure project in Mongolia.

Must Read: Aspire Mining’s Target Commodity Coking Coal and The Market Opportunity

The other assets of AKM apart from Ovoot are 90% owned Nuurstei Coking Coal and 80% owned Northern Railways LLC.

Recently, Mr Tserenpuntsag – a renowned well entrepreneur with strong bilateral political connections across all levels of Mongolia's government, secured 52.5% shareholding in the Company through a Placement worth A$33.5 million and options exercise of A$ 2.75 million.

Prefer Value Buying? Please Read: Aspire Mining: A Cash Backed Bargain

Stock Information

The stock closed at A$0.091 up by 4.6% on 4 March 2020.

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