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Move over ESG. Aspire Mining (ASX:AKM), developing its Mongolian-based Ovoot Coking Coal Project (OCCP), has received a tip of partial state support as the Khürelsükh government has agreed to build a major highway that intersects with a haulage road attached to the OCCP.
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Called the Murun-Uliastai, the highway comes to the fore as part of a Public-Private Partnership Agreement (PPPA) in which Aspire was the major private entity supporting. A tender agreement is expected to be completed in the next six months.
“Aspire is well-positioned to support a bid, backed by completed studies, regulatory approvals, and strong economic rationale,” the company wrote on Friday.
Whether it gets the bid remains to be seen, but the company perceives the highway will ultimately de-risk the project when it comes to logistics. But with gov’t support comes partial funding, potentially lowering Aspire’s CapEx load.
Notably, a sort of contract protects the highway for at least 23 years when it comes to Aspire’s overall involvement, or the operation of the OCCP. For that reason, Aspire likely wishes to be the selected bidder. In preparation for that end, Aspire has “appointed an international investment banking adviser to arrange project financing for the Special Purpose Vehicle (SPV) company to be established to implement the project.”
“Cabinet endorsement of the Murun-Uliastai Highway is a major milestone for Aspire and Mongolia. With approvals, feasibility studies and community consultation complete, we are ready to support delivery of this critical infrastructure, which will benefit both local communities and Aspire’s Ovoot Project,” Aspire CEO Sam Bowles said.
AKM last traded at 26cps.
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