Cabinet of the Government of Mongolia authorised on 10 August 2015 the Mongolian Government’s Investment Agency to execute the Concession Agreement with Aspire’s subsidiary Northern Railways LLC to build and operate the Erdenet – Ovoot railway in northern Mongolia.
The Concession Agreement is for a period of 30 years with 100% of the base railway structure to be transferred to the Government at the end of the concession term. The Concession Agreement will be executed by the parties as soon as logistically possible following final edits to be incorporated into the agreement.
Northern Railways will have the exclusive right to build and operate the 547 km line to extend Mongolia’s national rail network from Erdenet to Aspire’s Ovoot Coking Coal Project (Ovoot Project), which represents the first stage of a new rail connection linking Mongolia to Russia. A Pre-Feasibility Study has been completed on this project with an estimated capital cost to construct of USD 1.2 billion.
Northern Railways negotiations for the Concession Agreement were supported by a consortium comprising Aspire, and China Railway Construction Corporation (China Railways) subsidiaries, China Railway 20 Bureau Group Corporation (CR20G) and China Railway First Survey & Design Institute (FSDI).
Northern Railways will work exclusively with CR20G and FSDI to compete the bankable feasibility study and negotiate the terms of the EPC contract to be awarded to CR20G.