Suspended since July 2012, the Ulaan Ovoo thermal coal project in northeastern Mongolia is up and running again.
Prophecy Coal TSX:PCY, the Canadian company that owns the mine, announced on November 1 that it has re-hired all the required staff and that with a fleet of excavators and dump trucks, production should reach up to 50,000 tonnes per month until the end of the year.
The $55-million project was temporarily suspended last year because the stockpile of coal was enough to meet the company’s contractual obligations for the year. Following the suspension, the company said it was in active discussions with potential customers to increase sales.
Earlier this month, the company announced a sales contract with a new customer for 30,000 tonnes of coal. The first shipment is planned for November.
Ulaan Ovoo is located 17 kilometres from the Russian border and 120 kilometres from Mongolian and Russian rail links. Customers include both Russian and Mongolian companies, as well as the Mongolian government-owned power plants.
Prophecy Coal gained nearly 17% on the Toronto exchange on November 4, trading at 11 cents per share.
Reprinted by permission of MINING.com