Aspire Mining signs MoU with Ulaanbaatar Railways JSC, gaining access to rail network

Aspire Mining Limited has signed a memorandum of understanding (MoU) with Ulaanbaatar Railways JSC (UBTZ) to speed up the commercialization of the Erdenet to Ovoot railway.

Mongolian metallurgical coal explorer and infrastructure company, Aspire Mining, signed the MoU through its subsidiary Northern Railways LLC, which in 2015 was granted an exclusive 30-year concession by the government to build and operate the Erdenet to Ovoot railway.

The signing occurred during a conference in Ulaanbaater sponsored by UBTZ focusing on developments that will see substantial freight volume growth through to 2030.

The company announced that it received the first stage feasibility study from China Railway First Survey and Design Institute Group on January 9. The study confirmed that the Erdenet to Ovoot railway is financially and technically feasible.

The MoU signed with UBTZ aimed to progress a number of key commercial requirements for supporting the funding of the Erdenet to Ovoot railway. Through the agreement, UBTZ will grant access to the national line to move freight across Mongolia, south to China, and north to Russia.

The access would “encompass a capacity nomination regime and long-term tariff structures. It is expected that the Erdenet to Ovoot railway users will become the largest users of UBTZ rail services over time,” stated Aspire Mining on its website.

Future commercial agreement are planned to be made in conjunction with UBTZ’s traffic management and line maintenance capabilities as well as on the cooperation on the rehabilitation of the Erdenet to Salkhit spur line that connects onto the main line. The Erdenet to Salkhit is a 164 km line that has limited capacity to absorb the substantially higher capacity that will be required to service the Erdenet to Ovoot railway users and will require significant rehabilitation over time, according to Aspire.

Aspire’s managing director, David Paull, said, “A close working relationship between Northern Railways and UBTZ will be essential for the successful development of the Northern Rail Corridor which will add significant longterm demand for UBTZ’s rail services.”