Shares in Aspire Mining have surged after it struck several transactions with commodities trader Noble Group over the Ovoot coking coal project in Mongolia.
Both parties have agreed to extend the strategic alliance that was first agreed to in November last year, with Noble to provide further services in return for an increased stake and board representation at Aspire and investments in the latter’s subsidiaries relating to Ovoot.
Shares in Subiaco-based Aspire closed up 2.3c, or 39 per cent, to 8.2c today.
Noble has agreed to acquire marketing rights over an additional 10 per cent of all coal produced at Ovoot for 20 years, an increase on the original 50 per cent.
Aspire said Noble will also enter into good faith negotiations to provide working capital facilities to support a 75,000 tonne per month initial development at Ovoot.
Aspire plans to start production at Ovoot in early 2016 as an initial 6 million tonne per annum (mtpa) operation, before ramping up to stage two which will see 12mtpa of coking coal produced over a 20 year mine life.
The commodities trader has also committed to fund 10 per cent of the pre-development capital of Northern Railways, Aspire’s rail infrastructure subsidiary, in return for an option to acquire 10 per cent of the issued capital.
As part of the Northern Railways transaction, Noble has agreed to provide a two-year $US5 million unsecured loan to fund pre-development costs.
Noble has also committed to subscribe to 35 million shares at 8c each, which will inject $2.8 million into Aspire. The placement will see Noble’s shareholding increase from 10.1 per cent to 14.9 per cent.
The agreements between Aspire and Noble will require shareholder approval, with a meeting to be organised shortly.
