Aspire Mining has entered into a strategic marketing and logistics alliance agreement with a wholly-owned subsidiary of Noble Group to assist with the development of the world-class Ovoot Coking Coal Project in northern Mongolia.
Noble, which owns 8.3% of Aspire, is one of the world’s largest commodity trading and logistics companies and moves coal into most major global markets. It has significant experience in developing integrated supply chain platforms and will work with Aspire to utilize Noble's strategic alliances and relationships within Russia and China.
The agreement between Aspire and Noble focuses on:
- Investigating supply chain logistics to transport coking coal from Ovoot to customers in China, north Asia and other seaborne coking coal markets which can be accessed via far eastern Russian and Chinese export ports.
- The establishment of the ‘Ovoot’ coking coal brand in the global marketplace, and identifying opportunities to develop value added products.
- Reviewing opportunities for value added products and processes in relation to Ovoot.
- Identifying strategic partners to assist with logistics support including access to rail and port facilities, and assist with funding for the development of the Ovoot Coking Coal Project including the construction of the rail link from Ovoot to Erdenet.
- Supporting Aspire’s subsidiary, Northern Railways LLC, in securing licences in respect to developing the proposed rail link between Ovoot and the rail link at Erdenet, Mongolia.
Under the Agreement, Noble will market at least 50% of the first 5 million tonnes of saleable coking coal produced from Ovoot and will manage the logistics chains between Erdenet and end customers in respect of these sales. Noble will be entitled to purchase up to 33% of its marketing allocation as principal. In return, Aspire will pay a marketing fee and separate logistics management fees to Noble on normal commercial terms.
Noble’s rights to market Ovoot coal are conditional on the establishment of suitable logistics access to customers in China and the seaborne markets. Being able to demonstrate access to seaborne markets is an important component of de-risking the development of the rail connection and the larger development of the Ovoot Project.
Aspire’s managing director Mr David Paull says, “The strategic alliance with the Noble Group is an important step for the company as it pushes ahead with development of the Ovoot Coking Coal Project. As a key shareholder, Noble has long recognized the strategic significance of the Ovoot Project.
“This alliance cements our relationship with Noble and we look forward to working closely to de-risk Ovoot’s development path. In particular, the alliance provides a framework to confirm access and cost of various supply chains to customers in the seaborne market as well as completing the important groundwork required to appropriately brand Ovoot coking coal as a high value feedstock for coke plants globally.”
Aspire owns 100% of the Ovoot Coking Coal Project in northern Mongolia which, in 2010, announced a maiden 330 million tonne resource. Aspire is targeting resource upgrades at Ovoot, as well as progressing development of key infrastructure including access to rail.