By: Esmarie Swanepoel
6th December 2012
PERTH (Mining Weekly) - A review of the prefeasibility study (PFS) into the Ovoot coking coal project has confirmed that the project could be one of the lowest cost potential sources of coal into China, coal developer Aspire Mining said.
The PFS review confirmed the project’s economics, with a net present value of $1.7-billion and a life-of-mine net cash surplus, after taxes and capital, of $8.3-billion, based on a medium-term average coking coal price of $200/t.
The revision was based on a large openpit mine delivering up to 14-million tons a year, and a small underground mine delivering some 0.75-million tons a year, over a 20-year life of mine.
“I am pleased to be able to report that the PFS revision has demonstrated that the Ovoot project is one of the lowest cost potential sources of coal into China, which is the world’s largest consumer of coking coal and coke,” said Aspire MD David Paull.
Life-of-mine costs, excluding gate costs, was currently estimated at A$36/t of coking coal, with free-on-rail cost into China forecasted at A$91/t for the first five years of full production.
The review included a recently announced increase in the probable coal reserves at the Ovoot project, which now stood at 2019-million tons run-of-mine, making Ovoot the second largest coking coal deposit on Mongolia, by reserves.
“The 23% increase in coal reserves announced in November has contributed to the significant increase in the project’s net present value and overall cash surplus,” said Paull.
Aspire has identified an initial capital cost of $723-million to establish a coal handling plant, wash plant, a mobile fleet, waste pre-stripping, a coal haulage road and all of the necessary support infrastructure to produce six-million tons a year of saleable coking coal.
A further $482-million, along with contingencies, would be required to increase the project’s capacity to mine and process up to 14-million tons a year of coal, and to produce up to 12-million tons a year of product.
It was anticipated that the project would be able to fund the expansion from the initial six-million tons a year production rate to the full 12-million tons a year, along with all future capital requirements, from internal cash flow and project debt.
Paull said on Thursday that the company was now well positioned to start commercial negotiations to advance funding and project development.
Edited by: Creamer Media Reporter
6th December 2012
PERTH (Mining Weekly) - A review of the prefeasibility study (PFS) into the Ovoot coking coal project has confirmed that the project could be one of the lowest cost potential sources of coal into China, coal developer Aspire Mining said.
The PFS review confirmed the project’s economics, with a net present value of $1.7-billion and a life-of-mine net cash surplus, after taxes and capital, of $8.3-billion, based on a medium-term average coking coal price of $200/t.
The revision was based on a large openpit mine delivering up to 14-million tons a year, and a small underground mine delivering some 0.75-million tons a year, over a 20-year life of mine.
“I am pleased to be able to report that the PFS revision has demonstrated that the Ovoot project is one of the lowest cost potential sources of coal into China, which is the world’s largest consumer of coking coal and coke,” said Aspire MD David Paull.
Life-of-mine costs, excluding gate costs, was currently estimated at A$36/t of coking coal, with free-on-rail cost into China forecasted at A$91/t for the first five years of full production.
The review included a recently announced increase in the probable coal reserves at the Ovoot project, which now stood at 2019-million tons run-of-mine, making Ovoot the second largest coking coal deposit on Mongolia, by reserves.
“The 23% increase in coal reserves announced in November has contributed to the significant increase in the project’s net present value and overall cash surplus,” said Paull.
Aspire has identified an initial capital cost of $723-million to establish a coal handling plant, wash plant, a mobile fleet, waste pre-stripping, a coal haulage road and all of the necessary support infrastructure to produce six-million tons a year of saleable coking coal.
A further $482-million, along with contingencies, would be required to increase the project’s capacity to mine and process up to 14-million tons a year of coal, and to produce up to 12-million tons a year of product.
It was anticipated that the project would be able to fund the expansion from the initial six-million tons a year production rate to the full 12-million tons a year, along with all future capital requirements, from internal cash flow and project debt.
Paull said on Thursday that the company was now well positioned to start commercial negotiations to advance funding and project development.
Edited by: Creamer Media Reporter
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