Haranga Resources locks in 5Mtpa of export rail capacity for Selenge iron ore
This deal is a major step in the development of the Selenge Project, where recent metallurgical results of the ore and the techno-economic assessment by ProMet Engineers delivered a base case net present value of over US$1 billion, with substantial upside potential.
The agreement was executed with both the Mongolian Railway Authority and the Mongolian Government Ministry for Road, Transportation, Construction and Urban Development.
Both bodies will support the allocation of up to 1 million tonnes per annum for export rail capacity for the Selenge Project once mining has begun, with the total 5 million tonnes per annum to be allocated from 2015 onwards.
As part of the agreement, Haranga will share Feasibility Study results on any proposed new rail infrastructure, including any rail track and loading/unloading facilities, to be constructed for Selenge.
In return, the Mongolian Railway Authority and the Mongolian Government Ministry for Road, Transportation, Construction and Urban Development will do their best to enable Haranga to obtain all the required licences and operating permits to build and operate any new rail infrastructure and facilities.
Selenge - located in major iron ore province
Haranga has defined an exploration target of 160 to 320 million tonnes for the Selenge Project, which is located in the heart of a premier iron ore province and has access to the main trans-Mongolian rail line and nearby rail spurs.
Selenge comprises four major iron ore prospects within 10 kilometres of each other, and is strategically located near to the 304 million tonne Eruu Gol mine, which currently exports over 3 million tonnes of magnetite concentrate per annum.
The company is prioritising its current drilling program to increase the Resource inventory from the current 32.8 million tonnes at 24.4% iron, based on initial drilling at Bayantsogt only.
An aggressive program is underway with nine drill rigs turning on the project. Drilling will continue through until December 2012.
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