Terra Energy secures new mining licence from Mongolia

15 September 2015 (Last Updated September 15th, 2015 18:30)

Guildford Coal's Mongolian subsidiary Terra Energy has secured the mining licence Khar Servegen (KS) MV-019149 from the Minerals Resource Authority of Mongolia (MRAM).

Licence

Guildford Coal's Mongolian subsidiary Terra Energy has secured the mining licence Khar Servegen (KS) MV-019149 from the Minerals Resource Authority of Mongolia (MRAM).

Valid for 30 years until 8 September 2045, the new mining licence can be extended up to two additional terms of 20 years each.

Terra Energy stated that the licence covering part of the previous highly prospective 12600X exploration licence plays a vital role in Guildford's expansion plans for coking coal operations in South Gobi.

The exploration licence MV-019149 adds to the company's earlier announced mine expansion plans, covering 6,664ha of the Noyon Coal basin, with 43,270ha remaining as exploration licence 12600X.

Terra Energy estimates that it will be able to achieve two million tonnes in 2016, three million tonnes in 2017, and reach target a sustainable five million tonnes by 2020 through expanding its existing operations.

"Terra Energy estimates that it will be able to reach target a sustainable five million tonnes by 2020 through expanding its existing operations."

The company also plans to develop satellite pits in existing licences, including MV-019149.

Adjoining Guildford mining licence MV-017162, the mining licence KS MV- 019149 includes the western part of the Noyon Basin with an estimated 50km of basin edge shallow coal bearing stratigraphy.

The MV-017162 mining licence includes the Baruun Noyon Uul (BNU) coking coal mine, which has an existing output capacity of 1.2 million tonnes per annum.

The addition of this licence allows for mining of basin-edge near-surface coal bearing stratigraphy, while the majority of the Noyon Basin will be held within Guildford mining licences.

Mining at Khar Servegen MV-019149 is expected to begin in 2016.


Image: The Khar Servegen MV- 019149 licence covers part of the previous highly prospective 12600X exploration licence. Photo: courtesy of Guildford Coal Limited.