Could you introduce Aspire Mining?

Aspire is an ASX-listed company. Two-thirds of the company shares are held by strategic investors, including more than half by Mongolian citizens. It has been active in Mongolia since 2010, working on the discovery and development of coking coal projects. The company holds 100% of the Ovoot Coking Coal Project (OCCP), and 90% of the Nuurstei Coking Coal Project (NCCP), both located in Khuvsgul aimag in the northwest of Mongolia. Current focus is upon advancing the OCCP, which contains a large deposit of coal categorized as a ‘fat’ coking coal in China. This is a premium type of coking coal used to enable incorporation of lower grade and cheaper coals in the production of firstclass coke. This coal is recognised similarly in Russian and other markets also. Could you brief us on the updated development plan for Ovoot?

The original Pre-Feasibility Study completed on the OCCP forecast a very large mine, requiring high capital investment, including for railway development. Public concern regarding the large scale mine and railway delayed project development. In 2017-2018, the company re-strategized, with an ‘Ovoot Early Development Plan’ (OEDP) forecasting an initially smaller scale mine and truck haulage across a road to be constructed that could also be used by the community. Following appointment of new management in 2019-20, the OEDP has been refined further to address remaining community concerns about environmental protection and local development. The refined plan incorporates responsible practices that will benefit all stakeholders. Following completion of infill exploration drilling in Q4 2022, refinement of the JORC Coal Resource and Coal Reserve estimates are underway. An Independent Technical Report is expected to be released in the first half of 2024, to support raising finance for infrastructure construction. Could you elaborate on the operational environment in Khuvsgul Aimag?

Adjacent to the OCCP is a small coal mine operated by Mogoin Gol JSC, a company listed on the Mongolian Stock Exchange. Operating since the early 1970s, this mine has recently been producing about 100,000 t/y. The people living in Khuvsgul are concerned about the potential impact of coal mining on their environment. This is understandable given that public perceptions have been shaped by examples of negative impact from some irresponsible mine operators in Mongolia. The public has had little exposure to responsible mining operations. Aspire is committed to ensuring that our mine does not negatively impact the Khuvsgul environment, and will have positive impact on the local community. What’s your financial strategy and how do you assess investment sentiment in coal mining?

Aspire is targeting debt financing to develop the OCCP, to avoid dilution of existing shareholders. Recently, debt financing of coal projects has become challenging, however, there remain institutions with appetite to invest in coal projects. These are generally those that can distinguish between coking and thermal coals. What are the current demand-supply dynamics and how do these reflect on coal pricing?

Global economic stimulus efforts post-COVID have prompted infrastructure development, demand for steel, and thus coking coal. Strong prices have resulted. Mongolian coal export to China has grown, benefitting from diplomatic tension between China and Australia, and Mongolia now supplies more than half of all coking coal imported into China. Demand is also strong due to global supply constraints, which is related to lack of investment in developing production capacity. This presents opportunity for Mongolia and the OCCP. What has been your experience of working in Mongolia?

I have enjoyed working in Mongolia the past 14 years. It is exciting to be working on projects bringing benefits and opportunities to so many people. It is important as a foreign investor to have a good local partner to navigate the challenges that rapid development presents. I feel sometimes that the international media picks up on issues affecting foreign investors in a one-sided manner. However, my experience has been that with the right team, Mongolia is a good place to do business. What are Aspire Mining’s main objectives for 2024?

2024 is an important year for Aspire. We now have the right plan and the right team to bring the OCCP into production. Tangible progress was made in 2023, and we are committed to delivering this project for the benefit of all stakeholders. We anticipate obtaining major approvals necessary to advance the OCCP, securing project financing, and commencing construction.