A high level review of mining costs for Aspire Mining’s Ovoot Coking Coal Project in northern Mongolia has resulted in a 22% decrease in mine operating cost estimates.
The review was completed by Aspire in order to recognise the substantial deflation that is occurring in the resources sector.
The Ovoot cost estimates were initially completed for the 2012 revised pre-feasibility study when all cost inputs were derived during boom conditions in the resources industry globally.
The review was conducted to reflect the current market costs, which over the last three years have seen significant cost deflation as a result of a number of factors including foreign exchange movements, labour rates and other input costs.
The new cost estimated confirm the expectation that Ovoot remains at the lower end of the global cost curve on a FOR China basis.
Meantime, Aspire has received a report following the completion of a geophysical gravity survey conducted over the Ovoot tenements and surrounding areas by AMO-Discover LLC, a Mongolian firm. The survey was completed to explore the internal structure of the coal-bearing depressions and confirm the results of a survey completed during 2014 identifying exploration potential to the east of the existing Ovoot coal reserve.
The geophysical report identified two areas of interest which have been recommended for further surveying and drilling. These mid-potential and high-potential areas surround the existing Ovoot mining licence to the southwest and within existing exploration licences. Results of the report are positive and confirm the substantial potential to increase the existing coal resources and reserves at Ovoot.
The studies have also confirmed the areas of limited further exploration potential across the Ovoot Basin. Aspire is now in the process of relinquishing a further 17,000 hectares of exploration ground at Ovoot which will reduce the tenement position to approximately 25,000 hectares over the next couple of months.