SouthGobi Resources has extended the closing date of the sale of its Tsagaan Tolgoi coal deposit to Modun Resources to December 31, 2012. Last month the Mineral Resource Authority of Mongolia requested the suspension of some of the company’s mining and exploration licences. SouthGobi says the extended closing date will allow enough time to resolve these issues.
The 36.4 million tonne Tsagaan Tolgoi, or ‘White Hill’, deposit is in southern Mongolia and is the company’s second to confirm a NI 43-101 resource estimate. It is 415km northeast of the flagship Ovoot Tolgoi mine.
SouthGobi says the deposit has the potential to supply any future coal-fired power plant that may be developed to produce electricity for Ivanhoe Mines’ planned Oyu Tolgoi copper-gold mining complex, which is about 115km to the northeast of Tsagaan Tolgoi.
Coal at Tsagaan Tolgoi is found in a steeply dipping sedimentary basin located on two contiguous exploration licences covering 8820 hectares. The coal rank is high volatile B and C bituminous. Eight main coal seams with multiple subseams have been found at Tsagaan Tolgoi. To date, 86 reverse circulation and rotary holes as well as 28 core holes have been drilled on the property, with additional resource potential existing along strike and at depth.