SouthGobi Resources Ltd. (TSE:SGQ) said Tuesday that construction has started on a new paved coal highway to the Mongolia-China border.
A
ribbon-cutting ceremony was held June 16 to commemorate the start of
construction. The paved highway will have an intended carrying capacity
upon completion in excess of 20 million tonnes of coal per year.
"The
new paved coal highway will significantly increase the safety of coal
transportation to the border, reduce dust, and improve efficiency and
capacity of coal transportation," SouthGobi's president and CEO
Alexander Molyneux said.
In August 2011, the State Property
Committee of Mongolia awarded the tender to construct a paved highway
from the Ovoot Tolgoi Complex to the Shivee Khuren Border Crossing to
consortium partners NTB LLC and SouthGobi Sands LLC, a wholly-owned
subsidiary of SouthGobi Resources (together referred to as RDCC).
On October 26, 2011, RDCC signed the concession agreement with the State Property Committee of Mongolia.
RDCC now has concluded a 15-year build, operate and transfer agreement under the Mongolian Law on Concessions.
SouthGobi Resources
is focused on exploration and development of its Permian-age
metallurgical and thermal coal deposits in Mongolia's South Gobi Region.
The company's flagship coal mine, Ovoot Tolgoi, is producing
and selling coal to customers in China. The company plans to supply a
wide range of coal products to markets in Asia.
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