In its Q1 2014 report, Guildford Coal said that, although it was pleased its BNU North coal mine in the South Gobi region of Mongolia had been formally commissioned by the Mongolian Government, development of the mine had since slowed.
In a statement, Guildford Coal said that mine development had continued during March, but had been reduced to only one mining excavator working in single day shifts.
This move came “in order to conserve cash” while the company waits for the commissioning of a vital haulage road that is necessary to transport coal from BNU North to customers and export terminals.
The company is trying to ensure coal can be taken to the Ceke Border Port on the Mongolian-Chinese border. This has been flagged as a key distribution hub by Guildford Coal and targeted as a main destination for its coal.
Guildford Coal did note that it had made considerable progress over the course of Q1 on its resource definition assessments.
Most of the company’s activities during Q1 focused on seeking further local government support for the BNU North project. The company resubmitted certain aspects of its Environmental Management Plan for approval and attended several meetings with the relevant departments of the central Mongolian Government.
Pursuant to an Option Agreement between Guildford Coal and the Noble Group, the company is finishing due diligence on a Mongolian exploration lease (No. 12,600), to help guide a decision on whether to exercise an option to operate or acquire the lease.
Guildford concluded that the lease was an exploration license, which lies adjacent to the BNU North mine. The company said this could result in operational synergies and would further reinforce the close working relationship established with Noble.
Written by Sam Dodson
Read the article online at: https://www.worldcoal.com/mining/08052014/development_slows_at_mongolian_coal_mine_815/